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Quality as key to auto sales

Researcher urges less focus on deals

DETROIT -- A survey of vehicle owners released today suggests that while this summer's employee discounts may give automakers short-term sales gains, improving quality is more important in the long run.

Toyota Motor Corp. got the top score, 87 out of 100, in the University of Michigan's American Customer Satisfaction Index. Owners were asked about their overall satisfaction and their satisfaction level versus expectations. They also were asked to rate how their vehicles compare to their ideal vehicles.

Honda Motor Co., BMW AG, and General Motors Corp.'s Cadillac and Buick brands rounded out the top five. Ford Motor Co.'s Ford brand got the lowest score, 75.

Half of the brands improved their scores from last year, including Hyundai Motor Co. and GM's Pontiac brand. One-quarter stayed the same, while one-quarter saw their scores drop, including Nissan Motor Co. and Ford's Lincoln and Mercury brands.

University of Michigan professor Claes Fornell, who compiles the index, said Hyundai's rapid climb shows that focusing on quality can significantly improve satisfaction ratings. Hyundai was at the bottom of the index with a record low score of 68 in 1999, Fornell said. Quality and styling improvements and the introduction of the industry's first 10-year, 10,000-mile warranty catapulted Hyundai to number six this year.

''That's something to hold up for Detroit, that this can be done. It's possible," Fornell said. ''You don't have to give away cars."

Fornell said the Big Three US automakers should spend less on incentives and more on quality improvements. US automakers spent an average of $4,239 per vehicle on incentives in July, compared to $2,372 for European brands and $1,619 for Asian brands, according to Autodata Corp.

''It's a dangerous path that the domestic industry is on," he said.

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