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Does Quality Matter?

Sometimes, high scores in the J.D. Power Initial Quality Study don’t result in big sales.
#BMW #Toyota #Dodge


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While the J.D. Power organization (jdpower.com) does a multitude of survey-based studies over a wide range of industries—everything from healthcare to home improvement—for the auto industry there is probably no more anticipated announcement than the results of the J.D. Power U.S. Initial Quality Study (IQS). It is hard to imagine that one could get better bragging rights from anything else.

The study is based on a survey of people who have owned a new vehicle for 90 days, which the J.D. Power people say is “an excellent predictor of long-term reliability.” Even if it isn’t that, during the first 90 days an owner is likely to determine the pluses and minuses of a given vehicle—especially the minuses.

The IQS looks at eight vehicle categories—Exterior, Seats, Driving Experience, Engine/Transmission, Features/Controls/Displays, Interior, Heating, Ventilation and Air Conditioning, and Audio/Communication/Entertainment/Navigation—and points are tabulated related to the owners’ responses.

There are two main types of findings, one macro and one more individual, with the first being the overall brand rankings and the latter the vehicle segments.

The 2019 U.S. IQS has Genesis at the top of the brand rankings, rankings that are predicated on problems per 100 vehicles (PP100). A lower score is a better score in this instance. Genesis has a score of 63 PP100. At the other end of the rankings there’s Jaguar, with 130 PP100. The industry average is 93 PP100. Given that there are 11 brands above average (in descending order: Genesis, Kia, Hyundai, Ford, Lincoln, Chevrolet, Nissan, Dodge, Lexus, Toyota, Buick) and 21 below average, it is clear that the top skews the average number upward. That is, the average of the 11 brands above average is 82 while the average of the 21 brands below average is 107, which is a non-trivial delta.

But people buy cars, not brands. To be sure, OEMs make big boasts about the performance of their vehicles in the IQS (assuming there is something to be chuffed about).

One thing that is somewhat striking is that while you might think that the vehicles that win their categories in the IQS are flying off the lot, that is not at all the case across the board, based on sales performance in the first quarter of 2019.

The overall most dependable model is the Porsche 911. Its Q1 sales of 2,894 units is an increase of 15.3% over Q1 2018, which is certainly positive. The same goes for the Small Car leader, the Kia Rio, which had sales of 5,844 units, up 16% from Q1 2018.

The BMW 2 Series took the Small Premium Car category, yet with 2,062 units in Q1 ’19, its sales are off 25.5% from the year earlier. The Kia Forte was #A1 in Compact Car, yet its sales—21,374—were down 11% from the previous year. The MINI Cooper took the Compact Sporty Car Category, and while the four-door MINI Cooper was up 20.4%, there were sales of 1,667 in Q1; the two-door version had better sales—2,079—but it was down 11.1%.

The Genesis G70 took the Compact Premium Car award; it had sales of 2,232 in Q1 2019; it wasn’t available in Q1 2018, so there is no comparison.

In Midsize Car the Chevy Malibu and Ford Fusion tied; the former, with sales of 34,197 in Q1, was up just 0.1%; the latter, with sales of 41,683, was down 3.5%.

The Dodge Challenger was the highest ranked Midsize Sporty Car; its Q1 sales, 13,431, were down 24% from Q1 2018. The Midsize Premium Car is the Mercedes CLS; combined with all vehicles in the E Class grouping, there were sales of 10,394 in Q1, down 16.4%. The Nissan Maxima took the Large Car category; with sales of 10,554, it was off 23.3%.

Even in the truck and SUV categories, things aren’t all that swell as regards sales numbers in the first 90 days of 2019. The Kia Sportage is ranked the best Small SUV in IQS, but with Q1 sales of 19,198, it was down 1.35% The Chevy Equinox took Compact SUV and its sales, 88,500 in Q1, were up 7.4%. Midsize SUV went to the Hyundai Santa Fe; it had a 0.4% increase, to 28,683 units in Q1 2019. The Lexus RX is the segment winner in Midsize Premium SUV, yet with 23,529 units sold in Q1, its sales are off 1.1%. Which is better than the case for the Large SUV, the Chevrolet Tahoe, which, with sales of 20,853, had a decline of 11.8%. Which was better than the case for the Large Premium SUV, the Cadillac Escalade, which had a decline of 15.9%, 6,819 units. Even pickups had problems, with the Nissan Titan taking the Large Light Duty Pickup; its sales in Q1 2019 declined 23.9%, to 9,683 units. The Chevrolet Silverado HD is the segment winner in Large Heavy Duty, but its sales, 114,313, were off 15.71%.

Consider: more than half of the category winners saw sales declines. Makes you wonder about the public and quality, doesn’t it?


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