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Buyer Incentives May Come As Detroit Suffers Customer Satisfaction Blow

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On: Wed, Aug 24, 2011 at 3:54PM | By: Chris Weiss


Buyer Incentives May Come As Detroit Suffers Customer Satisfaction Blow

After seemingly being back after their highly public woes of 2009, American automakers have suffered another blow. It seems that customers just aren't as satisfied with many of Detroit’s brands as they were last year. The American Customer Satisfaction Index has brought bad news to several key American brands and good news to Japanese counterparts.

Lexus and Toyota are back in business after taking a dive last year due to ongoing recalls and investigations. Toyota rose 4 percent and Lexus 2 percent to retake the top spot with customer satisfaction ratings of 87. Prior to last year, Lexus had found itself at the very top of the list for several years in a row. Cadillac rose 1 percent from a year ago, tying the Toyota brands for first place. Honda rose 1 percent to 85 and Ford jumped 2 points to 84.

From there, Detroit brands suffered, with last year's leaders—Lincoln and Buick—sliding by 3 percent down to to 86 and 85, respectively. GMC slipped a percent to an industry average 83 and Chevy rose 3 percent, but still sat below average at 82.

While GM and Ford didn't perform well, Chrysler performed the worst of the brands in the survey. Chrysler itself experienced a 5 percent slide for the second year in a row, finding itself at the very bottom of the survey with a 76. Despite respective 1 and 3 percent increases for Dodge and Jeep, these brands found themselves well under the industry average at 79.

Okay, so those numbers aren't necessarily interesting on their own. But what they indicate is that rebounding Detroit brands face a tough year. Despite being on the upswing last year, and despite the fact that Detroit was helped by a tsunami-weakened Japanese auto industry, four Detroit brands slid in satisfaction. Meanwhile, all Japanese brands except for Mazda increased their satisfaction ratings, in spite of a tough year fraught with natural disasters of epic proportions.

ACSI founder Claes Fornell essentially classifies it as a missed opportunity for Detroit, stating: "Production challenges for Japanese automakers provided an opportunity for Detroit to increase both market share and earnings, but declining customer satisfaction will make it difficult to sustain these gains as the Japanese companies begin to recover," adding: "It used to be Detroit that was forced to use buyer incentives to compensate for its weaker customer satisfaction. Now, with the Japanese using discounts in addition to their strong customer satisfaction, Detroit will probably have no choice but to respond in kind, putting more pressure on profit margins as a result."

In other words, if you're considering a new Ford, GM or Chrysler vehicle, you may want to wait a little bit to see what types of discounts and incentives they offer.




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