Detroit’s New Right Turns
General Motors and Ford revved into the headlines recently by finally managing to drive a pair of models onto a much-watched Top 10 customer satisfaction survey. Though the world’s two largest automakers will be quick to boast about their improved quality, it will take Detroit years of steady improvement to win back drivers they’ve already burned. J.D. Powers & Associates’ consumer satisfaction list -- a must-reference for so many consumers -- consistently ranks Toyota, Nissan and Honda at the top. So it’s great that GM and Ford each managed to place two brands, including No. 3 Buick, on the survey.
Truth be told, though, the domestic car makers were abetted by quality lapses in Europe by Volvo, Volkswagen and Land Rover. Japan’s Big Three -- with their upscale Lexus, Infiniti and Acura brands -- stayed parked at the top in overall consumer satisfaction. While U.S. brands continued to narrow that gap, Japanese companies dominated customer confidence in the much-demanded category of long-term durability.
That leaves Detroit dependent on rebates and low-cost financing -- two exceedingly pricey means -- to move cars off dealer lots. Last month, GM incentives averaged $3,934 per car, compared with Ford’s average of just under $3,500. In contrast, Honda, Toyota and Nissan offer relatively few rebates or financing plans. In fact, consumers are so enamored with Honda quality that they pay $1,500 more for its sedan than a similarly equipped car from another manufacturer.
GM’s improved quality should dovetail nicely with its innovative marketing program to encourage consumers to take cars and trucks for 24-hour test drives. But gimmicks alone won’t lure back motorists who have been getting better treatment and performance -- for a long time -- from the foreign competition.
Still, some other, lesser-publicized surveys offer more cause for optimism for Detroit, and, ultimately, consumers. This data measures the productivity and profitability of domestic auto plants. The good news for GM and Ford is that Detroit generally is getting better at building cars the right way the first time. That’s key to eliminating costly production glitches and warranty repairs that not only ding automaker earnings but also send consumers hunting overseas for quality wheels.
