2016 U.S. Initial Quality Study: U.S. New-Vehicle Quality Makes Largest Improvement in 7 Years
It appears that automakers are finding ways to integrate new vehicle technologies without it having a severe impact on car quality. In fact, new-vehicle quality is up 6% in 2016, compared with 2015—double the 3% rate of improvement in 2015 from 2014—according to the J.D. Power 2016 U.S. Initial Quality StudySM (IQS). This represents the largest year-over-year increase in vehicle quality since 2009.
The Initial Quality Study, now in its 30th year, examines problems experienced by original vehicle owners during the first 90 days of ownership. Initial quality is determined by the number of problems experienced per 100 vehicles (PP100), with a lower score reflecting higher quality. This year’s study shows improvement in quality across all eight problem categories measured in the study, with 21 of the 33 brands included in the study improving their quality in 2016 and one remaining the same.
“Manufacturers are currently making some of the highest-quality products we’ve ever seen,” said Renee Stephens, vice president of U.S. automotive quality at J.D. Power. “Tracking our data over the past several years, it has become clear that automakers are listening to the customer, identifying pain points, and are focused on continuous improvement. Even as they add more content, including advanced technologies that have had a reputation for causing problems, overall quality continues to improve.”
Domestic Automakers Show Strongest Improvement
For just the second time in the 30-year history of the study, U.S. domestic brands collectively have lower problem levels than all their import counterparts combined. The study shows year-over-year quality improvements for all three U.S. domestic automakers, for a combined average of 103 PP100, improving 10% from 2015. This is double the improvement rate of the import brands (106 PP100). The last time U.S. domestic brands outpaced imports was in 2010, when they held an advantage of 1 PP100 (108 PP100 vs. 109 PP100, respectively). For the first time since 2006, non-premium brands have fewer problems (104 PP100) than premium brands (108 PP100).
According to J.D. Power research, expected reliability remains the most important consideration when purchasing a new vehicle, cited by 49% of owners. Among owners who experience no problems with their vehicle in the first 90 days of owning or leasing, 54% stay with the same brand for their next vehicle. Loyalty drops to 50% among owners who experience one problem with their vehicle and to 45% among those who experience three or more problems.
“There is a direct correlation between the number of problems a customer has with their new vehicle and the decisions they make when it comes time to purchase or lease their next car or truck,” said Stephens. “While a small drop in actual loyalty may not sound like much, a percentage point drop in share can mean millions of dollars in lost revenue to an automaker.”
Kia, Porsche Have Fewest Problems
According to the 2016 U.S. IQS, Kia ranks highest in initial quality, with a score of 83 PP100—the first time in 27 years that a non-premium brand has topped the rankings. Kia ranked second overall in 2015, but ranked highest among non-premium makes that year. Porsche (84 PP100) ranks second among all badges, followed by Hyundai (92 PP100), Toyota (93 PP100), and BMW (94 PP100). Chrysler and Jeep are the most improved brands, each reducing the number of problems by 28 PP100 from 2015.
GM Receives Seven Individual Model Awards; Toyota Motor Corp. Six
General Motors, with seven model-level awards, is the “automaker with the mostest,” followed by Toyota with six and Hyundai and Volkswagen each with four. General Motors models that rank highest in their respective segments are the Buick Cascada, Chevrolet Equinox, Chevrolet Silverado HD, Chevrolet Silverado 1500, Chevrolet Spark, Chevrolet Tahoe, and the GMC Terrain. Toyota Motor Corp.’s award-winning models are the Lexus CT, Lexus GS, Scion tC, Toyota Camry, Toyota Corolla, and the Toyota Highlander. Hyundai Motor Company models that rank highest in their segments are the Hyundai Accent, Hyundai Azera, Kia Soul, and the Kia Sportage. Volkswagen AG’s award recipients include the Audi Q3, Audi TT, Porsche Macan, and the Porsche 911.
Based on the study, J.D. Power offers the following consumer tips:
- Consult J.D. Power studies of the past several years to determine which automakers are the most consistent producers of high-quality vehicles and which have shown dramatic improvement recently.
- If a model has a comparatively high PP100 score, find out whether it’s due to a specific, consistent problem that may have been addressed.
- Don’t assume that premium models will have lower PP100 scores or that a certain automaker’s models will all be of similar quality.
About the Study
The 2016 U.S. Initial Quality Study is based on responses from more than 80,000 purchasers and lessees of new 2016 model-year vehicles surveyed after 90 days of ownership. The study was fielded from February through May 2016.