European Automakers Sweep Top Spots in ALG’s Canadian Brand Value Rankings
When it comes to the intrinsic value of a brand selling vehicles in the Canadian auction space, one mainstream brand, in particular, stands head and shoulders above its competitors, according to ALG Canada.
Earlier this week, the firm released its rankings of automaker’s statistical brand values — which looked at one- to five-year-old wholesale units sold during 2011 and 2012 — and found that among mainstream brands, Mini “clearly outperforms the competitors,” as the European carmaker’s brand value is 38 percent stronger than the mainstream average.
“Compared to other, identically equipped vehicles, Mini models sell for a 38-percent premium over the mainstream average for vehicles returning to the used-vehicle market in 2011 and 2012 on average,” ALG explained. “Sales for Mini models are rather small compared to the other mainstream brands and thus limited supply has a rather positive impact on used-vehicle market values given the strength of demand.”
Volkswagen (32 percent premium) was next on them mainstream list, followed by Honda (27 percent). Nissan and Subaru tied for fourth, as each fetched a 20-percent premium. Toyota wasn’t far behind at 19 percent. Other brands whose value was above the mainstream average were Mitsubishi (5-percent premium), Jeep (2 percent) and Mazda (2 percent).
Conversely, six of the bottom seven spots for brand value went to Big 3 brands, with Ram Trucks having the lowest rating (32-percent reduction).
Among the luxury brands, Porsche topped the list (34 percent), leading a wave of four German brands dominating the top five for luxury carmakers. BMW was second (17 percent), Mercedes was third (14 percent) and Audi was fifth (11 percent). Japanese luxury brand Lexus placed fourth with a 13-percent premium.
On the opposite end of the luxury spectrum was Saab.
“Unsurprisingly, the now out of business Saab has the largest negative premium on its vehicles, which sell for 31 percent less than an identically equipped average luxury car,” ALG commented. “Similar to mainstream vehicles, North American manufacturers do not fare well in the luxury segment, with Cadillac and Lincoln each selling for a substantial discount to the luxury average.”
In addition to rating the individual brands, ALG also touched on what makes up its statistical brand value and its impact.
“The intrinsic value of a brand is the difference in pricing after all other factors such as equipment, mileage, age, horsepower, torque and fuel economy have been taken into consideration. By controlling for measurable attributes of a vehicle any variation in the sales value is attributed to the perceived value of one brand versus another,” ALG explained.
“Brand value can be the result of actual performance, reliability, or styling superiority or simply consumer preference based on marketing or other unquantifiable appeal,” officials added.
ALG went on to note that the statistical brand value is used by the firm in other measurements it calculates, such as the residual value forecasting model, among others.