Category: China

Nearly One-Half of the New-Vehicle Intenders Willing to Use Online Vehicle Shopping

2014-09-11

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Shanghai: 12 September 2014 — Nearly one-half of consumers in China who expect to be in the market for a new vehicle within the next 12 months—known as intenders—are willing to use automaker websites to shop online for a vehicle, according to the JD Power Asia Pacific 2014 China Brand Website Evaluation Study^SM (BWES) released today.

The study, now in its second year, measures the usefulness of automotive manufacturer websites at the brand level during the new-vehicle shopping process by examining four key factors (in order of importance): navigation; speed; information and content; and appearance.   

With the rapid growth of online vehicle shopping in China, new-vehicle intenders are becoming more familiar with, and embracing, this new way of purchasing vehicles. The study finds that 46 percent of new-vehicle intenders are willing to use online vehicle shopping while only 3 percent are not willing to use it, and 31 percent still don’t know what online vehicle shopping is.

More than 70 percent of new-vehicle intenders cite quick process (77%) and good price (75%) as reasons to use online vehicle shopping. The primary reasons cited by intenders for not using online shopping include the quality of the vehicle being inconsistent with ads (74%); lack of customer rights’ protection (60%); not being able to test drive the vehicle (51%); and concerns with online payment safety (50%).

While the study focused on automotive manufacturer websites, it also examines other automotive websites new-vehicle intenders visit during the shopping process.  Among websites that provide vehicle-shopping services, Auto Home, BitAuto, Sohu Auto and Tmall are among the most visited by new-vehicle intenders looking for online shopping information.

If auto manufacturers were to provide online vehicle shopping on their official website, 44 percent of new-vehicle intenders say they “definitely would” negotiate the price of a vehicle on the site. Additionally, 42 percent of intenders say they “definitely would” schedule their vehicle pick-up or home delivery online, and 39 percent “definitely would” select and purchase a particular model online.  

“Consumers’ growing interest and intentions in online vehicle shopping is pushing the boundaries of the current offline-based purchasing experience,” said Dr. Mei Songlin, vice president and managing director at JD Power Asia Pacific, Shanghai. “To embrace this inevitable market trend, auto manufacturers need to work out an online and offline shopping model that not only provides a good price and quick and easy selection, but also ensures vehicle quality and payment safety and offers test drive services.”

Overall satisfaction with automotive brand websites averages 752 on a 1,000-point scale in 2014, a 22-point increase from 2013. Mercedes-Benz ranks highest among brands in website satisfaction with an 807, followed by Geely (802) and BMW (800).

KEY FINDINGS

• Nine automotive brands have made changes to their official website, which has led to an average satisfaction increase of 39 points among those nine brands. Most of the nine brands have improved their navigation to provide more focused and easy-to-find information.
• ŸYear over year, there has been a 12 percent increase in new-vehicle intenders researching vehicle price information online; a 9 percent increase in searching for updates on newly launched vehicle/ promotion information; and an 8 percent increase in searching for dealers. Intenders are also exploring online shopping information—such as financial/ loan services, online booking and online consulting services—on brand websites 5 percent more often in 2014 than in 2013.
• ŸWebsite speed is critical to intenders. Overall satisfaction averages 780 when website pages open within five seconds, but drops to 751 when the loading time is five to 10 seconds.
• ŸThere is a very strong correlation between brand website satisfaction scores and shopper intentions to test drive and purchase a particular vehicle. Among new-vehicle intenders in the high satisfaction tier (overall satisfaction of 764 or higher), 20 percent say their test drive intention became “much higher” and 15 percent say their purchase intention became “much higher” after visiting the website, compared with 14 percent and 10 percent, respectively, among intenders in the low satisfaction tier (overall satisfaction of 728 or lower).

The 2014 China Brand Website Evaluation Study is conducted via online from 3,677 new-vehicle intenders who indicate they will be in the market for a new vehicle within the next 12 months and are invited to visit one of the 29 brand websites that presents the particular brand/ model they intend to purchase. The study was fielded in April and May 2014 in 73 major cities in China.

About JD Power Asia Pacific: www.jdpower.com

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Purchase Consideration among Consumers for Domestic Brands in China Has Decreased, Most Notably in Tier 2 and Tier 3 Cities

2014-08-28

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Shanghai: 29 August 2014 — Purchase consideration among new-vehicle shoppers in China for domestic brands has decreased, most notably in Tier 2 and Tier 3 cities, according to the JD Power Asia Pacific 2014 China New-Vehicle Intender Study^SM (NVIS) released today.

The study, now in its sixth year, examines the pre-purchase perceptions and purchase considerations of new-vehicle intenders—defined as consumers who plan to purchase a new passenger vehicle within the next 12 months—in 73 cities. The study is designed to provide key consumer insights by examining brand awareness, brand perception, brand and model consideration, purchase consideration and information source, as well as consumer perceptions of various models among new-vehicle intenders. 

The proportion of new-vehicle intenders who indicate they would consider buying a domestic brand has decreased to 16 percent in 2014 from 27 percent in 2013, which is the lowest rate since 2009 when it was 26 percent. The decline is most notable in Tier 2 and Tier 3 cities. In Tier 2 cities, 16 percent of new-vehicle intenders would consider purchasing a domestic model, down from 28 percent in 2013. In Tier 3 cities, the consideration rate for a domestic brand is 20 percent, down from 42 percent in 2013.

European brands are most popular among vehicle intenders at 41 percent, up from 31 percent in 2013, followed by Japanese (19%), U.S. (14%) and Korean (9%) brands.

“Tier 2 and Tier 3 cities are becoming strong automotive markets, with consumers in these cities sharing similar purchase considerations and brand preferences with those in Tier 1 cities more than they have in the past,” said Tony Zhou, director of automotive research at JD Power China. “It is vital for domestic manufacturers to improve the overall brand image and brand influences to gain back market share in China.”

Among the most considered brands are Audi, Beijing Hyundai, Buick, FAW-Volkswagen and Shanghai-Volkswagen.

Models with the highest rates of consideration in each vehicle segment are:

• ŸCompact Mini: smart fortwo
• Compact: Chevrolet Sail
• Compact Upper: Hyundai Verna
• Midsize Basic: Buick Excelle
• Midsize: Volkswagen Sagitar
• Midsize Upper: Volkswagen Magotan
• Compact Luxury: Audi A4L
• Midsize Luxury: Audi A6L
• Large Luxury: Audi A8L
• Compact Luxury SUV: Audi Q3
• Midsize Luxury SUV: Audi Q5
• Large Luxury SUV: BMW X5
• Compact SUV: Buick Encore
• Midsize SUV: Volkswagen Tiguan
• Large SUV: Toyota Highlander

Key Findings

• Across all generations, most vehicle intenders prefer a 4-door sedan with automatic transmission, large space for the driver and smooth driving. In addition, they prefer a vehicle equipped with a GPS navigation system, airbags and a fuel-saving auxiliary system. As for price and after-sale service, the intended vehicle should have a stable price and high maintenance/repair quality.
• ŸThere are some differences in vehicle preference by age group. Consumers born in the 1960s care more about vehicle safety and performance, whereas those born in the 1970s and 1980s are more concerned with vehicle quality. Younger intenders born after 1990 tend to focus more on the vehicle body type than intenders in other generations.
• ŸTop consideration reasons among intenders of luxury vehicles are “good vehicle quality,” “good reputation of the brand” and “vehicle safety,” which are the same as the top purchase reasons among those of owners of new luxury vehicles in the JD Power Asia Pacific 2014 China Sales Satisfaction Index (SSI) Study.^SM Among intenders considering a mass market vehicle, “good vehicle quality” is the leading reason, but when they are enter the purchasing stage, “recommendation by friends/relatives” becomes the leading reason for their purchase decision.  

The study also includes a brand influence score (BIS), which measures familiarity and favorability of automotive brands among new-vehicle intenders in China. BMW achieves a BIS of 664 on a 1,000-point scale, followed by Audi (648), Mercedes-Benz (646), Shanghai Volkswagen (642) and FAW-Volkswagen (639).

The 2014 China New-Vehicle Intender Study is based on responses from 9,727 new-vehicle intenders in 73 cities. They study includes 67 brands and 200 models in 17 vehicle segments. The study was conducted online from May to June 2014.

About JD Power Asia Pacific: www.jdpower.com

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The Internet Has the Greatest Impact among All Media Channels On Shoppers’ New-Vehicle Purchase Decisions

2014-08-14

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Shanghai: 15 August 2014 — The Internet has the greatest impact among all media channels on the new-vehicle purchasing decision, especially among young vehicle buyers who were born in the 1980s and 1990s, according to the JD Power Asia Pacific 2014 China Auto Media Study ^SM (AMS) released today.

The study provides a comprehensive and strategic perspective regarding the role of media, including online, TV, outdoor, newspapers/magazines, radio and smartphone, in new-vehicle purchase decision-making process. Manufacturers and advertising agencies can use study findings in developing vehicle-buyer targets by examining the attitudinal, lifestyle, recreational and media consumption behaviors of their targeted audience.

With the fast development and penetration of Internet and digital media, consumers are spending more time on digital platforms during the new-vehicle shopping process. Among the various digital platforms, the Internet has the greatest impact on the vehicle-purchasing decision, as 60 percent of consumers say that the Internet is “somewhat impactful” or “very impactful” in helping them decide which vehicle they want to purchase; whereas 41 percent of consumers indicate that traditional media (TV, newspaper and magazine) is “somewhat impactful” or “very impactful” on the vehicle-purchasing decision.

Vehicle buyers are using the Internet during the shopping process to access a range of information related to the type of vehicle they are considering. Most buyers compare models, view pictures and check prices, as well as search for dealer information and vehicle ratings and reviews.

The Internet platforms new-vehicle shoppers visit vary greatly. General websites, search engines and WeChat are used by more than 80 percent of vehicle buyers. The most frequently visited platform among those top three categories is WeChat (seven times per week, on average). The WeChat usage rate is highest among younger buyers (born 1980-1999), with 60 percent of these buyers indicating they use the website at least once per day. Among buyers born 1950-1959, 34 percent use WeChat daily.

“Manufacturers need to pay close attention to their websites and social media platforms, and create compelling content for potential buyers,” said Dr. Mei Songlin, vice president and managing director at JD Power Asia Pacific. “Content-rich sites that engage consumers early in their vehicle-shopping process have the most impact and influence on their purchase decisions.”

KEY FINDINGS

• Tencent, Sina and Sohu are the three most frequently visited website portals among vehicle buyers. Buyers visit Tencent an average of 4.5 times per week, Sina an average of 3.7 times per week, and Sohu an average of 3.1 times per week. Among vertical websites, Autohome has the highest usage rate (87%), followed by BitAuto (68%) and Pacific Auto (54%).
• ŸOne reason for the growing popularity of social media is that it allows users to easily post information and share their experiences. When asked which social network they most often use to share their purchasing experiences, most vehicle buyers across all age groups cite WeChat, followed by Weibo and auto forums.

The 2014 China Auto Media Study is based on responses from 15,388 vehicle owners who purchased their new vehicle between July 2013 and February 2014. The study was fielded from January 2014 to April 2014 in 51 major cities across China.

About JD Power Asia Pacific: www.jdpower.com

About JD Power and Advertising/Promotional Rules www.jdpower.com/about-us/press-release-info

About McGraw Hill Financial www.mhfi.com 

Retail Banking Satisfaction Remains Stable;Internet Financial Products Create Competition for Retail Banking

2014-07-17

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Shanghai: 18 July 2014 — Retail banking customer satisfaction in 2014 remains stable, while high customer awareness and penetration of Internet financial products create competition for retail banking, according to the JD Power Asia Pacific 2014 China Retail Banking Satisfaction Study^SM (RBSS).

Now in its sixth year, the study[1] measures customer satisfaction with their bank across six factors: transactions; product offerings; account information; facility; fees; and problem resolution. Additionally, the study examines performance-improvement initiatives designed to drive customer loyalty and advocacy.

Customer satisfaction in 2014 remains relatively stable, declining by only 8 points from 2013 (761 vs. 753, respectively, on a 1,000-point scale). Satisfaction has also declined across all six factors, most notably in fees (-18 points) and product offerings (-11). Mobile (834) is the only sub-factor within transactions to improve, increasing by 7 points due to an increase in usage among retail banking customers, despite being a relatively new method for conducting transactions.

Internet finance, an emerging financial service separate from conventional banking service, has garnered wide attention in the market. Among all existing Internet financial products,[2] 95 percent of the customers state that they are aware of one or more Internet financial products.  Internet financial products have also achieved a high usage adoption rate (61%) among retail banking customers in China. More than four in five (84%) customers who have used these products indicate they intend to continue using the same holdings or add more Internet financial products.

Internet finance is beginning to influence the retail banking customer experience, especially customers who are 35-49 years old. This age group retains the highest income as well as the highest percentage enrolled in VIP programs. Retail banking satisfaction of these customers who use Internet financial products is lower than among those who do not (754 vs. 769, respectively).

“Considering its convenience and no limitation on purchasing, customers have tended to shift their savings over to Internet financial products,” said Steven Zou, director of the services industry at JD Power Asia Pacific, Beijing. “With more competitive choices for customers, banking has to provide better personalized customer experience and innovative products to differentiate and retain those important customers.”

Retail Banking Customer Satisfaction Ranking

• Bank of Communications (808) ranks highest and performs particularly well in the most impactful factor, transactions (48 points above average), as well as in facility (+38) and account information (+38). 
• Shanghai Pudong Development Bank (802) ranks second and performs well in problem resolution (99 points above average). China Everbright Bank (799) ranks third, performing well in product offerings (+65 points), followed by Hua Xia Bank (798) with a strong performance in fees (+133) and problem resolution (+99).
• Customers who are highly committed to their bank say they “definitely would” reuse their bank’s service (72%) and recommend the service (69%) to other potential customers, compared to customers with low commitment who are less likely to reuse (11%) and recommend (12%).

The 2014 China Retail Banking Satisfaction Study, which examines 15 leading banks operating in China, is based on responses from 9,120 retail banking customers in 30 cities. The study was fielded between April and June 2014.

About JD Power Asia Pacific: www.jdpower.com

About JD Power and Advertising/Promotional Rules www.jdpower.com/corporate

About McGraw Hill Financial www.mhfi.com 

[1] The study was redesigned in 2014 to include only one award. In previous years, the study included two segments: shareholder banks and state-owned banks.

[2] Internet financial products are Internet wealth management products such as Yu’e Bao, Xianjin Bao and Baidu Finance.

After-Sales Customer Satisfaction Increases in China; Gap in Customer Service Satisfaction between Luxury and Mass Market Brands Narrows

2014-07-25

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Shanghai: 31 July 2014—Overall customer satisfaction with after-sales service at authorized dealerships in China increases in 2014, and the gap in satisfaction between the luxury and mass market segments narrows, according to the JD Power Asia Pacific 2014 China Customer Service Index (CSI) Study^SM.

The study, now in its 14^th year, measures satisfaction among vehicle owners who have owned their vehicle between 12 and 24 months and who visited an authorized dealer’s service department for maintenance or repair work during the last six months. The 12 to 24 month ownership period typically represents a substantial portion of the vehicle warranty period. The study examines five factors to determine overall satisfaction with dealer service (in order of importance): service quality (24%); service facility (21%); vehicle pick-up (21%); service advisor (18%); and service initiation (17%). The customer satisfaction score measures the performance among authorized dealers on meeting customers’ expectations of their after-sales experience.

Customer satisfaction with luxury brands improves to 855 (on a 1,000-point scale) from 849 in 2013, and satisfaction with mass market brands increases to 824, up from 811 last year. The gap in customer service satisfaction between luxury and mass-market brands narrows to 31 points in 2014 from 38 points in 2013.

“Mass market vehicle brands have improved their service satisfaction and are proving fierce market competition for luxury brands,” said Dr. Mei Songlin, vice president and managing director at JD Power Asia Pacific. “However, in order to satisfy increasing customer needs and expectations, all vehicle brands must strive to improve after-sales service.”

Key Findings

The study identifies 18 key performance indicators (KPIs) that contribute to overall customer satisfaction with the after-sales service experience. When 15 or more KPIs are implemented in the mass market segment, satisfaction scores exceed the mass-market average. Nearly one-half (49%) of mass market vehicle owners indicate their authorized dealership met at least 15 KPIs during their service experience in 2014, a 23 percent increase from 2013.

ŸCustomers value fast service from their dealership. In the mass market segment, quick/ express service has the highest impact on overall satisfaction. The study finds that when maintenance/ repair is completed within two hours on the same day, customer satisfaction is 828; however, when completed less than one hour, satisfaction increases to 855, which is 31 points higher than the segment average (824). 

ŸCustomer satisfaction with their after-sales experience has a direct impact on dealers’ service volume. Service volume among dealers with high satisfaction scores (845 points and above) averages 1,343 units per month, which is 26 percent higher than service volume of dealers with low satisfaction scores (782 and below). Dealerships with high satisfaction scores also generate considerably higher after-sales revenue (average 10.7 million RMB), which is approximately 27 percent higher than dealers with low scores.

ŸThere is a strong correlation between customer satisfaction and customer loyalty. More than one-half (51%) of mass market customers who are highly satisfied with their brand say they “definitely would” revisit the dealer for post-warranty service, which is more than double the percentage of mass market customers with low satisfaction (24%).

CSI Study Rankings

Audi ranks highest among luxury brands with a score of 912, followed by Cadillac (864) and Infiniti (863).

Dongfeng Peugeot and Guangqi Honda rank highest (in a tie) among mass market brands (906 each), and Dongfeng Citroen ranks third (898).

The 2014 China Customer Service Index Study is based on street intercept and face-to-face interviews with 16,928 new-vehicle owners who purchased their vehicle between February 2012 and May 2013, and examines 67 passenger vehicle brands. The study was fielded between February and May 2014 in 46 major cities in China.

About JD Power Asia Pacific: www.jdpower.com

About JD Power and Advertising/Promotional Rules www.jdpower.com/corporate

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Amidst Beijing Auto Show Product Celebration, the Industry is Experiencing Declining Dealership Profits

1970-01-01

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BEIJING: 22 April 2012 — A changing economic and regulatory environment, coupled with more products and dealerships, have led China vehicle dealers to report lower profits on 2011 operations, compared with 2010, according to the JD Power Asia Pacific 2012 China Dealer Attitude Study^SM.

Findings from this annual study on automotive dealer sentiment, which this year includes 1,605 dealers of 38 different brands in 59 cities in China, indicate the percentage of dealers reporting they were profitable in 2011 fell to 63 percent, compared with 81 percent a year ago, and 20 percent of dealers report they lost money on their operations–up from 9 percent in the 2011 study. 

“These profit findings are troubling to more than just dealers,” said Charles Mills, vice president, global retail experience at JD Power and Associates. “Brands need dealers to continue to invest to meet their market potentials, and China customers increasingly expect more from their dealership experiences. This puts brands with lower dealer profitability at a disadvantage relative to competitors.”

Entry-Level Segment Sales Hardest Hit

China new-vehicle sales in the first quarter of 2012 increased by just 2 percent from the same period last year. The sluggish sales growth has affected entry-level vehicle segments more than other segments, despite a continued increase in retail gas prices in China. Fuel prices in China are now more than 20 percent higher than the average price in the United States.

Typically, consumers trade down to smaller, cheaper and more fuel-efficient vehicles when gas prices rise, but current China market dynamics are challenging this trend. Luxury vehicle sales are continuing to surge, driven by consumers with deep pockets who are less price sensitive, and manufacturer-provided dealer incentives have lowered consumer-facing transaction prices. By contrast, entry-level vehicles are falling victim to the gas-price increase as consumers exhibit a greater level of price sensitivity. 

The three entry-level vehicle segments–minicars, sub-compact and compact–account for 55-60 percent of China passenger-vehicle sales, according to LMC Automotive’s China analyst, John Zeng. Sales of entry-level vehicles in the first three months of 2012 declined by 5 percent from the same period last year. Minicars led the deceleration among these three segments, with a 30 percent decline in sales versus the same three-month period in 2011. China domestic-brand sales have been strongly impacted by this situation, as has their dealerships’ profitability.

On average, dealerships in China currently derive 40 percent of their profits from new-vehicle sales, a proportion significantly higher than in mature markets. As the China automotive market continues to evolve, it is expected that dealerships will gain greater profits from vehicle financing, used-vehicle sales and service and parts. These revenue streams tend to be more profitable than new-vehicle sales, enabling dealerships’ profitability to better weather any sales volatility.
 

The World’s Largest Auto Market Shifts Gear

Currently, new-vehicle shoppers in China have the world’s widest range of choices, with 94 brands and 476 models from which to choose. That compares with fewer than 40 brands and nearly 100 fewer models available in the U.S. market, the second-largest automotive market in the world in 2011.

LMC Automotive forecasts a nine percent growth in passenger-vehicle sales in 2012, a much lower rate than in previous years when China’s new-vehicle sales surged at double-digit rates. China’s passenger-vehicle market is expected to grow at a compounded annual rate of 12.4 percent during the next four years and will reach an estimated 20.9 million units annually by 2015.

Voice of the Dealer Critical to Automakers

Other findings from the 2012 Dealer Attitude Study provide indicators for what dealers perceive is required for improved profitability. Greater support from automakers, in the form of marketing and incentives; continued focus on product quality; and personnel training are all areas of great importance to dealers this year. The importance of automaker support is emphasized by a finding that indicates there is a strong relationship between dealer perceptions of automakers’ performance and dealer profitability, with dealers who are “delighted” (providing a satisfaction rating of 10 on a 10-point scale) with their brand indicating they are more profitable, compared with dealers who provide lower ratings for satisfaction. The brands with the highest level of dealers who are “delighted” also tend to perform well in JD Power studies on China automotive customer satisfaction.

“Great products are critical, but are only one part of the long-term success equation. Healthy, vibrant dealerships that help differentiate products in this incredibly competitive market are also critical to protecting automotive investments,” said Mills.

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected]

About JD Power and Associates

Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction.  The company’s quality and satisfaction measurements are based on responses from millions of consumers annually.  For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial’s leading brands include Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services and JD Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

About LMC Automotive

LMC Automotive, formerly JD Power Automotive Forecasting, is the premier supplier of automotive forecasts and intelligence to an extensive client base of automotive manufacturer, component suppliers, logistics and distribution companies, as well as financial and government institutions around the world. Its global forecasting services encompass automotive sales, production and powertrain expertise, as well as advisory capability. LMC Automotive has offices in the U.S., the UK, Germany, China and Thailand. It is part of the Oxford, UK-based LMC group, the global leader in economic and business consultancy for the agribusiness sector.

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No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. www.jdpower.com/corporate

Purchase Consideration for European Models Is Notably Increasing, While Consideration for Japanese Models Is Decreasing

1970-01-01

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SHANGHAI: 29 June 2012 — The percentage of consumers in China who intend to purchase a new European vehicle has increased notably to 35 percent in 2012 from 25 percent in 2009, according to the JD Power Asia Pacific 2012 China New-Vehicle Intender Study^SM (NVIS) released today.

The study, now in its fourth year, examines pre-purchase perceptions and considerations among consumers in China who intend to purchase a new vehicle within the next 12 months. The study is designed to provide key consumer insights by examining brand awareness, purchase consideration, rejection reasons and media usage, as well as consumer perceptions of various models among these new-vehicle intenders. A total of 52 vehicle brands and 171 models in 11 vehicle segments are included in the 2012 study.

The consideration rates of European models, led by German brands, have increased the most among new-vehicle intenders in China. German models have the highest consideration rates in seven of the 11 segments. German models are more popular, particularly in Tier 1 cities in China, compared with models of other European brands, a 32 percent consideration rate among new-vehicle intenders.

The primary reasons for considering a German model include safety features; quality of workmanship; and durability and low failure rate.

The study finds a high correlation between brand consideration rates and actual sales. In the first five months of 2012, sales of German models in China have increased by 221,000 units, representing a 22 percent year-on-year increase, according to LMC Automotive.¹

Volkswagen models have the highest consideration rates in the entry mid, mid, upper premium mid and SUV segments, while Audi models are most often considered in the entry luxury, luxury and luxury SUV segments.  

Roewe 550 and FAW Oley B30, both domestic brands in China, have the highest consideration rates in the lower premium mid segment and premium compact segment, respectively.

In contrast, the consideration rate of Japanese models has decreased to 24 percent in 2012 from 32 percent in 2009.

Models with the highest levels of consideration in each vehicle segment are:

• Compact: Chevrolet Spark
• Premium compact: FAW Oley B30
• Entry mid: Volkswagen Polo
• Mid: Volkswagen Lavida
• Lower premium mid: Roewe 550
• Upper premium mid: Volkswagen New Passat
• Entry luxury: Audi A4L
• Luxury: Audi A6L
• SUV: Volkswagen Tiguan
• Luxury SUV: Audi Q5
• MPV: Honda Odyssey

Raising a model’s consideration rate has proven to be a fierce battle for automakers and involves significant marketing expenses. Throughout May 2012, there are 287 models² in China’s automotive market vying for consumer attention, while only 2.6 models, on average, are in the consideration set of new-vehicle intenders. The probability of a model being included in an intender’s consideration set is approximately 0.9 percent of all the models existing in the market.

Safety and quality are the top criteria among new-vehicle intenders in China. More than three in five (66%) premium segment intenders and 72 percent of non-premium segment intenders consider a model because of its reputation for quality and safety. Quality of workmanship and durability and low failure rate, which relate to quality and safety, are top consideration reasons.

“Understanding what is top of mind with vehicle intenders helps automotive manufacturers focus their marketing messages,” said Scott Lu, senior automotive analyst at JD Power Asia Pacific, Shanghai. “Manufacturers should focus on the specific consideration cues for a particular segment to better appeal to the target market.”

For premium brands, quality and safety; performance and configuration; and brand and image are considered critically important by new-vehicle intenders in the consideration stage. For non-premium brands, quality and safety; performance and configuration; and price are the primary consideration reasons. While manufacturers’ promotions are a determining factor in influencing intenders to buy a vehicle, they do not play a significant role in consideration.

Manufacturers of models in each vehicle segment should focus on specific features to effectively target those new-vehicle intenders. For example, price and fuel economy are important features among intenders who are considering small cars. In contrast, intenders who are considering luxury vehicles place importance on brand and image.

“As manufacturers tailor their marketing messages to attract customers to dealerships and dealers are better able to close sales, attention should also focus on eliminating specific concerns of targeted intenders, such as price and fuel consumption,” said Dr. Mei Songlin, general manager of research services at JD Power Asia Pacific, Shanghai.

The study also finds that the Internet and TV are the most effective channels for connecting with and influencing new-vehicle purchase intenders. In particular, the Internet remains the most influential communication channel. More than two-thirds (69%) of new-vehicle intenders obtain brand information from the Internet, while 58 percent gain information through TV commercials.

The study also measures familiarity and favorability of automotive brands among new-vehicle intenders in China. By examining Brand Influence Scores, the study finds most intenders aspire to own BMW, Mercedes-Benz and Audi. BMW achieves a Brand Influence Score of 705 on a 1,000-point scale, followed by Mercedes-Benz (696) and Audi (664).

The 2012 China New Vehicle Intender Study is based on responses from 5,319 new-vehicle intenders in 59 cities. The study was fielded from February to March 2012.

The New-Vehicle Intender Study is one of eight consumer-based benchmark studies conducted by JD Power in China. Other 2012 studies conducted by JD Power Asia Pacific include:

• The China Customer Service Index (CSI) Study, which examines customer satisfaction about after-sales service, will be released in end July.
• The China Sales Satisfaction Index (SSI) Study, which measures satisfaction with the new-vehicle sales process, will be released in mid August.
• The China Original Equipment Tire Satisfaction Study, which measures customer satisfaction on original equipment tires, will be released in September.
• The China Initial Quality Study (IQS), which measures problems experienced by new-vehicle owners during the first two to six months of ownership, will be released in late October.
• The China Automotive Performance, Execution and Layout (APEAL) Study, which measures what excites and delights owners about their new-vehicle’s performance and design during the first two to six months of ownership, will be released in late November.
• The China Vehicle Dependability Study (VDS), which evaluates overall vehicle dependability during the first 13-36 months of ownership, will be published in mid December.
• The inaugural China Service Loyalty Study (SLS), which measures customer loyalty toward authorized dealerships during the first 13 to 36 months of ownership, will be released in December.

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide performance analytics services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in Australia, China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan, Thailand and Vietnam. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected].

About JD Power and Associates

Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial’s leading brands include Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services and JD Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

About LMC Automotive

LMC Automotive, formerly JD Power Automotive Forecasting, is the premier supplier of automotive forecasts and intelligence to an extensive client base of automotive manufacturer, component supplier, logistics and distribution companies, as well as financial and government institutions around the world. LMC’s global forecasting services encompass automotive sales, production and powertrain expertise, as well as advisory capability. LMC Automotive has offices in the United States, the UK, Germany, China and Thailand and is part of the Oxford, UK-based LMC group, the global leader in economic and business consultancy for the agribusiness sector.  For more information please visit www.lmc-auto.com

Media Relations Contacts:

Ms. Ellen Wang; Public Relation Supervisor; JD Power Asia Pacific; Shanghai, 200040 China; +86 21 2208 0831; [email protected]

John Tews; Director, Media Relations; JD Power and Associates; Troy, Michigan 48098 USA; 001 248 312 4119; [email protected]

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. www.jdpower.com/corporate.

After-Sales Dealer Service Satisfaction in China Plateaus After Six Consecutive Years of Increases

1970-01-01

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SHANGHAI: 30 July 2012 — After six consecutive years of steady increases, overall customer satisfaction with after-sales service with authorized dealers in China has plateaued in 2012, according to the JD Power Asia Pacific 2012 China Customer Service Index (CSI) Study^SM.

The China Customer Service Index Study, now in its 12th year in China, measures satisfaction among vehicle owners who visit an authorized dealer’s service department for maintenance or repair work between 12 and 24 months of ownership, which typically represents a substantial portion of the vehicle warranty period. The study examines five measures to determine overall satisfaction with dealer service. These include: service quality; vehicle pick-up; service initiation; service advisor; and service facility.

Overall customer satisfaction with dealer service in China declined to 832 points on a 1,000-point scale in 2012, from 833 points in 2011. After years of posting substantial annual gains, this year’s result marks the industry’s first decline in satisfaction since 2006.

Based on JD Power’s analysis, this slight decline is likely a result of the industry’s inability to keep pace with China’s explosive vehicle sales pace in recent years, which saw nearly 40 million new passenger vehicles added to China’s roads in just the last four years.

As China’s passenger vehicle sales increase, the total number of vehicles on the road may be increasing faster than the industry’s capacity to add qualified dealers to service these vehicles at levels that consumers have come to expect. This market dynamic has led to lower levels of customer satisfaction with service advisors, and service facilities, in particular.   

To keep pace with growing consumer demand for passenger vehicles over the past few years automakers in China have aggressively expanded their dealer networks. In 2011, the number of authorized dealers increased by 14 percent compared to 2010, according to JD Power’s China Dealer Attitude Study.

Moreover, despite the addition of new dealerships, the volume of customers received by each service advisor on average has increased by 10 percent, thus putting greater strain on the ability of dealers to provide a timely and customer-focused service experience.

“Our research has shown that customer satisfaction with the dealership has a significant impact on owner loyalty and brand advocacy,” said Justin Min, senior automotive analyst for JD Power Asia Pacific Shanghai.

On average, service volume with dealers in the high satisfaction tier is 40 percent higher than among dealers in the average satisfaction tier. Among customers of dealers in the high satisfaction tier (854 points and higher), more than 72 percent indicate they “definitely would” stay with their current service dealer for warranty service, while 47 percent indicate they “definitely would” use the dealer for post-warranty service, and these patterns are similar for repurchase behavior and advocacy. Among customers in the low satisfaction tier (793 points or less), the percentage of those who state they “definitely would” revisit the service dealer for warranty service drops to 51 percent and post-warranty service usage drops to 24 percent.

“Providing high levels of customer service among an increasing number of new dealerships with higher sales volumes is clearly a challenge,” said Min. “Those brands that can successfully manage this expansion will be better positioned for growth as the industry evolves”.

Dealers of Japanese brands rank among the top three rank positions in customer satisfaction with the after-sales service experience. Guangqi Honda ranks highest overall with a score of 905, and performs particularly well in three of five measures in the study: service initiation, service advisor and service facility. Dongfeng Honda and GAC Toyota rank second in a tie with 887 points, followed by Dongfeng Citroen (885), and Dongfeng Peugeot (881).

After-sales service satisfaction with authorized dealers of international brands (brands with headquarters located outside of China) decreased by one point in 2012, while satisfaction with dealers of Chinese domestic brands decreased by nine points. The gap in satisfaction scores between international and domestic brands widened to 73 points from 65 points in 2011.  

“With the growth of new vehicle sales slowing down, after-sales service has become an increasingly important profit source for dealers,” said Dr. Mei Songlin, vice president and managing director of JD Power China Operations. “Profit margins from new-vehicle sales have decreased in recent years. As a result, after-sales service is becoming one of the backbones for dealers to sustain growth amid fierce competition.”

After-sales service currently accounts for 44 percent of dealer profit, according to the 2012 JD Power China Dealer Attitude Study. According to JD Power, the percentage is expected to continue to increase as new-vehicle prices decline and profit shrinks.

“Thus, the importance of dealership service satisfaction is paramount for the health of the dealer body and by extension, automakers,” said Dr. Mei.

The 2012 China Customer Service Index (CSI) Study is based on street intercept and face-to-face interviews with 14,657 new-vehicle owners who purchased their vehicle between February 2010 and May 2011, and examines 68 passenger vehicle brands. The study was fielded between February and May 2012 in 37 major cities in China.

The Customer Satisfaction Index study is one of eight consumer-based benchmark studies conducted by JD Power Asia Pacific in China. Other 2012 studies conducted by JD Power Asia Pacific in the country include:

• China New-Vehicle Intender Study (NVIS), which examines pre-purchase perceptions and considerations, was released in end June.
• The China Sales Satisfaction Index (SSI) Study, which measures satisfaction with the new-vehicle sales process, will be released in mid August.
• The China Original Equipment Tire Satisfaction Study, which measures customer satisfaction on original equipment tires, will be released in September.
• The China Initial Quality Study (IQS), which measures problems experienced by new-vehicle owners during the first two to six months of ownership, will be released in late October.
• The China Automotive Performance, Execution and Layout (APEAL) Study, which measures what excites and delights owners about their new-vehicle’s performance and design during the first two to six months of ownership, will be released in late November.
• The China Vehicle Dependability Study (VDS), which evaluates overall vehicle dependability during the first 25-36 months of ownership, will be published in mid December.
• China Service Loyalty Study (SLS), which measures customer loyalty toward authorized dealerships during the first 25 to 36 months of ownership. The study will be released in January 2013.

About JD Power Asia Pacific JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected].

About JD Power and Associates

Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction.  The company’s quality and satisfaction measurements are based on responses from millions of consumers annually.  For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial’s leading brands include Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services and JD Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

Media Relations Contacts:

Ms. Ellen Wang; Public Relation Supervisor; JD Power Asia Pacific; Shanghai, 200040 China; +86 21 2208 0831; [email protected]

John Tews; JD Power and Associates; Troy, Mich.; (248) 680-6218; [email protected]

Follow us on Twitter: @JDPower

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. www.jdpower.com/corporate

Domestic Brands in China Narrow Initial Quality Gap with International Brands, As Industry-Wide Problem Rate Declines to Historic Low

1970-01-01

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SHANGHAI: 31 October 2012 — Automakers in China achieve significant improvements in initial quality this year, narrowing the gap between domestic and international brands and driving the overall industry average problem rate in that market to a record low, according to the JD Power Asia Pacific 2012 China Initial Quality Study^SM (IQS) released today.  

The study, now in its 13th year, examines problems experienced by new-vehicle owners within the first two to six months of ownership. The study examines problems experienced by owners in two distinct categories: design-related problems and defects and malfunctions. The overall initial quality score is determined by problems reported per 100 vehicles (PP100), with a lower rate of problem incidence indicating higher quality.

Initial quality of domestic brand models increases significantly in 2012, following a higher number of owner-reported problems experienced in 2011. Overall initial quality of domestic brands improves to 212 PP100 in 2012 from 232 PP100 in 2011, narrowing the gap with international brands to 95 PP100. Initial quality of international brands also improves year over year, to 117 PP100 in 2012 from 131 PP100 2011.

“Chinese domestic brands outpace the industry quality improvement in 2012,” said Dr. Mei Songlin, vice president and managing director of JD Power China Operations. “We are seeing remarkable improvements, particularly in the areas of ease in shifting gears with manual transmission, less incidence of brake dust and improved fuel efficiency. Yet despite this historic milestone for Chinese brands as a whole, no domestic nameplate exceeds the industry average in initial quality. This signals significant room for continued future improvement.”

Overall initial quality across the industry averages 146 PP100 in 2012, which represents the lowest number of problems since the inception of the study in 2000. Initial quality has improved by an average of 16 PP100 from 2011, largely driven by improvements among Korean and Chinese domestic brands.

The industry-wide improvement in initial quality is also due to the growing shift among vehicle owners from purchasing lower-end models to purchasing higher-end models, which consistently have fewer initial quality issues. The market share of vehicles in the SUV and luxury segments (including entry luxury, luxury and luxury SUV) have increased by 4 percent and 3 percent, respectively, from 2011, according to LMC Automotive, JD Power’s strategic partner in automotive intelligence and forecasting.  Average PP100 scores in the SUV and luxury segments are 136 PP100 and 73 PP100, respectively, which are significantly lower than scores in the compact (233 PP100) and mini van (191 PP100) segments, whose market shares have declined by 1 percent and 4 percent, respectively, from 2011.

Korean brands have the highest overall initial quality at 93 PP100, an improvement of 31 PP100 from 2011. In contrast, initial quality for Japanese brands–which follow Korean brands when examining quality by manufacturer origin–declines slightly year over year to 113 PP100 in 2012 from 108 PP100 in 2011.

Maintaining high initial quality is critical to both retaining existing customers, as well as attracting new customers. According to the JD Power Asia Pacific 2012 China Sales Satisfaction Index (SSI) Study SM, vehicle quality is among the top three drivers of purchase decisions made by new-vehicle buyers. The 2012 China IQS finds that among owners who have a problem-free experience with their vehicle, 36 percent indicate they “definitely will” recommend their brand to others, while 18 percent indicate they “definitely will” repurchase the brand. In contrast, among owners who experience more than one problem with their vehicle, the rates of those who say they “definitely will” recommend and repurchase decline to 27 percent and 13 percent, respectively.

“To further improve customer experiences with initial quality, focus should be placed on the most bothersome and most frequently reported problems experienced by vehicle owners,” said Tony Zhou, automotive research director at JD Power China Operations.  

Excessive fuel consumption has remained the most frequently reported problem since 2007. However, engine power loss associated with the air conditioning ties with excessive fuel consumption as the most frequently reported problems in 2012. New-vehicle owners in China tend to be particularly sensitive to noise problems, with brake noise, wind noise, engine noise and fan/blower noise accounting for four of the top 10 most commonly reported problems.

“The automotive industry in China still has a lot of room for improvement, as it continues to lag behind such mature markets as the United States in initial quality,” said Zhou. “It is important for automakers to focus on defects and malfunctions, but improving design quality to make vehicles more user-friendly may also help reduce the number of problems owners experience.”

2012 China IQS Ranking Highlights

Lexus is the highest-ranked nameplate in the study in initial quality, averaging 54 PP100. Lexus also ranks highest in the JD Power and Associates 2012 U.S. Initial Quality Study^SM (IQS). Mercedes-Benz (72 PP100) ranks second highest, followed by BMW (74 PP100) and Audi (76 PP100). Dongfeng Honda (88 PP100) ranks fifth overall.  

The model-level rankings show considerable global diversity. Among the 215 models examined in the study, two models from Beijing Hyundai (Hyundai Moinca; Hyundai Sonata) rank highest in two segments; and Dongfeng Yuedai Kia (Kia K2) ranks highest in a segment. Japanese brands FAW Toyota (RAV4), Dongfeng Honda (Civic) and Changan Suzuki (Alto) each garner one model-level award. U.S. brand Shanghai GM earns two awards (Chevrolet Sail and Buick GL8). German brand BMW (7 Series) receives one award. China domestic brand Wuling (Hongguang) receives one award.

In total, 10 vehicle segments are eligible for awards in the 2012 China IQS. Models ranking highest overall in their respective segments include:

1. Compact: Suzuki Alto
2. Premium Compact: Chevrolet Sail
3. Entry Midsize: Kia K2
4. Midsize: Honda Civic
5. Lower Premium Midsize: Hyundai Moinca
6. Upper Premium Midsize: Hyundai Sonata
7. Luxury: BMW 7 Series
8. SUV: Toyota RAV4
9. MPV: Buick GL8
10. Mini Van: Wuling Hongguang

The 2012 China Initial Quality Study (IQS) is based on evaluations from 20,639 owners of new vehicles purchased between October 2011 and June 2012. The study analyzes models in 12 vehicle segments and includes 215 different passenger-vehicle models covering 68 different makes. The study was fielded from April 2012 to August 2012 in 43 major cities across China.

JD Power Voice-of-the-Customer benchmark studies evaluate products and services based on consumer feedback on their experiences to help businesses make informed decisions about product and service improvements. The research is conducted through an entirely independent process that is funded by JD Power, which is key to the company’s independence and unbiased position. Typically, studies are derived from a random national sample of customers who use products and services across a number of industries. Study results are based solely on the opinions of customers. The opinion of JD Power is not included in the study results.

The China Initial Quality Study (IQS) is one of the consumer-based benchmark studies conducted by JD Power Asia Pacific in China. Other 2012 studies conducted by JD Power Asia Pacific include:

1. The China New-Vehicle Intender Study (NVIS), which examines pre-purchase perceptions and considerations, was released in June.
2. The China Customer Service Index (CSI) Study, which examines satisfaction with the after-sales service experience among vehicle owners between 12 and 24 months of ownership, was released in July.
3. The China Sales Satisfaction Index (SSI) Study, which measures satisfaction with the new-vehicle sales process, was released in August.
4. The China Automotive Performance, Execution and Layout (APEAL) Study, which measures what excites and delights owners about their new-vehicle’s performance and design during the first two to six months of ownership, will be released in late November.
5. The China Vehicle Dependability Study (VDS), which evaluates overall vehicle dependability during the first 25-36 months of ownership, will be released in mid December.

JD Power Asia Pacific today announced the launch its corporate weibo (a Chinese microblogging website). For more information about the China Initial Quality Study (IQS), please follow JD Power at http://e.weibo.com/jdpowerchina.

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected] . Please follow JD Power at http://e.weibo.com/jdpowerchina.

About JD Power and Associates

Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction.  The company’s quality and satisfaction measurements are based on responses from millions of consumers annually.  For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

McGraw-Hill announced on September 12, 2011, its intention to separate into two companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial’s leading brands include Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, JD Power and Associates and Platts, a leader in commodities information.  With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

Follow us on Twitter: @JDPower

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. www.jdpower.com/corporate

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Damage from Puncture is Reported as the Top Problem with Original Tires in China

1970-01-01

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SHANGHAI: 25 September 2012 — One in five Chinese vehicle owners report damage from puncture as the top problem with their vehicle’s original tires, according to the JD Power Asia Pacific 2012 China Original Equipment Tire Satisfaction Index Study^SM

The China Original Equipment Tire Satisfaction Index Study measures satisfaction among original equipment tire owners during the first 12 to 24 months of ownership. The study measures overall satisfaction across four factors: appearance; durability; traction/handling; and ride.

Overall customer satisfaction with original tires averages at 801 on a 1,000-point scale. Of the four factors examined in the study, customers express the highest satisfaction toward appearance (814), followed by durability (807) and traction/handling (789). Customer satisfaction with ride is the lowest (788).
 
More than 20 percent of consumers (22%) experienced damage from puncture, topping the list of 19 problems examined in the study.

“The percentage of customers experiencing damage from puncture is quite alarming, considering the safety accidents such damage may bring about,” said Dr. Mei Songlin, vice president and managing director of JD Power China Operations. “Tire manufacturers should focus on improvement in tire quality to reduce the safety risks.”

Stones getting caught in the tread is reported as the second frequently experienced problem in among Chinese vehicle owners (9%), followed by road hazard damage (5%).

Most tire products in the market were originally designed overseas and imported to China, said Dr. Mei. In addition to improving tire manufacturing quality, he urges efforts in localizing the tire design in view of the local road conditions in China.

Yokohama ranks in customer satisfaction among the 19 tire brands examined in the study with an index score of 843.  Yokohama performs particularly well in the durability, traction/handling and ride factors. Dunlop ranks second at 837, followed by Bridgestone and Continental, in the tie, with 833.

When examining satisfaction by the tire brand origin, Japanese tire brands collectively achieve a satisfaction score of 834 points, the highest among all the tire brands in China. European brands and U.S. brands trail at 833 and 817 points, respectively. The study finds Japanese tire brands perform especially well in appearance, durability and ride.

The study also indicates that tire brands that achieve high levels of customer satisfaction benefit financially from higher levels of customer loyalty and advocacy. When car owners are more satisfied with their original tires, they are more likely to repurchase their same tire brand in the future. Among customers who are highly satisfied (856 points and higher), more than 36 percent claim they “definitely would” stay with their current tire brand. When overall satisfaction is low (683 points or less), only 5.3 percent of customers state they “definitely would” repurchase the brand of tire.

“Highly satisfied customers with original tires brings more after-sales business for dealers,” says Liza Wang, senior analyst at JD Power Asia Pacific, Shanghai. “The study finds that replacement rate with the same tire brand is 26 percent higher among customers who are delighted with their original tires, compared with those who voiced disappointment.”

The study is based on responses from 12,066 new-vehicle owners who purchased their vehicle between February 2010 and May 2011. The study was fielded between February and May 2012 in 37 major cities in China, covering 187 vehicle models in total.

The China Original Equipment Tire Satisfaction Index Study^SM is one of eight consumer-based benchmark studies conducted by JD Power Asia Pacific in China. Other 2012 studies conducted by JD Power Asia Pacific in the country include:

1. China New-Vehicle Intender Study (NVIS), which examines pre-purchase perceptions and considerations, was released in end June.
2. The China Customer Satisfaction Index (CSI) Study, which examines satisfaction with the after-sales service experience among vehicle owners between 12 and 24 months of ownership, was released in late July.
3. The China Sales Satisfaction Index (SSI) Study, which measures satisfaction with the new-vehicle sales process, was released in mid August.
4. The China Initial Quality Study (IQS), which measures problems experienced by new-vehicle owners during the first two to six months of ownership, will be released in late October.
5. The China Automotive Performance, Execution and Layout (APEAL) Study, which measures what excites and delights owners about their new-vehicle’s performance and design during the first two to six months of ownership, will be released in late November.
6.  The China Vehicle Dependability Study (VDS), which evaluates overall vehicle dependability during the first 25-36 months of ownership, will be published in mid December.
7. China Service Loyalty Study (SLS), which measures customer loyalty toward authorized dealerships during the first 25 to 36 months of ownership. The study will be released in January 2013.

About JD Power Asia Pacific

JD Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan and Thailand. Information regarding JD Power Asia Pacific and its products can be accessed through the Internet at www.jdpower.com. Media e-mail contact: [email protected]

About JD Power and Associates

Headquartered in Westlake Village, Calif., JD Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction.  The company’s quality and satisfaction measurements are based on responses from millions of consumers annually.  For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. JD Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

McGraw-Hill announced on September 12, 2011, its intention to separate into two companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial’s leading brands include Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, JD Power and Associates and Platts, a leader in commodities information. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

Follow us on Twitter: @JDPower

No advertising or other promotional use can be made of the information in this release without the express prior written consent of JD Power and Associates. www.jdpower.com/corporate

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