Today’s blog is the first of three that will highlight new or redesigned models for the 2015 model year. Part 1 covers the importance of new product to manufacturer growth plans and details ‘15MY introductions at a market level and by brand. Parts II and III will cover introductions of specific models by segment.

Manufacturers have a lot on the line when it comes to new model introductions and redesigns.

Years of planning and millions of dollars are invested in each new model launch with no guarantee the market will embrace an automaker’s efforts. An ugly miss can force a manufacturer to divert precious resources to fixing perceived shortcomings, while a hit allows an OEM to move on unencumbered to the next model in its strategic plan. More importantly, new models present automakers with their best opportunity for market growth, both within a pre-existing segment and in all new ones.

Various studies have shown that new or freshened models not only offer a firm the opportunity to expand their presence within various segments, but the failure to do so on a regular basis virtually condemns a manufacturer to stagnation or decay. For these reasons, the 2015 model year will perhaps be one of the most important in shaping the automotive landscape in recent memory.

As the chart below illustrates, it’s predicted that 57 models will be all-new or heavily revised for the 2015 model year, which is significantly more than in any year since the last peak of 66 in 2007 and the third highest total in the past twenty years.

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The period between the early 1990s and 2007 marked a period of intense growth in the number of models introduced each year.  The Great Recession, however, dictated a sharp retraction in new model activity both in both in absolute terms and as a proportion of total models.  The relative dearth of redesigns in recent years and large number of redesigns expected for 2015 may be a harbinger of significant market movements.

Periods in which redesigns are sparse generally offer opportunities for manufacturers to gain on their competitors.  For example, one academic research paper found that most of the 25.5 percent decline in the market share of domestic manufacturers between 1995 and 2006 is due to less frequent redesigns than Japanese and European competitors (Korenok, Oleg, George Hoffer, and Edward Millner. "Non-price determinants of automotive demand: Restyling matters most." Journal of Business Research. (2010): 1282-1289).  This relationship is illustrated in the chart below.  

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The number of redesigns was sharply curtailed by both domestic and foreign manufacturers following global economic troubles; however, the gap between redesigns by foreign and domestic manufacturers grew markedly.  In 2015, the gap will be the smallest that it has been since 2007.  This may offer opportunities for American brands to regain a portion of the sales that they have been losing to foreign manufacturers.  This observation relays the point that whether on a segment or industry scale, regularly pursuing redesigns are critical to maintaining competitiveness.

Of course, the absolute number of redesigns by foreign manufacturers reflects in part the growth in the number of manufacturers competing with the domestic ones and GM’s bankruptcy forced the company to shutter multiple brands.  But it is noteworthy that after 2009 foreign manufacturers steadily increased their number of redesigns, while American activity has been much more volatile.  The large spike in the number of redesigns by domestic manufacturers in 2015 is another reason why it’s such an intriguing year.

Introductions by Brand

GM is scheduled to introduce more new or redesigned models than any other automaker this year with 13 fresh launches.  Not surprisingly, most of them are of utility or truck based platforms as they continue to be both a popular choice for consumers and a category of vehicle that GM excels in producing.  GM has dominated the full-size SUV market with its Chevrolet Tahoe/Suburban and GMC Yukon/Yukon XL as well as the more upscale Escalade/Escalade EXT. For the ‘15MY, GM launches redesigned versions of each on a new body-on-frame platform; combined, the SUVs make up almost half of the OEM’s efforts this year.  Although fellow domestic manufacturer Ford Motor Company may only have 5 new vehicle launches, these are composed of historically important and iconic models, with the best-selling vehicle in America the Ford F150 and the popular Mustang sharing the spotlight.  About 25 percent of all new or redesigned vehicles are composed of Chevrolet, Ford, and GMC vehicles for 2015; this is a rare year in which domestic manufacturers are introducing more new or redesigned models than Asian manufacturers.

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BMW has been busy as well, as it takes one of the top spots for the number of new models launched within a brand this year (most are available already).  To illustrate the breadth of their focus, these include the M3/M4 performance cars and the crossover X4 and X6.  Not to be left behind, Mercedes has the new stylish C Class and the flagship S Class Coupe.  However, the bigger news is perhaps the brand new models Mercedes has in store for us; the GLA Class should be a worthy competitor in the luxury compact crossover segment that is heating up very quickly.  At Volkswagen, the eagerly awaited seventh-generation Volkswagen Golf also arrives this year.  With the new Golf MQB architecture, there will be a both a sportier GTi and the new Golf Sportwagen joining the family.  Rounding out the top manufacturers for 2015 is Subaru.  Subaru has seen great success in their sales recently which should continue as the highly anticipated WRX has been released.  The newly redesigned Legacy/Outback are also in Subaru’s new lineup.

We will continue to explore the 2015 market by highlighting key segments and models in the next entry.