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Vehicle Dependability Declines

In the same month Consumer Reports advised consumers to skip vehicle service contracts, J.D. Power reported that vehicle dependability declined for the first time in 15 years.

May 2014, F&I and Showroom - Feature

by - Also by this author

Top 10 nameplates with most problems per 100 vehicles
Top 10 nameplates with most problems per 100 vehicles

For the first time in 15 years, owners of three-year old vehicles reported more problems than did owners of three-year-old vehicles in the previous year. This unexpected drop in dependability was largely attributed to an increase in engine and transmission problems, findings that could make vehicle service contracts a critical consideration for car buyers.

The 2014 U.S. Vehicle Dependability Study, which J.D. Power and Associates has conducted annually for the past 25 years, examined problems experienced by more than 41,000 original owners of 2011 model-year vehicles. The study was fielded between October and December 2013.

“Until this year, we have seen a continual improvement in vehicle dependability,” said David Sargent, vice president of global automotive at J.D. Power. “However, some of the changes that automakers implemented for the 2011 model year have led to a noticeable increase in problems reported.”

The report was issued the same month Consumer Reports published a piece urging car buyers to skip service contracts, finding that 55% of owners who purchased the coverage hadn’t used it. Those who had, it reported, spent hundreds more for the coverage than they saved in repair costs. The survey, however, covered vehicles built during model years 2006 to 2010.

According to J.D. Power, automakers have been largely focusing on improving fuel economy to keep up with today’s budget-conscious car shopper. But the struggle to provide economical options for consumers might be having an unexpected negative impact on vehicle dependability, Sargent suggested.

“… while striving to reduce fuel consumption, automakers must be careful not to compromise quality,” he said. “Increases in such problems as engine hesitation, rough transmission shifts and lack of power indicate that this is a continuing challenge.”

Overall dependability in the study was determined by the number of problems experienced per 100 vehicles (PP100), with a lower score reflecting higher quality. Compared to last year, owners of three-year-old cars experienced a 6% increase in problems — from 126 PP100 to 133 PP100.

Engine and transmission problems increased by nearly 6 PP100 year over year, accounting for the majority of the overall 7 PP100 increase in reported problems. The decline was particularly prevalent in vehicles with four-cylinder engines, where problem levels increased by nearly 10 PP100. Owners of vehicles with five- and six-cylinder engines, on the other hand, reported fewer problems, on average.

J.D. Power also found that car buyers who experienced fewer problems were more brand loyal. By combining data from last year’s dependability study with trade-in data, the firm determined that 56% of owners who reported no problems stayed with the same brand when they purchased their next new vehicle. For those who reported three or more problems, brand loyalty dropped to 42%.

“By combining our customer research with trade-in data, we see a very strong correlation between dependability and real-world brand loyalty,” Sargent noted. “Also, we see that brands with lower dependability are likely to be shut out of a significant piece of the market, as many consumers will not even consider purchasing one of their vehicles because of concerns about its likely reliability.”

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