Category: United States

Consumers Expected to Spend More as Average Vehicle Price Reaches Record Level

2019-07-26

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The Retail Sales Forecast

New-vehicle retail sales in July are expected to fall from a year ago, according to a forecast developed jointly by JD Power and LMC Automotive. Retail sales are projected to reach 1,178,500 units, a 2.0% decrease on a selling day adjusted basis compared with July 2018.

The Total Sales Forecast

Total sales in July are projected to reach 1,397,400 units, a 1.8% decrease compared with July 2018 (selling day adjusted). The seasonally adjusted annualized rate (SAAR) for total sales is expected to be 16.7 million units, flat vs. a year ago.

The Takeaway

Thomas King, Senior Vice President of the Data and Analytics Division at JD Power:
“July will be another month of modest sales declines—but with high vehicle expenditures—as the average new vehicle sales price exceeds $33,000, up over $1,400 from July 2018.”

The jump in sales price is being driven by consumers paying more for recently launched SUVs and more attractive interest rates on new vehicles that help keep monthly payments affordable when purchasing more expensive vehicles.

SUV share of new vehicles sold through mid-July has risen to an all-time high level, accounting for nearly 52% of new-vehicle sales. The growth has been led by several recent launches in the midsize SUV segment, which currently sits at its highest share ever (15.8%). The strong demand for SUVs is coming at the expense of less-expensive sedans which account for approximately 28% of industry retail sales for the third consecutive month.

The average new vehicle sales price is projected to reach $33,182 this month—the highest level ever for the month of July—up more than 4% (+$1,415) from last year. The average price for cars is up 5% to $26,853 while trucks/SUVs are up 3% to $35,487.

Industry incentive spending is rising and is on pace to exceed $4,000 per unit for the month, the highest level since December 2018. However, the increase in incentive spending on a dollar basis is commensurate with the higher-priced vehicles being purchased by consumers. Manufacturer incentive spending as a percentage of MSRP in July is 10%, the same as last year.

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Vehicle shoppers are taking advantage of lower interest rates to finance their vehicles. The average APR for a new vehicle loan so far in July is 5.7%, down more than 50 bps from earlier in the year. Sales with an APR of less than 1% have accounted for 9.2% of new-vehicle loans.

“Despite the continued slow-down in sales, consumers are expected to spend more than $2 billion more on new vehicles than last year,” King said. “This is a clear reflection that manufacturers are building the types of vehicles that shoppers want. Consumer expenditures in July of $39 billion represents the highest level for the month since 2017.” 

Looking forward, August is traditionally one of the busiest sales months of the year. This year, August sales will be inflated by the inclusion of an extra weekend compared to last year, as well as the fact that sales over Labor Day will be included in the manufacturers’ August results. As manufacturers look to take advantage of heavy shopping during the month, a key question is the extent to which they can maintain incentive discipline. The temptation to increase discounts, particularly to clear out inventories of 2019 model-year vehicles will be significant.

Sales & SAAR Comparison

JD Power and LMC Automotive U.S. Sales and SAAR Comparisons

	July 20191	June 2019	July 2018
New-Vehicle Retail Sales	1,178,500 units (-2.0% lower than July 2018)2	1,175,468 units	1,155,047 units
Total Vehicle Sales	1,397,400 units (-1.8% lower than July 2018)2	1,514,494 units	1,366,047 units
Retail SAAR	13.7 million units	13.6 million units	13.6 million units
Total SAAR	16.7 million units	17.3 million units	16.8 million units

¹Figures cited for July 2019 are forecasted based on the first 16 selling days of the month.
²July 2019 has 25 selling days, one day more than July 2018.

The Details

• The average new-vehicle retail transaction price in July is expected to reach $33,065. The previous high for the month of July, $31,767, was set last year.
• Average incentive spending per unit in July is expected to reach $4,074, up from $3,849 last year.
• Consumers are on pace to spend $39 billion on new vehicles in July, up $2.3 billion from last year’s level.
• Truck/SUVs account for 71.7% of new-vehicle retail sales through July 21, the highest level ever for the month of July.
• Days to turn, the average number of days a new vehicle sits on a dealer lot before being sold to a retail customer, is 73 days through July 21. This is up 6 days from last year.
• Fleet sales are expected to total 218,900 units, down 0.4% from July 2018. Fleet volume is expected to account for 16% of total light-vehicle sales, up from 15% last year.

Outlook for the Year

Jeff Schuster, President, Americas Operations and Global Vehicle Forecasts, LMC Automotive:
“There are signals that auto sales in the second half of 2019 are poised to outperform expectations. While trade risk remains a threat, transaction prices continue to rise and economic growth is moderating, sales in the second half of the year could outperform expectations consistent with strength in the previous five years. This year sees higher fleet volume year-to-date, falling interest rates and escalating incentives. It won’t change the fact that the market will be down from 2018, but if consumers respond to the favorable environment, a run-up at the close of 2019 is possible.”

LMC is increasing the forecast for 2019 total light-vehicle sales by 40,000 units to round up to 17.0 million units, a decline of 1.9% from 2018. The increase did not affect the forecast rounding for retail light-vehicle sales, which remains at 13.5 million units, a decline of 3.0% from 2018.

Media Relations Contacts
Geno Effler; JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
Emmie Littlejohn; LMC Automotive; Troy, Mich.; 248-817-2100; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info
About LMC Automotive www.lmc-auto.com

 

 

Mobility Pipe Dreams? JD Power and SurveyMonkey Uncover Shaky Consumer Confidence About the Future

2019-07-29

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COSTA MESA, Calif.: 30 July 2019 — Consumers lack confidence in the future of self-driving vehicles and their outlook isn’t much better about the influx of battery-electric vehicles that manufacturers are spending billions of dollars to bring to market in the next several years, according to the inaugural JD Power 2019 Mobility Confidence Index Study fueled by SurveyMonkey Audience,^SM released today. The Mobility Confidence Index is 36 (on a 100-point scale) for self-driving vehicles and 55 for battery-electric vehicles.

 “Out of the box, these scores are not encouraging,” said Kristin Kolodge, Executive Director, Driver Interaction & Human Machine Interface Research at JD Power. “As automakers head down the developmental road to self-driving vehicles and greater electrification, it’s important to know if consumers are on the same road—and headed in the same direction. That doesn’t seem to be the case right now. Manufacturers need to learn where consumers are in terms of comprehending and accepting new mobility technologies—and what needs to be done.”

The quarterly study will become the pulse of market readiness and acceptance for self-driving and battery-electric vehicles, as seen through the eyes of consumers and industry experts. Sentiment is segmented into three categories: low (0-40), neutral (41-60) and positive (61-100). JD Power is joined by global survey software company SurveyMonkey to conduct the study in which 5,749 consumers were polled about self-driving vehicles and 5,270 about battery-electric vehicles.

Following are key findings about self-driving vehicles:

• Mobility Confidence Index is 36 for self-driving vehicles: With an overall score of 36, consumers have a low level of confidence about the future of self-driving vehicles. Scoring lowest among the self-driving attributes are: comfort about riding in a self-driving vehicle (34); and comfort about being on the road with others in a self-driving vehicle (35).
• Self-driving challenges: Industry experts say that perfecting self-driving technology is more challenging than originally thought. They also recognize the importance of marketing self-driving technology to consumers to build understanding, trust and acceptance, which is notably an industry-wide challenge.
• Disparate visions for availability: Experts anticipate self-driving services—public transit, delivery and taxi/ride-hailing—will arrive to market in 5-6 years while self-driving vehicles for purchase will arrive in about 12 years. Consumers predict each mobility option will be available in closer to 10 years. Most industry experts forecast it will be 15 or more years before self-driving vehicles have a retail market share of 10%.
• Tech failures, hacking and liability are top concerns: Although consumers are more hopeful than worried (65% vs. 34%) about the overall benefit of technology in their lives, 39% aren’t excited about any self-driving technology, including delivery services, public transit, taxi/ride-hailing service and personal vehicles. Serious concerns exist with the development of self-driving vehicles, of which consumers are most worried about tech failures/errors (71%); risk of vehicle being hacked (57%); and legal liability as a result of a collision (55%).
• Consumers still lack knowledge about self-driving vehicles: The majority (66%) of respondents admit to having little to no knowledge about self-driving vehicles. Gen Z¹ expresses the most knowledge, while Boomers express the least. Nearly three-fourths (71%) of consumers are more likely to purchase or lease a self-driving vehicle if they have a great deal of knowledge, but consideration dips to 25% for those who state they know nothing at all about them.
• Safety perceptions differ with age, knowledge: Overall, consumers are split on whether self-driving vehicles will improve traffic safety (40% better vs. 40% worse). Younger generations are more confident that safety will improve (52% of Gen Z, 45% of Gen Y), but 49% of Boomers think it will be worse than today. Consumers who say they know a great deal or a fair amount about self-driving vehicles believe such vehicles will improve traffic safety (59% and 52%, respectively).

Following are key findings about battery-electric vehicles:

•  Mobility Confidence Index is 55 for battery-electric vehicles: With an overall score of 55, consumers have a neutral level of confidence about the future of battery-electric vehicles. Attributes scoring lowest include likelihood of purchasing an electric vehicle (39); reliability of electric compared to gas-powered vehicles (49); and ability to stay within budget compared to gas, diesel or hybrid vehicles (55). Most consumers, regardless of age, believe there are positive environmental effects of electric vehicles.
•  Full speed ahead—for small market share: Both consumers and industry experts recognize it will be well over a decade before electric vehicles equal gas-powered vehicles in sales volume. Experts also predict it will be at least five years until battery-electric vehicles’ market share reaches 10%.
•  Challenges to increasing battery-electric vehicle acceptance: Consumer affordability and trust remain among the top challenges for electric vehicle adoption. In addition, infrastructure and battery concerns (cost, range and supply capacity) are critical challenges which must be addressed.
•  Advantages and disadvantages of battery-electric vehicles: More than half (61%) of respondents say battery-electric vehicles are better for the environment and 48% believe the cost of charging compared with the cost of gas will be advantageous. However, 64% are concerned about the availability of charging stations and 59% are concerned about range. More than three-fourths (77%) expect electric vehicles to have a driving range of 300 miles or more. Nearly three-fourths (74%) are only willing to wait 30 minutes or less to charge a vehicle to travel about 200 miles.
• Experience affects purchase consideration: Two-thirds (68%) of consumers say they have no experience with battery-electric vehicles, meaning they have never been in one. Among those who have owned or leased a battery-electric vehicle, 75% say they would consider repurchasing a similar vehicle. Among those who have never been in a battery-electric vehicle, only 40% said they would consider purchasing or leasing one. Universally, 78% say that tax subsidies or credits would factor into their purchase decision.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

SurveyMonkey (NASDAQ: SVMK) is a leading global survey software company on a mission to power the curious. The company’s People Powered Data platform empowers over 17 million active users to measure and understand feedback from employees, customers, website and app users, and the market. SurveyMonkey’s products, enterprise solutions and integrations enable organizations to solve daily challenges, from delivering better customer experiences to increasing employee retention. With SurveyMonkey, organizations around the world can transform feedback into business intelligence that drives growth and innovation.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]
Sandra Gharib, SurveyMonkey; [email protected]

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

 

One in 10 Americans Use Telehealth, But Nearly 75% Lack Awareness or Access, JD Power Finds

2019-07-29

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COSTA MESA, Calif.: 31 July 2019 — While 9.6% of Americans have used telehealth services, nearly three-fourths (74.3%) say they either don’t have access or are unaware of telehealth options, according to a JD Power pulse survey tracing telehealth user experience, hurdles to adoption and real-world patient concerns.

The initial survey, which is a supplement to the full 2019 JD Power Telehealth Satisfaction Study that will be published this fall, found that lack of access and awareness for telehealth options is the primary hurdle to adoption.

Key findings from the pulse survey include:

• Telehealth usage more likely among young, female patients: Patients age 18-to-24 have used telehealth more than any other age group (13.1%), with seniors (65+) maintaining the lowest utilization rate of any age group (5.3%). However, adults 35-44 show the second-highest level of engagement with telehealth, with 11.8% saying they have utilized telehealth services within the past year. Usage is considerably higher among females (10.4%) than among males (8.7%).
• Low levels of awareness and access hindering adoption: Overall, 39.7% of consumers say their health system or insurance provider does not offer telehealth services, while another 34.6% said they are unaware if any service is offered.
• Awareness lowest in rural areas: This lack of awareness is pronounced in rural areas (72%) where telehealth is supposed to increase access. Only 8.7% of rural residents have adopted the service, compared with 11.7% of suburban and 11% of urban residents.
• Quality of care is a concern: Nearly half (48.7%) of respondents believe the quality of care received in a telehealth session is lower than that of a doctor’s office visit, while only 6.2% perceive the quality to be higher, and 45.1% believe it to be the same. Another 43% also believe a telehealth session to be less personal than an office visit.
• West leads, northeast slow on adoption: Usage is highest among patients in the western region (11.1%), compared with just 5.7% in the Northeast.

“Telehealth technology is maturing, but the relatively low levels of engagement we’re seeing implies that major initiatives in both patient education and consumer experience are the next steps in making Telehealth a staple for healthcare delivery in the United States,” said Greg Truex, Managing Director of Health Intelligence at JD Power. “For patients that stand to gain the most from healthcare, telehealth needs be promoted as a way to reduce costs to both the healthcare system and consumers, all while maintaining a high level of care.”

Additional findings and the data set can be found at https://www.jdpower.com/business/resource/us-telehealth-study.

 

The 2019 JD Power Telehealth Satisfaction Study will be published Nov. 5, 2019. The study will measure patient satisfaction with telehealth providers in three categories—direct-to-consumer, payer-owned and health system-owned—and track the customer journey across five factors: awareness and selection; enrollment; consultation; billing and payment; and customer service. Objective benchmark performance metrics such as the JD Power Customer Satisfaction Index model and the Net Promoter Score¹ will be reported along with various behavioral metrics in the form of key performance indicators. Advocacy and loyalty measures will also be collected to help determine and forecast adoption rates across the United States.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

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

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¹Net Promoter,® Net Promoter System,® Net Promoter Score,® NPS,® and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc

 

Sales Slow, Discounts Rise—But Average Prices Break Records

2019-05-24

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The Retail Sales Forecast

New-vehicle retail sales in May are expected to fall from a year ago, according to a forecast developed jointly by JD Power and LMC Automotive. Retail sales are projected to reach 1,226,800 units, a 3.1% decrease compared with May 2018. The seasonally adjusted annualized rate (SAAR) for retail sales is expected to be 13.5 million units, down nearly 200,000 from a year ago.

May will be the fifth consecutive month in 2019 to experience a sales decline, with calendar year-to-date sales through May expected to be down 5.2% compared with the same period in 2018.

The Total Sales Forecast

Total sales in May are projected to reach 1,558,800 units, a 2.1% decrease compared with May 2018. The seasonally adjusted annualized rate (SAAR) for total sales is expected to be 17.0 million units, down 200,000 from a year ago.

The Takeaway

Thomas King, Senior Vice President of the Data and Analytics Division at JD Power:
“May is one of the highest volume months of the year and its performance typically indicates how the year will play out. The expected sales decline in May, coupled with weak sales year-to-date has left the industry with rising inventories of unsold vehicles. Manufacturers are responding with larger discounts to take advantage of the Memorial Day weekend which is one of the busiest car-buying periods of the year.” Last year, more than 238,000 vehicles were sold over the holiday weekend, accounting for more than 2% of full-year retail sales.

The number of new vehicles sitting on dealer lots is rising. On average, new vehicles sold in May spent 74 days on dealer lots, the highest level for the month of May since 2009 when the industry was dealing with the effects of the great recession. In fact, 29% of vehicles sold so far in May have sat on lots for 90 days or longer, up from just over a quarter of vehicles last year.

Manufacturers are responding with larger discounts. Incentive spending per unit so far in May is $3,722, up $25 from last year. While the increase is modest, it is notable for breaking a 10-month trend for the industry of lower year-over-year discounts. “Despite the increase in discounts, the industry continues to exhibit reasonable incentive discipline,” King said. “Spending as a percentage of MSRP remains below the 10% threshold at 9.1%.”

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Transaction prices are continuing to rise. New-vehicle prices in May are on pace to reach $33,457—the highest ever for the month—and are up more than 4% (+$1,345) from last year. The record prices reflect higher prices for both cars (up 3% to $27,259) and trucks/SUVs (up 4% to $36,388).

The growth in average prices is due primarily to sales weakness at lower price points. Retail sales of vehicles under $30,000 are expected to be down 5.7% in May, compared with 2.1% for the market overall.

Transaction price growth also means that the total value of new vehicles purchased in May will increase despite the sales decline. Consumers are expected to spend $41 billion on new vehicles this month, up $381 million from last year’s level. 

While new-vehicle demand is soft, the used market continues to be strong. Sales of used vehicles by franchised dealers are up 5.9% month-to-date over last year.  For many dealers, robust profits from used-vehicle operations are more than offsetting the challenges in new-vehicle operations.

“May reflects a mixed performance for the industry,” King said. “For manufacturers, despite lower volumes, higher prices are delivering an increase in net revenue. For dealers, strength in the used market is offsetting weakness in new. Looking forward, elevated inventory levels remain an issue that will only be corrected through production cuts or higher incentives. As the industry starts its transition to sales of 2020 model-year vehicles, pressure to increase discounts on 2019 model-year vehicles will rise considerably.”

Sales & SAAR Comparison

JD Power and LMC Automotive U.S. Sales and SAAR Comparisons

	May 20191	April 2019	May 2018
New-Vehicle Retail Sales	1,226,800 units (-3.1% lower than May 2018)2	1,029,034 nits	1,266,343 units
Total Vehicle Sales	1,558,800 units (-2.1% lower than May 2018)2	1,329,349 units	1,592,072 units
Retail SAAR	13.5 million units	13.1 million units	13.7 million units
Total SAAR	17.0 million units	16.4 million units	17.2 million units

¹Figures cited for May 2019 are forecasted based on the first 19 calendar days of the month.
²May 2019 has 26 selling days, the same as May 2018.

The Details

• The average new-vehicle retail transaction price to date in May is on pace to reach $33,457. The previous high for the month of May—$32,112—was set last year.
• Average incentive spending per unit to date in May is $3,722, up from $3,697 during the same period last year.
• Consumers are on pace to spend $41 billion on new vehicles in May, up $381 million from last year’s level.
• Truck/SUVs account for 70.8% of new-vehicle retail sales through May 19, the highest level ever for the month of May.
• Days to turn, the average number of days a new vehicle sits on a dealer lot before being sold to a retail customer, is 74 days through May 12, up 5 days from last year.
• Fleet sales are expected to total 332,000 units in May, up 1.9% from May 2018. Fleet volume is expected to account for 21% of total light-vehicle sales, up 0.8 percentage points from last year.

Outlook for the Year

Jeff Schuster, President, Americas Operations and Global Vehicle Forecasts, LMC Automotive
“While sales remain at historically high levels, pressures on the auto industry continue to mount. Chief among these is vehicle affordability concerns, which outweighs the strong economy and record-high consumer sentiment that otherwise should portend continued growth in U.S. auto sales. Despite these positives, some consumers have decided to either forego a new-vehicle purchase by remaining in their existing vehicle or else have shifted to the used-vehicle market.”

Even with a slight downward revision, LMC’s forecast for 2019 total light-vehicle sales remains at 16.9 million units, a decline of 2.5% from 2018. The retail light-vehicle sales are holding at 13.5 million units, a decline of 2.9% from 2018.

Media Relations Contacts
Geno Effler; JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
Emmie Littlejohn; LMC Automotive; Troy, Mich.; 248-817-2100; [email protected]

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

About LMC Automotive www.lmc-auto.com

 

As Airline Satisfaction Climbs to Record Highs, Line Blurs Between Low-Cost and Traditional Carriers, JD Power Finds

2019-05-28

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COSTA MESA, Calif.: 29 May 2019 — Is this the golden age of air travel? According to the JD Power 2019 North America Airline Satisfaction Study,^SM a combination of newer planes, better ticket value and improved customer touchpoints have driven overall satisfaction with airlines to its highest point in history, up 11 points (on a 1,000-point scale) from last year’s record-setting performance. The surge is driven by significant improvements among traditional carriers, while satisfaction slowed with low-cost carriers.

“Airlines continue to deliver on the operational side of air travel,” said Michael Taylor, Travel Intelligence Lead at JD Power. “New technology investments have dramatically improved the reservation and check-in process. Fleets are newer and travelers generally feel that they are getting great value for their money. These improvements have been most profound in the traditional carrier segment, where customer satisfaction has climbed considerably.

“While low-cost carriers have historically had the highest levels of customer satisfaction in our study, due to a strong sense of value for money among customers, that line is starting to blur as traditional carriers improve their services and operations,” Taylor added. “The one area where both traditional and low-cost carriers can still improve, however, is in in-flight services. It continues to be the lowest-ranked factor in the study, as many airlines still struggle with in-flight entertainment, connectivity, in-seat power and food service.”

Following are some of the key findings of the 2019 study:

• Record-high customer satisfaction: Overall satisfaction with airlines increases 11 points to 773, continuing an eight-year trend of satisfaction improvement.

• Improvement driven by traditional carriers: This year’s significant gains in customer satisfaction are driven by the traditional carriers, whose segment satisfaction score improves 22 points from 2018. The low-cost segment—while still having higher overall satisfaction than the traditional carrier segment—declines 6 points from 2018, thus driving a segment convergence in satisfaction.

• Tech investments in reservation and check-in systems pay off: The reservation and check-in experiences are the most satisfying portions of the airline experience, driven by investments in digital check-in technologies, self-service kiosks and a concerted effort among airlines to improve the efficiency of the pre-flight process.

• In-flight service remains a stumbling block: In-flight services, such as seatback entertainment, food service and Wi-Fi continue to be the lowest-ranked part of the air traveler experience. Specific in-flight amenities that have the greatest positive effect on customer satisfaction are fresh food, seatback games and seatback live television.

Study Rankings

Among traditional carriers, Alaska Airlines ranks highest for the 12th consecutive year, with a score of 801. Delta Air Lines (788) ranks second and American Airlines (764) ranks third.

Among low-cost carriers, JetBlue Airways (817) and Southwest Airlines (817) rank highest in a tie. For Southwest, this is the third consecutive year at the top of the JD Power ranking.

Among Canada-based airlines, Air Canada (729) saw its customer satisfaction score decline 5 points from 2018. WestJet (758) saw its score increase 11 points but remains below the low-cost carrier average.

The North America Airline Satisfaction Study, now in its 15^th year, measures passenger satisfaction with airline carriers in North America based on performance in seven factors (in order of importance): cost and fees; in-flight services; aircraft; boarding/deplaning/baggage; flight crew; check-in; and reservation. The study measures passenger satisfaction among both business and leisure travelers and is based on responses from 5,966 passengers who flew on a major North American airline between March 2018 and March 2019. The study was fielded from April 2018 through March 2019.

For more information about the North America Airline Satisfaction Study, visit https://www.jdpower.com/business/resource/jd-power-north-america-airline-satisfaction-study.

Join the conversation on social media using #AirlineStudy and follow JD Power on Facebook, Twitter and LinkedIn.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

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

 

 

JD Power Teams up with SurveyMonkey to Expand Reach into New Customer Segments

2019-05-30

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COSTA MESA, Calif.: 30 May 2019 — JD Power, the global leader in data analytics and consumer intelligence, has formed a partnership with SurveyMonkey (Nasdaq: SVMK), a leading global survey software company, to expand customer experience data collection through digital consumer channels. JD Power will leverage SurveyMonkey’s innovative digital platform and SurveyMonkey Audience, the company’s robust market research solution, to unlock insights from new customer segments.

“With an increasing amount of consumers’ lives being spent on digital platforms, it is critical that we, as the Voice of the Consumer, tap into the pulse of the marketplace right where it lives and breathes,” said Dave Habiger, CEO of JD Power. “By partnering with SurveyMonkey, we will be able to dramatically expand our consumer sampling capabilities.”

Initially, JD Power and SurveyMonkey will launch two comprehensive automotive studies using SurveyMonkey Audience, a global market research panel that provides access to over 50 million consumers in 100+ countries.  The first, a new JD Power ranking for the Aftermarket Service industry (ASI), will measure feedback from customers who service their vehicle with aftermarket general maintenance and tire retailers. The second, a new Mobility Confidence Index (MCI), will measure feedback from U.S. consumers regarding new mobility options, such as electric vehicles and self-driving technology.

“JD Power has been at the vanguard of customer experience analytics for more than 50 years, bringing deep expertise and data science to dozens of consumer markets,” said Jon Cohen, Chief Research Officer at SurveyMonkey. “We are excited to work with this amazing team to showcase how agile research delivers unmatched insights in the business-to-business space.”

JD Power is a global leader in consumer intelligence, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

SurveyMonkey is a leading global survey software company on a mission to power the curious. The company’s People Powered Data platform empowers over 17 million active users to measure and understand feedback from employees, customers, website and app users, and the market. SurveyMonkey’s products, enterprise solutions and integrations enable 350,000+ organizations to solve daily challenges, from delivering better customer experiences to increasing employee retention. With SurveyMonkey, organizations around the world can transform feedback into business intelligence that drives growth and innovation.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]
Sandra Gharib; SurveyMonkey; [email protected]

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

 

JD Power Helps Businesses Leap Over “Data Bar” With VIN Values

2019-06-04

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COSTA MESA, Calif.: 5 June 2019 — JD Power, the global leader in data analytics and consumer intelligence, today unveiled JD Power VIN Values, a unique product designed to significantly improve the vehicle valuation process and eliminate financial blind spots by using a Vehicle Identification Number (VIN) to precisely determine the correct trim level and factory-installed options.

JD Power leverages its multiple data assets and alliances to quickly gather trim, options and purchase history simply by inputting a 17-digit VIN.

The financial implications are significant. For example, a portfolio of 100,000 vehicles that uses a standard VIN decoding process could have a valuation margin error between 6% and 13%, resulting in an adjustment of $25-35 million. JD Power VIN Values product can eliminate this costly margin and provide users with an unmatched level of accuracy on any vehicle.

“The business of wholesaling and retailing vehicles demands transparency with speed and accuracy,” said Jonathan Banks, Vice President and General Manager of Vehicle Valuations at JD Power. “Access to trim and option data derived from a VIN meets these needs for virtually every step in the process of a vehicle being bought or sold.”

Benefits to Lenders

• Create loans for the exact amount for each vehicle portfolio or floorplan, and account for all the content of each specific vehicle.
• Consistently make more accurate loan-to-value decisions. Lenders will be able to ensure that a borrower is getting enough money to cover the purchase of the vehicle and related services.
• Improve the ability to set correct loan-to-value metrics; reduce the under- and over-valuing of vehicles; better comprehend the trim levels for high-margin vehicles.

Benefits to Dealers

• Create a specific strategy to know what option content is best suited for their region.
• Determine what vehicles to purchase at wholesale or auction through better integration with inventory optimization tools.
• Make decisions that more accurately reflect the vehicles in their inventory. Currently 30% of VINs that get decoded are unable to match to trim-specific data.
• API integration will enhance the accuracy and speed at which dealers can make critical decisions.
• Dealers can get option content on each individual vehicle and provide a trade-in value that’s in line with what the vehicle is actually worth.

Benefits to Insurers

• Further accuracy for insurers can result in more appropriate premiums for customers, while offering rates that are in line with vehicle values.
• Provides unparalleled insight into a vehicle’s content when evaluating total-loss scenarios.

Benefits to Rental Fleets

• Assess fleet inventory value and determine what individual models would be appropriate to wholesale. 
• Determine which options are most suitable to meet customer needs and expectations within regional markets.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts:
Geno Effler; JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

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

 

Auto Insurance Satisfaction Surges as Customers Adopt Direct-to-Consumer Models, JD Power Finds

2019-06-12

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COSTA MESA, Calif.: 13 June 2019 — The last decade of seemingly non-stop direct-to-consumer advertising and heavy investment into digital self-service technologies have driven roughly one-fourth of auto insurance customers to adopt direct distribution models that bypass agents in favor of do-it-yourself tools. According to the JD Power 2019 U.S. Auto Insurance Study,^SM that transition has helped overall customer satisfaction with auto insurance providers reach its highest level ever.

“Auto insurance customers have more access, control and visibility into the details of their policies, and that is translating into record high levels of customer satisfaction,” said Robert Lajdziak, Senior Consultant for Insurance Intelligence at JD Power. “As customers take greater control of their auto policies, it’s also becoming more important for insurers to offer superior digital experiences and easy access to account management features such as bill pay, policy information and an integrated experience for customers who bundle multiple policies.”

Following are some of the key findings of the 2019 study:

• Record-high satisfaction driven in part by direct service models: Overall customer satisfaction with U.S. auto insurers improves in 2019 and is now at a record-high level of 831 (on a 1,000-point scale). Within the total universe of auto insurance customers, the 23% of customers who use direct distribution models have the highest overall satisfaction.
• The more, the merrier: Satisfaction levels are significantly higher when auto insurance customers bundle their auto policy with additional policies, such as home and life insurance (837) than when they do not bundle (812). While, overall satisfaction scores, advocacy rates and likelihood-to-renew levels are all higher when customers bundle one or more insurance products with their auto policies, insurers have done a poor job at making the customer experience easier for bundlers.
• Average premium amount flat this year, which helps customer satisfaction: Customers say auto insurance premiums have leveled in 2019, following significant increases the previous two years. The tipping point is where customer satisfaction and retention start to become negatively affected by a price increase, is $100. The threshold for the likelihood to shop around at other insurance companies is lower, just $50.
• Attrition risk likely to rise: Price sensitivity peaked in 2010, shortly after the S&P 500 reached its lowest point following the Great Recession, when 87% of auto insurance said they would switch insurers for any amount of financial savings. In 2019, that number is 72%. With a possible market correction in sight, insurers will need to understand how to execute on the key performance indicators identified in the study that mitigate price sensitivity.
• A do-it-yourself attitude: Customers’ reliance on agents—feeling they are extremely important—has declined 33% over the past 20 years. Nearly one-fifth (17%) of customers with an agent say they have never met their agent in-person or over the phone.

“One of the reasons direct models are posting higher satisfaction scores is because the customer experience is centralized in the organization and therefore more consistently executed,” Lajdziak said.

Study Rankings

Following are the highest-ranked auto insurance brands by region:

California: Esurance
Central: Shelter
Florida: Allstate
Mid-Atlantic: Erie Insurance
New England: Amica Mutual
New York: New York Central Mutual
North Central: Westfield
Northwest: PEMCO Insurance
Southeast: Farm Bureau Insurance—Tennessee
Southwest: The Hartford
Texas: Texas Farm Bureau

The 2019 U.S. Auto Insurance Study, now in its 20^th year, examines customer satisfaction in five factors (in order of importance): interaction; policy offerings; price; billing process and policy information; and claims. The study is based on responses from 42,759 auto insurance customers and was fielded from February through April 2019.

For more information about the U.S. Auto Insurance Study, visit https://www.jdpower.com/business/resource/jd-power-us-auto-insurance-satisfaction-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

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

 

Medicare Advantage Plan Customer Satisfaction Steady as Cost Drives Plan Selection, JD Power Finds

2019-06-18

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COSTA MESA, Calif.: 20 June 2019 — With enrollment in Medicare Advantage plans nearly doubling over the past decade—now reaching roughly 20.4 million Americans—health plans have been able to maintain consistently high levels of overall customer satisfaction. According to the JD Power 2019 Medicare Advantage Study,^SM released today, overall satisfaction with Medicare Advantage plans has increased slightly this year.

“Approximately 10,000 people turn 65 every day in America and many are choosing Medicare Advantage plans helping private plan membership grow nearly 10% between 2018 and 2019,” said James Beem, Managing Director, Global Healthcare Intelligence at JD Power. “That’s 1.6 million beneficiaries being added to a relatively small number of health plans in a very short time frame. Even though health plans have been delivering a remarkably consistent customer experience, there is still room for improvement in the form of lowering costs for seniors, proactive communication around explanation of benefits and helping members coordinate healthcare.”

Following are some of the key findings of the 2019 study:

• Satisfaction gap narrows between PPO and HMO Plans: While overall customer satisfaction with Medicare Advantage plans is up 1 point (795 on a 1,000-point scale) from 2018, the gap in overall satisfaction between HMOs and PPOs is narrowing. In 2019, the gap is 10 points (804 for HMOs vs. 794 for PPOs), whereas in 2017, the gap was 20 points (810 for HMOs vs. 790 for PPOs).
   
• Member tenure has positive effect on satisfaction: Overall customer satisfaction is highest (822) among Medicare Advantage plan members who have been with the same plan between 9-11 years. However, 59% of plan members say they’ve been with their current provider for less than five years.
   
• Cost is most frequent driver of switching: Among Medicare Advantage plan members who choose to switch plans, the most common reason is cost-related. However, those who switch plans for cost-related reasons alone have satisfaction scores that are considerably lower (777) than those who switch for cost- and non-cost-related reasons (808).
   
• Information and communication offer opportunity for improvement: Aside from cost, the lowest-rated attributes in the study are consistently those related to information and communication. Fewer than 9% of Medicare Advantage plan members say they’ve experienced all three of the study’s key performance indicators related to effective communication.

Medicare Advantage Plan Customer Satisfaction Rankings

Kaiser Foundation Health Plan ranks highest in Medicare Advantage member satisfaction for a fifth consecutive year, with a score of 833. Kaiser outperforms all other plans across four of the six factors that comprise the overall satisfaction index. Highmark (818) ranks second and Humana (803) ranks third.

The study, now in its fifth year, measures member satisfaction with Medicare Advantage plans—also called Medicare Part C or Part D—based on six factors (in order of importance): coverage and benefits (29%); provider choice (17%); cost (15%); customer service (15%); information and communication (12%); and billing and payment (12%). 

The 2019 Medicare Advantage Study is based on the responses of 3,233 members of Medicare Advantage plans across the United States. It was fielded from January through March 2019.

For more information about the 2019 Medicare Advantage Study, visit https://www.jdpower.com/business/resource/us-medicare-advantage-study.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler, JD Power; Costa Mesa, Calif.; 714-621-6224; [email protected]
John Roderick; St. James, N.Y.; 631-584-2200; [email protected]

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

 

New-Vehicle Quality Stalls After Four Years of Improvement, JD Power Finds

2019-06-18

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COSTA MESA, Calif.: 19 June 2019 — New-vehicle quality in 2019 stays flat compared with 2018, marking the first year without improvement since 2014, according to the JD Power 2019 Initial Quality Study (IQS),^SM released today. More brands worsened than improved over the past 12 months.

“Automakers continue to make progress in areas like infotainment that attract a lot of consumer attention,” said Dave Sargent, Vice President of Global Automotive at JD Power. “However, some traditional problems crept up this year including paint imperfections, brake and suspension noises, engines not starting and the ‘check engine’ light coming on early in the ownership experience. Also, more people are having issues with their advanced driver assistance systems, which are critical for building consumer trust in future automated vehicles.”

Initial quality is measured by the number of problems experienced per 100 vehicles (PP100) during the first 90 days of ownership, with a lower score reflecting higher quality. In this year’s study, only 13 brands improved, while 18 worsened. The industry average remained unchanged at 93 PP100.

Following are key findings of the 2019 study:

• Gap between Korean brands and others continues to widen: The three highest-ranking brands—Genesis, Kia and Hyundai—are all from Korean manufacturer Hyundai Motor Group, and the gap between these three brands and all others has widened considerably. Remarkably, 16 of 18 models from Hyundai Motor Group rank in the top three in their respective segments. These vehicles tend to perform especially well in the areas of infotainment and other electronic components.
• Domestic brands above average: Ford (83 PP100), Lincoln (84 PP100), Chevrolet (85 PP100), Dodge (90 PP100) and Buick (92 PP100) all perform better than the industry average of 93 PP100. Overall, Domestic-branded vehicles perform close to the average in most areas.
• All European brands are below average: In contrast to the success of the Korean automakers and the leading domestic and Japanese brands, all 10 European marques are below average. The largest gaps for the European vehicles are infotainment and other electronics.
• Porsche 911 again achieves the best score of any model: The Porsche 911, with just 58 PP100, has the best score of any model for the second consecutive year.
• Infotainment problems are decreasing: Infotainment remains the most problematic category for new-vehicle owners. However, this area is the most improved from 2018, led by fewer problems for voice recognition and Bluetooth.
• Problems with driver assistance systems are increasing: As advanced driver assistance systems become more widespread and increasingly complex, more owners are indicating problems. The average for premium brands is 6.1 PP100, up from 5.0 last year, while the average for mass market brands is 3.5 PP100.
• New and redesigned vehicles still trail carryover vehicles: Vehicles that were launched in 2019 have an average problem level of 103 PP100, which equals the best score ever. However, this is still well below the score for carryover models, which have an average problem level of 91 PP100.

Highest-Ranking Brands and Models

Genesis ranks highest in overall initial quality with a score of just 63 PP100. Kia (70 PP100) places second and Hyundai (71 PP100) ranks third. This is the second year in a row that the three Korean brands are at the top of the overall ranking, and it is the fifth consecutive year that Kia is the highest-ranked mass market brand. Ford (83 PP100) ranks fourth and Lincoln (84 PP100) ranks fifth, marking the first time both Ford Motor Company brands place in the top five in the same year.

Land Rover is the most-improved brand, with owners reporting 37 PP100 fewer problems than in 2018. Other brands with strong improvements include Jaguar (18 PP100 improvement), and Dodge and Volvo (each with 8 PP100 improvement). This is the highest Dodge has ever ranked in the study.

The parent corporation receiving the most model-level awards is Hyundai Motor Group (six awards), followed by General Motors Company (five);BMW AG (three); Ford Motor Company (two) and Nissan Motor Co. Ltd. (two).

• Hyundai Motor Group models that rank highest in their respective segments are Genesis G70; Hyundai Santa Fe; Kia Forte; Kia Rio; Kia Sedona; and Kia Sportage.
• General Motors Company models that rank highest in their segments are Cadillac Escalade; Chevrolet Equinox; Chevrolet Malibu; Chevrolet Silverado HD; and Chevrolet Tahoe.
• BMW AG models that rank highest in their segments are BMW 2 Series; BMW X4; and MINI Cooper.
• Ford Motor Company models that rank highest in their segments are Ford Fusion and Ford Ranger.
• Nissan Motor Co. Ltd.models that rank highest in their segments are Nissan Maxima and Nissan Titan.

Other models that rank highest in their respective segments are Dodge Challenger, Lexus RX and Mercedes-Benz CLS.

Plant Quality Awards

Toyota Motor Corp.’s Cambridge North (Canada) plant, which produced the Toyota Corolla, receives the Platinum Plant Quality Award for producing vehicles with the fewest defects or malfunctions. Plant quality awards are based solely on defects and malfunctions, and exclude design-related problems.

Toyota Motor Corp.’s Tsutsumi 1 (Japan) plant, which produces the Toyota Prius and BMW AG’s Regensburg (Germany) plant, which produces the BMW 4 Series, X1 and X2, each receive the Gold Plant Quality Award for the Asia Pacific and Europe/Africa regions, respectively.

The 2019 U.S. Initial Quality Study is based on responses from 76,256 purchasers and lessees of new 2019 model-year vehicles who were surveyed after 90 days of ownership. The study is based on a 233-question battery organized into eight vehicle categories designed to provide manufacturers with information to facilitate the identification of problems and drive product improvement. The study was fielded from February through May 2019.

Find detailed information on vehicle quality, as well as model photos and specs, at jdpower.com/quality.

For more information about the U.S. Initial Quality Study, visit http://www.jdpower.com/resource/us-initial-quality-study-iqs.

JD Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable JD Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, JD Power has offices serving North America, South America, Asia Pacific and Europe.

Media Relations Contacts
Geno Effler; Costa Mesa, Calif.; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

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