Making Sense Of The J.D. Power Rankings

When J.D. Power and Associates released its influential Initial Quality Study findings on June 17, there were two screaming headlines: Detroit topped the Asians in the rankings for the first time in the study's 24-year history. The other headline was that Toyota, as a brand, fell to below industry average on quality. If consumers don't look beyond the headlines and the water-cooler chat, though, they are doing a disservice to themselves as they try to make sense of the IQS study, which can be a valuable tool for consumers.

First of all, you have to understand what the study measures, which is "things-gone-wrong" and "things-that-are-right" in the first three months of ownership. While the rankings of the brands are an indicator of how well, or how poorly a company's lineup is doing, it isn't necessarily the best measure to look at when selecting a new car. For that, it's much more useful to look at the list Power provides of the top-three vehicles in each product segment.

Has Toyota Really Slipped?

?Consider Toyota. The company fell from sixth best brand last year to 21st this year, with owners reporting 121 problems per 100 cars, versus 101 last year. The top complaints on Toyotas were floor mats and brakes, the two principle culprits that have led to Toyota recalling over eight million vehicles in recent months. Another factor is that there has been so much negative publicity around Toyota and its handling of the recalls that it is hard to imagine that owners filling out surveys weren't grading a bit harder than last year. The hassle of the recalls also puts owners in a bad mood.

??But even with the bad report card for Toyota, there are still models at Toyota showrooms that ranked high and even led their categories. The Toyota Yaris was the second highest ranked car among subcompacts, just behind the Hyundai Accent and ahead of the Honda Fit. The FJ Cruiser, which hasn't sold well and is being phased out, was top-ranked in its category, outscoring the much better selling Honda CR-V and Honda Element. The Toyota Sienna was the top ranked minivan. Toyota's Scion xB also led its category.

??Among luxury brands, Toyota' Lexus brand was still highly ranked, as it is every year, with several of its models leading their categories: The Lexus LS sedan, GS sedan and GX SUV topped their segments. (It's worth noting that after the survey was completed, Toyota recalled the GX and suspended sales in order to fix a stability control system.)??

"This is a critical time for Toyota because they can make this fall in the Power rankings temporary, or they can watch it become permanent based on how serious they are about fixing the things that have led to these recalls," said Los Angeles-based marketing consultant Dennis Keene. "The tricky thing in the auto industry, though, is that if there are fundamental things wrong with the design or quality of materials, it can take a long time to fix, and even longer for people to notice it and then have it show up in the media or on surveys."?

Can Ford Make Its Improvement Stick?

Then there is Ford, which led all mass-market brands for quality this year. Ford has made improvements to its cars and trucks across the board, and its overall quality rankings have been steadily creeping up over the past five years. But it is also worth noting that when you examine the rankings product-by-product, Ford actually led far fewer categories than Toyota. Only the Ford Focus and Ford Taurus led their segments, and the Focus is about to be replaced in a few months by a new Focus that has no connection to the current one. The Ford Fusion placed second to the Honda Accord and the Ford F-Series placed only third among pickup trucks. The Ford Edge placed third in its category behind the Honda Crosstour and Honda Pilot.

??Another point to consider is that at the time the survey was conducted, Volvo was still part of Ford. Between the two brands, Ford had 12 models place in the top three across the 20 segments ranked by Power.??

The other key factor to keep in mind when looking at Power rankings is that few, and often minor, problems can separate brands and models within the categories. Consider, for example, that Ford, as a brand, had 93 problems reported per 100 vehicles, compared with Lexus, which had 88. That's five problems per 100 vehicles that separate Ford from Lexus. Pretty small potatoes.?

What About The Rest?

?The problems of Toyota and surge of Ford left General Motors and Chrysler a bit in the background in the latest study. GM brands lost ground last year after having launched several new vehicles. J.D. Power's Dave Sargent said it is common for a company to lose ground when they launch a large number of vehicles in the previous year.

??Sargent says GM can easily turn the rankings around by making swift fixes to some problem vehicles like the new Cadillac SRX and Chevy Camaro. The SRX's engine required fixing after just a few months on the market, and the interior quality of the Camaro cost it points with buyers.??

But, as with the examples of Toyota and Ford, it pays to look at the individual category rankings. GM dominates the quality rankings of large SUVs, with its Tahoe, Suburban and Yukon sweeping all three. The Chevy Avalanche and GMC Sierra are the two ranked pickups. Even the Chevy Malibu narrowly trailed the Honda Accord and Ford Fusion in the very important mid-sized sedan category.??

Whoever said you can find truth in numbers was on to something. But you need to know where to look for the right numbers.