Automotive Sector Turns A Corner?

Chinese growth offsets poor European performance but overcapacity risk looms.

Car industry commentators have drawn a line under recent safety concerns at Toyota as, for the first time since March more than 25% of all coverage focused on sales figures compared to less than 20% on safety issues.

Brand issues grew in importance this month as manufacturers turned to social media in their marketing mix and Ford unveiled pricing for its 2011 Explorer, which has a smaller engine but a higher price tag than its predecessor. (15%). Ford’s decision to risk market share for margins by not offering sales incentives also helped strengthen the quality perception of its brand amongst customers.

Toyota continued to dominate the automotive issues agenda thanks to the ongoing investigations into its safety record in the US. Although public interest in safety stories has waned (7^th place- 8%), the continued association of the manufacturer with this negative issue does persist.

“Corporate and sales issues were naturally dominant during this busy period of financial reporting, reflected in our analysis of the automotive issues agenda in July” said Alberto Lopez-Valenzuela, CEO of Alva. “China is still perceived as the saviour for the global automotive industry as Europe looks set to struggle in the second half of 2010 following the end of government incentives. However upward wage and raw material costs, slowing growth coupled with real fears of overcapacity all mean that many manufacturers will continue to struggle in this competitive market.”

Looking forward, Alberto said that although financial results will continue to dominate news in August, the subject of electric vehicles is also likely to increase in prominence following the government backing of incentives for the technology and the release of pricing for GM’s Chevrolet Volt.

Each month, corporate reputation analysis company Alva reports on the biggest reputational risk issues in the Automotive industry using information collected from its daily Alva Automotive In Sight service.

For the latest updates on emerging Automotive issues follow Alva on Twitter @AlvaAutomotive

Ends

Summary of Automotive Industry Issues in July 2010

Alva analyses content from over 1 million mainstream media, blog, micromedia, forums, brokers notes and social networking sites

Top 10 Manufacturers

1. Toyota- 12.32%
2. Ford- 7.60%
3. General Motors- 7.40%
4. Nissan- 6.16%
5. Chevrolet- 4.93%
6. BMW- 4.76%
7. Audi- 4.05%
8. Volkswagen- 2.04%
9. Lexus- 2.00%
10. Mercedes-Benz- 1.87%

Top 10 Issues

1. Ford unveils 2011 Explorer, asks buyers to pay more for less power – 10.84%
2. GM announces Chevrolet Volt pricing – 7.35%
3. Toyota sudden acceleration probe has yet to reach conclusion – 11.21%
4. Toyota subpoenaed by US grand jury over steering defects – 5.33%
5. Automakers report profitability– 3.82%
6. Toyota and Ford reach settlement with Paice over hybrid technology – 2.76%
7. Toyota knew of Lexus engine problems since 2007 – 2.74%
8. Automakers report increase in sales for June and first half of 2010 – 2.27%
9. Automakers report surge in China sales for first half of the year – 1.84%
10. Nissan suspends plants in Japan and the US due to parts shortage – 1.44%

Issues Dominance

1. Corporate- 17.31%
2. Brand- 14.83%
3. Quality & Service- 13.12%
4. Sales- 11.02%
5. R&D- 10.20%
6. Sustainability- 9.43%
7. Safety- 8.26%
8. Production- 5.46%
9. Regulation- 5.15%
10. Emerging markets- 3.31%

About Alva

Alva specialises in analysing corporate reputation and reputational risk.

Our services equip organisations with the analysis tools to manage reputation and reputational risk in the same way as any other valuable business asset.

Alva’s services are industry sector specific. Reputation analysis services for the Automotive and Energy and Utilities industries are already being delivered with services for the financial services communities following shortly, with 32 industry sectors planned in total.

Alva’s founding team brings more than 50 years experience in media intelligence, business analysis and technology innovation, having worked at leading organisations such as Clifford Chance, Deutsche Bank, Datamonitor and PA Consulting.

Alva’s Board of Directors consists of industry experts with extensive first-hand experience in managing reputation at PLC level. Alva Chairman Andrew Vickerman is the former Global Head of Communications & External Relations at Rio Tinto Plc. Serving as Non-Executive Directors are Alan Schofield, former special-adviser and press secretary to HM Government and Mark Rigby, Director of Corporate Affairs at Sainsbury’s PLC.

For further information please contact Alastair Pickering at 020 3102 9655, or visit www.alva-group.com

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Paul Smith

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