WESTLAKE VILLAGE, Calif.--The big news from J.D. Power and Associates' 2004 Initial Quality Study, released today, is that Korean manufacturers outperformed European and American manufacturers in initial quality. The Korean brands went from a whopping 272 problems per 100 vehicles in 1998 to 117 problems in 2004--a 57 percent improvement. They had six fewer problems per 100 units than domestic automakers and five fewer than Europeans.

Japanese automakers still held the lead in initial quality, but only with six fewer problems per 100 units than the Koreans. And Hyundai, which surprisingly jumped 16 notches in the nameplate ranking, scored higher than the Toyota nameplate.

Korean automakers struggled with a reputation for poor quality a decade ago, said Joe Ivers, partner and executive director of quality/customer satisfaction at J.D. Power.

"No one would have predicted they could not only keep pace but actually pass domestics and other imports in terms of initial quality," said Ivers. "This demonstrates how vastly more competitive the market has become."

Toyota Motor Sales was the top-ranked corporation in the quality study, a position it's held for five straight years now. Lexus was the top-ranking nameplate for the fourth consecutive year.

"The quality bar is moving ... and moving fast," said Bob Daly, Toyota Customer Services' group vice president. "It's moving beyond 'defects' toward customers' perceptions and preferences. It's not just whether something went wrong, but rather if everything was just right."

The industry-wide initial quality of vehicles improved 11 percent from 2003. The average IQS score was 119 problems per 100 vehicles, compared to 133 in 2003.

With an average score of 123, the domestics had a 9 percent improvement over last year. Of the Big Three, General Motors Corp. scored the highest with 120. DaimlerChrysler scored 123 and Ford Motor Co. scored 127.

"Chrysler Group's 11-percent improvement in the latest J.D. Power IQS results marks our 14th consecutive year of quality improvement--a claim that cannot be made by any other manufacturer and is further proof that our quality initiatives are being validated," said DaimlerChrysler in a statement.

American Honda Motor Co. and Hyundai Motor America tied for second in the corporate ranking, behind Toyota. BMW of North America took fourth place. These were the only manufacturers to score above average.

The Initial Quality Study measures quality problems, particularly defects and malfunctions, workmanship, drivability, ease of use and safety problems. The 2004 study looked at responses from over 51,000 buyers and lessees of new 2004 model-year vehicles. They were surveyed after owning the vehicle for 90 days.