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CSI Study

J.D. Power and Associates Reports:
Exceptional Service Satisfaction Enhances Dealer and Manufacturer Profitability Through Improved Customer Retention, Even as Vehicle Sales Decline​

Lexus Ranks Highest in Customer Satisfaction with Dealer Service

WESTLAKE VILLAGE, Calif.: 25 February 2009 — In today’s tough automotive market, providing consumers with superior service experiences translates into increased profitability for dealers and automakers, with the highest-performing brands retaining more than 80 percent of their customer maintenance and repair dollars within their dealer network, compared with retention rates of less than 60 percent for lower-performing brands, according to the J.D. Power and Associates 2009 Customer Service Index (CSI) StudySM released today.

The study, now in its 29th year, examines satisfaction among vehicle owners who visit a service department for maintenance or repair work. The CSI rankings are based on dealer performance during the first three years of ownership, which typically represent the majority of the vehicle warranty period. Five measures are examined to determine overall customer satisfaction with dealer service (listed in order of importance): service quality; service initiation; service advisor; service facility; and vehicle pickup.

The study finds that although satisfaction with dealer service tends to decline as vehicles age—particularly during the fourth and fifth years of ownership—those automakers whose dealers provide the highest levels of satisfaction during the warranty period retain a greater share of future service visits at the dealership, even after the warranty period expires. Brands with dealers that achieve particularly high CSI scores (800 or higher) during the first three years of vehicle ownership retained 79 percent of dollars spent on maintenance and repairs during the first five years of ownership. In contrast, brands that attained CSI scores below 800 retained only 69 percent of customer maintenance and repair dollars.

The study also finds that consumers report spending an average of $310 annually on oil changes, routine maintenance and repairs during the first five years of vehicle ownership. Higher satisfaction with dealers leads to a dramatically lower likelihood to spend this money on visits to non-dealer service facilities. For example, customers who say the dealer service they received was “unacceptable” report spending eight times as much at non-dealer service facilities, compared with customers who report receiving “truly exceptional” service from their dealer.

“Since dealer service is the last touch point in the vehicle ownership cycle that auto manufacturers have with customers, providing superior levels of service can leave owners with a lasting favorable impression of the brand,” said Jon Osborn, research director at J.D. Power and Associates. “Providing excellent service is not only good for customers, but it also benefits dealers and automakers in terms of income from future service visits and sales. The significant decline in new-vehicle sales means that dealers are relying even more heavily on the service-operations side of their business for much-needed revenue. In many cases, this income is keeping the dealerships open. With the stakes so high, it is imperative for dealers to focus heavily on maximizing satisfaction levels.”

Lexus ranks highest in customer satisfaction with dealer service in 2009—improving from fourth rank position in 2008. Lexus achieves an overall CSI score of 835 on a 1,000-point scale and performs particularly well in four of the five measures: service quality; service initiation; service advisor and service facility. Rounding out the top five nameplates are Jaguar (810), BMW (808), Cadillac (806) and Acura (805).

“The highest-performing brands differentiate themselves particularly in the service quality and service facility measures,” said Osborn. “There are several practices that the highest-ranked brands consistently perform that help elevate customer service satisfaction levels, including providing prompt service appointments; greeting the customer immediately on arrival; knowing the vehicle’s service history; returning vehicles to customers in a clean condition; and offering alternative transportation to customers leaving their cars for service. These courtesies may seem intuitive, but many dealers do not provide them consistently. We find that they are very effective in raising customer satisfaction, provided that the service work performed on the vehicle is also satisfactory.”

The 2009 CSI Study is based on responses from 106,059 owners and lessees of 2004 to 2008 model-year vehicles. The study was fielded between October and December 2008. J.D. Power and Associates measures dealer service in various countries around the world, including Australia, Canada, China, France, Germany, India, Indonesia, Japan, Malaysia, Mexico, New Zealand, the Philippines, South Africa, Taiwan, Thailand and the UK.
 

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Article

NewsDay
BY TOM INCANTALUPO | [email protected]com
7:40 PM EST, February 25, 2009​

Dealers handling Toyota Motor Corp.'s Lexus vehicles do a better job than any others of keeping customers happy in their service departments, a new consumer survey has found.

But dealers handling less-expensive Toyota brand models score far below the industry average in the study.

The latest "Customer Service Index," which is updated annually by California-based market researchers J.D. Power and Associates, also found that vehicle price is no guarantee of top-flight treatment in a service department; while the highest scorers tend to be luxury makes like Lexus, Cadillac, Acura, Jaguar and Land Rover, dealers handling more moderately priced Buicks and Saturns kept their customers happier than those handling vehicles made by Mercedes-Benz and Infiniti, Power said.

The survey also threw cold water on the notion of Japanese cars and their dealers being better as a group than Detroit's Big Three cars and dealers; Nissan dealers scored third from the bottom. Nissan vehicles also have scored poorly in recent Power surveys.

A Nissan spokesman had no comment.

Suzuki dealers scored lowest, but Jon Osborn, research director at Power, says below average performance does not mean poor performance. "Some perform better than others," he said.

Osborn said the low ranking might be due partly to the brand's young and presumably less-affluent clientele, for whom a repair bill is more likely to be a budget buster than the same bill would be for a Lexus owner. "It's a bigger financial pain for young people," he said.

In a statement, Suzuki cited a "regrettable attrition of dealers and -- correspondingly -- reduced number of service personnel [which] puts stress on the service infrastructure and subsequent service satisfaction scores."

Dealers handling Toyotas ranked below dealers handling all of General Motors and Ford Motor Co. brands. Toyota spokesman Joe Tetherow in California said it is working with dealers to improve service and that dealers are investing billions of dollars in physical improvements. "We take it seriously," he said. "We don't like being where we are."

Osborn says top-ranked service departments excel at giving prompt appointments, greeting customers immediately when they arrive, offering alternative transportation, doing the job quickly and right the first time, and returning the car cleaner than when it arrived.

The new study is based on responses from 106,059 owners and lessees of 2004 through 2008 model-year vehicles.

 

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Hmm, I was surprised at a few of those rankings, especially Acura's spot in relation to Honda's, and other Japanese auto makers. VW was way lower then I thought it would be, Audi higher, and Buick a hell of a lot higher.

I wonder if there's some correlation between number of cars sold (or ownership rates), and repair difficulties. Or, if there's 10x more of car X sold then car y, will there be a higher rate of repair issues for car x?

Acura is pretty spot on, though. I've never had a major problem, of course, I get a lot of maintenance done.
 

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J.D. Power is a bunch of BS, that is, if you have any questions about the results.
 
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