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Vehicle Choice Behavior and the Declining Market Share of U.S. Automakers

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  • Train, Kenneth E.
  • Winston, Clifford

Abstract

We develop a consumer-level model of vehicle choice to shed light on the erosion of the U.S. automobile manufacturers' market share during the past decade. We examine the influence of vehicle attributes, brand loyalty, product line characteristics, and dealerships. We find that nearly all of the loss in market share for U.S. manufacturers can be explained by changes in basic vehicle attributes, namely: price, size, power, operating cost, transmission type, reliability, and body type. U.S. manufacturers have improved their vehicles' attributes but not as much as Japanese and European manufacturers have improved the attributes of their vehicles.

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Bibliographic Info

Paper provided by Regulation2point0 in its series Working paper with number 331.

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Date of creation: May 2006
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Handle: RePEc:reg:wpaper:331

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Web page: http://regulation2point0.org/

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