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Auto on Info  August 2007

Gleaning Value from J.D. Power Studies: An Index of Total Cluelessness?

By James B. Bleeker

We begin by plotting (1) the normalized values of Consumer Reports' 2007 Reliability Scores for 36 motor vehicle lines (found on page 25 of the April issue of Consumer Reports) versus (2) the normalized differences of J.D. Power and Associates' recently released complaint frequencies (available at www.jdpower.com). We have:

From the very scattered distribution of the plotted points (and the resulting very low R2 value and quite horizontal character of the regression line), we see that CR's reliability scores and J.D. Power's complaint frequencies bear very little relationship to each other.

We find a similar absence of relationship if we plot the Reliability Percentranks for model year 2002 against the normalized differences of J.D. Power's complaint frequencies, as the following chart depicts.

 

Possible Explanations

Some possible explanations for the absence of relationship are:

1. J.D. Power's complaint frequencies treat only model year 2004 while Consumer Reports reliability scores are based on model years 2004-to-2006 and the Reliability Percentranks are for model year 2002.

2. J.D. Power's survey seeks out complaints without distinguishing between the arguably trivial and the serious, and Consumer Reports queries for serious problems.

3. Consumer Reports' survey pool - its subscribers - may have a much higher mental alertness and more acute awareness than a pool of U.S. consumers at large.

The first possible explanation surely accounts for a little bit of the absence of relationship, as the following chart plotting the Reliability Percentranks for model year 2002 versus the normalized values of CR's 2007 reliability scores suggests.

Note that the coefficient of the x-variable (the slope of the regression line) is much closer to 1 (i.e., the line is much more diagonal than horizontal), but nonetheless, not diagonal, although much of the difference between this regression line and a diagonal line may result from the expedited dilapidation of Big Three - GM, Ford and Chrysler - vehicles after the first 3 years.

To see the difference that one model year makes, we have the following chart.

While the regression line is even more diagonal, we see a fair amount of shifting at the bottom end of the reliability spectrum, likely because at the bottom end of the spectrum the differences in quality may be smaller.

Hence, the first possible explanation accounts for a little bit of the difference, but not much. This suggests that some combination of the second and third possible explanations account for the bulk of the absence of relationship between CR's reliability scores and the normalized differences of J.D. Power's complaint frequencies.

 

An Index of Cluelessness?

The largest negative values obtained by subtracting the normalized differences of J.D. Power's complaint frequencies from the normalized values of Consumer Reports' 2007 reliability scores may shed light on the primary reason for the negligible relationship depicted in the first of the above charts. The five largest negative values and the respective motor vehicle lines holding them are given in the following table.

Table I: The 5 Largest Negative Values from Subtracting the Normalized Differences of J.D. Power's Complaint Frequencies from the Normalized Values of Consumer Reports' 2007 Reliability Scores
Mercedes-Benz -.74
Cadillac -.51
Jaguar -.42
Buick -.36
Hummer -.31

It appears that Mercedes, Cadillac, Jaguar, Buick and Hummer owners, in the main, go through life with no awareness, not a clue, and in complete oblivion, as to how bad, or truly awful, their vehicles are. As General Motors accounts for 3 of the above 5 lines, this is surely good news for GM and its executives and shareholders; however, one cautionary note before celebration begins:

Year-to-date sales by Jaguar (third on the above list) are down 29.7% and Ford Motor Company hopes to dump the line by September 30th of this year.

Two interesting questions that this apparent abandonment of reality by many Mercedes, Cadillac, Jaguar, Buick and Hummer owners raises are:

1. Does it extend to all of their worldly affairs?

2. If so, should GM trustees, for the welfare of the company and its shareholders, fire any GM executive who owns, or has owned within the past 10 years, a Cadillac, Buick or Hummer?

Those who use the ownership of a GM vehicle as rather an index of vacuousness will likely have a quite definite opinion on the answers to these queries, although the range of answers to the latter query by such may well be across the board.

 

The Rule of Intersection Reviewed

In "The J.D. Power Surveys: Gleaning Values from Things That May Be Worth, Individually, Something Close to Nothing: GM in the Dumps Again," Auto on Info, June 2007, site manager proposed, in order to compensate for the more diminutive consumer value of J.D. Power's individual surveys, a rule of intersection:

Take the intersection of the sets of the 10 best motor vehicle lines in J.D. Power's two most recent 90-day survey results and two most recent 3-year survey results to obtain a list of automobile lines from which consumers may shop, with a measure of confidence, for a quality motor vehicle.

We do the intersection of these four sets again, this time substituting the results of J.D. Power's 2007 3-year survey for those of its 2005 3-year survey. We obtain the following list:

Lexus
Toyota
Honda,

from best to better by average rank for the four surveys. This ranking corresponds precisely with that obtained by using the 1998-2002 Reliability Percentrank average, as the following table sets forth.

Table II: J.D. Power Ranks for Its Top Three Lines by the Rule of Intersection and the Ranks of These Three Lines by the 1998-2002 Reliability Percentrank Average
  J.D. Power Rank 1998-2002-Reliability-Percentrank-Average Rank
Lexus 1 1
Toyota 2 2
Honda 3 3

It again appears that the Rule of Intersection accords the composite use of J.D. Power survey results some consumer value.

 

Source for Jaguar sales: "Automobile Sales Statistics," Wall Street Journal, August 2, 2007, p. A7

Remaining sources: As linked or noted above

 

Related Articles
June 2007: The J.D. Power Surveys: Gleaning Values from Things That May Be Worth, Individually, Something Close to Nothing: GM in the Dumps Again
August 2007: Estimating Model-Year-2008 Reliability: How High Will Toyota's Rise and How Low Will the Big Three's Tumble?
July 2007: The 2007 Reliability-Durability Updates: For Vehicles 4-to-6 Years Old, Toyota and Honda Account for 17 of 17 Best, GM - 24 of 56 Worst: Will a Typical Toyota at 13 Years of Age Be as Troublesome as a Typical GM at 3 Years of Age?
July 2007: The 2007 Reliability-Durability Updates: For Vehicles 5-to-7 Years Old, Toyota and Honda Account for 12 of 13 Best, GM - 19 of 48 Worst: Will a Typical Toyota at 21 Years of Age Be as Troublesome as a Typical GM at 3 Years of Age?
July 2007: The 2007 Reliability-Durability Updates: For Vehicles 6-to-8 Years Old, Toyota and Honda Account for 13 of 13 Best, GM - 18 of 43 Worst: Will a Typical Toyota at 19 Years of Age Be as Troublesome as a Typical GM at 3 Years of Age?
July 2007: The 2007 Reliability-Durability Updates: For Vehicles 7-to-9 Years Old, Toyota and Honda Account for 11 of 12 Best, GM - 22 of 41 Worst: Will a Typical Toyota at 30 Years of Age Be as Troublesome as a Typical GM at 3 Years of Age?
May 2007: In 2007, Toyota and Honda Dominate Most Reliable List with 10 of 11 Best, GM Dominates Least Reliable List with 7 of 10 Worst
May 2007: Toyota Reliability Drops Some, But Toyota-GM Gap Remains Near Record
April 2007: The Best Models by CR's 2007 History of Reliability Verdicts: The Reliable Two Shine; Big Three Score Zip
April 2007: By Yet Another Quality Measure, Toyota and Honda Are Best and GM and DaimlerChrysler - Worst: The UCS 2007 Environmental Report
March 2007: Toyota and Honda Increase Dominance of Consumer Reports' Good Bets List: Toyota's Best Widen Quality Gap
March 2007: Chevrolet Upholds a Tradition: GM's Chevrolet Line Worst by CR's 2007 Vehicles-to-Avoid List
March 2007: GM Expands Lead on CR's Used-Cars-to-Avoid List, a Tad
March 2007: GM Maintains Leadership in Much-Worse-Than-Average: A Guide to Making Sales Challenging
January 2007: The 2006 Updates: Estimated Rates of Motor Vehicle Deterioration, by Line and Manufacturer
December 2006: Toyota, Honda, Subaru, and Nissan Account for Nearly All on List of 2007 Models with CR's Highest Predicted Short-Term Reliability Based on Two or More Years
November 2006: True Value Estimates of GM's 2007 Vehicles
November 2006: The 2006 Updates: Honda Age-Equivalent Estimates: Estimates of When a Typical 1998 Model of Honda Motor Company Will Be as Troublesome as Typical 1998 Models of General Motors Corporation and Its Several Marques Were Circa 3 Years, 4 Years, ..., and 7 Years of Age
November 2006: The 2006 Updates: Toyota Age-Equivalent Estimates: Estimates of When a Typical 1998 Model of Toyota Motor Corporation Will Be as Troublesome as Typical 1998 Models of General Motors Corporation and Its Several Marques Were Circa 3 Years, 4 Years, ..., and 7 Years of Age

Related Web Pages
Milestones in Automotive Quality
The Bottom Line on Auto Reliability
Summary of the Best and Worst
Table and Chart Summary of the 2007 Reliability-Durability Updates

Related Mini-Surveys
A Toyota Owner Survey with Enquiries into Reliability Importance
A Honda Owner Survey with Enquiries into Reliability Importance
A Toyota Owner Satisfaction Poll with Enquiries into Toyota Durability
A Lexus Owner Satisfaction Poll with Enquiries into Lexus Durability
An Infiniti Owner Satisfaction Poll with Enquiries into Infiniti Durability
The True Value of a Big Three
Big Three Bin Readiness
General Motors Travails and Prospects
Is the Ownership of a General Motors Vehicle a Useful Index of 21st-Century Cognitive Uselessness?

 

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