New analysis from Frost & Sullivan’s Automotive and Transportation group projects that the Canadian sale of active safety systems and safety restraints markets will generate nearly $800 million in 2010.
Typically, vehicle makers introduce new technologies in upscale vehicles at high prices. Over time, they redesign the systems to reduce costs, even as they become more effective, and volume builds, which allows manufacturers to realize economies of scale. For these reasons, prices generally drop substantially, and vehicle makers then are able to offer once-exotic technologies in mid-market and even economy vehicles.
“Quite likely, some of the safety systems now in the development and introduction stages of their product lifecycles will do the same. Others, however, may not find favor with vehicle buyers, and thus will fall by the wayside,” says Rick Brown, Customer Research Project Manager for Frost & Sullivan.
Developers of these systems are likely to take losses, while developers of successful systems will reap profits for the vehicle makers that install those systems.
Vehicle makers can find the optimal equipment packages through trial and error, but they will arrive at that point much more quickly if they use input from consumers to determine their initial offerings. A modest investment in market research can steer market participants in the right direction, helping them invest in the most likely technologies, and to maximize their returns.
Frost & Sullivan’s analysis asked respondents their opinions on their preferred systems, warnings and level of control, their perceived prices of various safety systems, the prices that they are willing to pay for various safety systems, factors that influence their choices of safety systems, and the importance of NHTSA and IIHS safety ratings in vehicle purchase decisions.
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