Car buyers' satisfaction with US brands stumbles

NEW YORK - August 19, 2008 Consumer satisfaction with U.S. auto brands slipped as Lexus and BMW tied for first place, followed by Toyota and Honda, according to the University of Michigan's American Customer Satisfaction Index released Tuesday.

General Motors Corp.'s Buick and Cadillac brands, and Ford Motor Co.'s Lincoln and Mercury lines, fell from their No. 2 perch at a time when U.S. companies are struggling to outshine their competitors and reverse their shrinking sales and market share.

That's an unsettling sign for domestic automakers, said Claes Fornell, the University of Michigan business professor who heads the annual survey. Traditionally, U.S. brands improve their customer satisfaction scores each year, just not as much as their overseas counterparts. Now, the domestic companies' ratings are declining while their competitors' scores continue to climb.

"This is somewhat of a double whammy here," Fornell said. "The struggling companies are getting an even tougher road in the near future. The question also is do they really have the resources, the cash here" to adapt.

The auto industry's customer satisfaction has increased steadily over time and its overall score of 82 - unchanged from the high set a year ago - is higher than many other industries the index tracks.

In addition, just 11 points separate the best-scoring brand from the worst, but domestic automakers are having the hardest time adapting to high gas prices and a shift in demand toward more fuel efficient vehicles, and that is manifesting itself in weaker customer satisfaction, Fornell said.

"I think there is little question that the domestic automakers are somewhat strapped for resources, and they have to go out and borrow money and stuff like that," he said. "Whenever they have to do that, it is difficult to come up with the same level of quality and the same level of customer satisfaction."

Asian and European automakers crowded the upper end of the rankings. BMW gained one point to score 87, tying Toyota Motor Corp.'s Lexus luxury brand, which held the top spot alone last year. Toyota's namesake brand and fellow Japanese automaker Honda Motor Co. both rose two points to 86.

Several U.S. brands, by contrast, saw their ratings slump. Buick and Cadillac fell a point to a score of 85, while Chevrolet slipped three points to 79. GM's Saturn brand, however, jumped four points to 85, which Fornell said was largely due to the brand's better fuel economy.

Lincoln and Mercury lost three points to 83, while the score for Ford's namesake brand was unchanged at 80.

Chrysler LLC's brands fared the worst among the domestic automakers. Its Dodge and Jeep lines sat at the bottom of the 22-brand ranking, while its namesake brand shared the fifth-to-last spot with Ford. All of Chrysler's ratings came in below the average rating.

The telephone survey asked 5,500 people who bought cars within the past three years how their satisfaction level compared with expectations, how their vehicle compares with the ideal vehicle, and their overall satisfaction level, on a scale of zero to 100.

The survey's margin of error is about two points for each car maker, Fornell said.

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