J.D. Power and Associates has released its annual Customer Retention Study, and Hyundai ranks the highest among brands in retaining buyers. Hyundai's retention rate is up four percentage points to 64 percent in 2012, thanks largely to the Elantra and Sonata models. J.D. Power says that much of the manufacturer's retention rate can be traced to its growing vehicle offerings and positively changing perceptions about Hyundai quality and market appeal.

Ford and Honda tied for second place with a rate of 60 percent. The report notes that Jeep enjoyed the largest improvement over the previous year with a jump of 17 percentage points to 51 percent in 2012.

The study also evaluated which buyers were more likely to return to an automaker for their next purchase, and the data revealed women and younger buyers had a higher brand retention rate than older consumers and males. Honda, Hyundai, Kia and Mercedes-Benz were all found to be particularly adept at keeping their female customers, while Ford, Kia, Lexus and Mercedes-Benz did a better job of holding onto buyers from Gen X and Y. Hit the jump for the full results of the 2012 Customer Retention Study.
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J.D. Power and Associates Reports: A Desire for Different Vehicle Attributes and Features Leads Many New-Vehicle Owners to Switch Brands

Hyundai Ranks Highest in Customer Retention among 33 Automotive Brands

WESTLAKE VILLAGE, Calif., Jan. 11, 2012 /PRNewswire via COMTEX/ -- One in three new-vehicle owners who switched brands say their previous brand didn't make the type of vehicle they wanted, indicating that striking the right combination of model offerings and vehicle appeal is critical to retaining customers, according to the J.D. Power and Associates 2012 Customer Retention Study(SM) released today.

Now in its ninth year, the study measures the rate at which automotive brands retain their existing customers and examines the reasons why customers remain loyal. Customer retention is critical to a brand's market success, particularly during the current period of market recovery, in which each new-vehicle sale is vital. In addition to customer retention, the study also measures the rate at which each automotive brand captures customers from its competitors, known as conquesting.

Among new-vehicle owners who switched vehicle brands for their latest purchase, 33 percent indicate that their previous brand didn't offer the type of vehicle they wanted. Although this is a primary reason for switching, other key reasons relate to dissatisfaction with the previous vehicle, including the vehicle costs too much to own or maintain; there are too many problems with the vehicle; and the vehicle didn't retain sufficient resale value.

"Many automotive brands are expanding their array of models in an attempt to capture more buyers, but this isn't enough in and of itself," said Raffi Festekjian, director of automotive product research at J.D. Power and Associates. "Manufacturers need to integrate specific attributes and features that delight vehicle owners to maximize their opportunity to both retain customers and conquest from other brands. Manufacturers also need to ensure owners are satisfied with the quality, residual values and ownership costs of their vehicles."

According to Festekjian, brands that strike the right combination of all of these aspects stand the best chance of being reconsidered by current vehicle owners for their next new-vehicle purchase.

Hyundai ranks highest among automotive brands in retaining customers when they buy a new vehicle, and improves its retention rate by four percentage points from 2010(1) to 64 percent in 2012. Hyundai's retention rate is primarily driven by the Elantra and Sonata models.

"Hyundai's increased retention rate is shaped by its expanding model lineup, as well as the fact that perceptions of the brand's quality and appeal have continued to improve during the past decade," said Festekjian.

Following Hyundai in the rankings are Ford and Honda, in a tie, each with a customer retention rate of 60 percent. Jeep posts the greatest improvement in customer retention rate from 2010, improving by 17 percentage points to 51 percent in 2012.

Overall customer retention has improved by one percentage point in 2012 to 49 percent, compared with 48 percent in 2010. In 2012, 19 of the 33 ranked brands have improved their customer retention rates from 2010, while 14 have declined.

The study also finds that women and younger vehicle owners (those in the Generation Y and Generation X demographics, between ages 23 and 47) are less likely to choose the same vehicle brand for their next purchase, compared with men and older owners.

"Women and younger vehicle owners are more likely to experience changes in their life circumstances, including growth in household size or changes in income levels, that would lead them to purchase vehicles that better accommodate their new lifestyle," said Festekjian.

Brands that perform particularly well in retaining women customers include Honda, Hyundai, Kia and Mercedes-Benz. Among vehicle owners in the Generation Y and Generation X demographics, Ford, Kia, Lexus and Mercedes-Benz perform particularly well in customer retention.

The 2012 Customer Retention Study is based on responses from 117,001 new-vehicle buyers and lessees, of which 73,733 replaced a vehicle that was previously acquired new. The study was fielded between February and May 2011 and August and September 2011.

(1) J.D. Power and Associates last issued the Customer Retention Study in December 2010. Comparisons between the 2010 and 2012 studies span a one-year period, rather than a two-year period. The study was not published in 2011.

2012 Brand Retention Rates
Hyundai 64%
Ford 60%
Honda 60%
BMW 59%
Kia 59%
Toyota 58%
Chevrolet 57%
Mercedes-Benz 57%
Lexus 54%
Cadillac 52%
Jeep 51%
Nissan 50%
MINI 49%
Ram 49%
Industry Average 49%
Subaru 48%
Land Rover 47%
Volkswagen 47%
GMC 46%
Infiniti 46%
Acura 45%
Audi 45%
Porsche 42%
Lincoln 40%
Buick 38%
Mazda 34%
Mitsubishi 33%
Jaguar 31%
Volvo 30%
Chrysler 26%
Scion 24%
Dodge 21%
Suzuki 20%

Base: Vehicle owners who previously purchased a new vehicle of a particular brand.
NOTE: smart is included in the study, but not ranked due to small sample size.

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    • 1 Second Ago
      • 3 Years Ago
      I've 2 Nissan 4 banger 4WD pickups, '88 and '98. As I told theNissan salesman, they've only got one thing wrong with 'em. They won't die! Both are over 220,000 miles and the '98, on long trips, average MPG is 23.2 But . . . I would like to replace the '88 with a Subaru Outback. Better mileage, AWD, higher passenger capacity and better crash safety gear.
      MIchigan Man
      • 3 Years Ago
      The last American car I owned was a 1976 Chevy Nova. Have owned NIssans, Hondas, and Toyotas and no problems with any. Ford appears to be the only American manufacturer who has observed and listened to what Amerians want and it appear to have been a plus for them. Always been a GM person, but the only American automobile I would buy now is Ford.
      • 3 Years Ago
      Hey, look at that--build good stuff, people come back.
      • 3 Years Ago
      This just proves, as suspected, old people buy Hyundai's.
      • 3 Years Ago
      A major factor in Hyundai retention is Hyundai's guaranteed trade in value. They give you more for your trade than a reputable dealer would, but stick it to you on the new one.
        • 3 Years Ago
        I didn't get that with my genesis, and you can still bet I'm looking at Hyundai for my next vehicle...not because of a trade in value down the line...but because it's a great vehicle.
      Smooth Motor
      • 3 Years Ago
      Seriously how is Suzuki still in business in the US? They are constantly at the bottom of every rating/survey.
        • 3 Years Ago
        @Smooth Motor
        • 3 Years Ago
        @Smooth Motor
        How is Chrysler still in business?
          • 3 Years Ago
          • 3 Years Ago
          By building better cars than GM.
        • 3 Years Ago
        @Smooth Motor
        They sell quite a few SX4s in the Northeast where they have dealers. Efficient, cheap, reliable, and most importantly, AWD. My brother has a loaded one, and that thing goes like snow isn't there. And mush less than 18g's.
      Robert Fahey
      • 3 Years Ago
      The Hyundai/Kia documentary should be called, "From Zero to Hero in a Decade."
      • 3 Years Ago
      Three cheers for Hyundai. I remember when they first hit the market, almost all the mavens of the industry were in thier glory poo-pooing such a poorly designed and made car. Ho hum to those arrogant SOB's who were forever telling us to be good American's and buy American. Gee, how did that work out for them. The unions have killed the auto industry, and almost every other manufacturing job in the U S. Remember that old union propoganda ditty, "LOOK FOR THE UNION LABLE", back when the clothing manufacturers were beginning to move off shore, another bull-poop attempt by the unions to sell us on the need for these vultures to be allowed to exist. Well it did not work. Now we have the government employee unioms to contend with and here is the greatest boon-doggle yet to hit AMERICA. We are going to have a pretty substancial number of states and cities go broke this year due to insufficient funding for thier pension funds. Oh my GOD, WAIT TILL THAT HAPPENS, THERE WILL BE RIOTS IN THE STREETS, AND THE COPS AND FIREMEN WILL BE ON THE PICKET LINE. This crap has to end, the politicians have spent tax-payer money for the last fifty years buying the union vote and now they will want us to pay up even more. Screw them and the horse they all came in on.
      • 3 Years Ago
      Little by little, Toyota and Honda will slide down. It's already started.
        • 3 Years Ago
      • 3 Years Ago
        • 3 Years Ago
        I think it was 6or7 years ago, Chung was quoted as saying his philosophy was "quality, quality, quality" and Hyundai's quality has definitely turned around from the 90's Pony/Excel that wouldn't start on rainy days. His revised out look now includes brand image, which has lead to the current slew of awesomely equipped, forward thinking cars. Just the idea that higher end features which cost pennies to include in lower end vehicles are being offered for great prices points doesn't mean cheap, it means that the B.S. of high margin features is being torn down. I've been able to buy a GPS nav unit for $99 for YEARS, why the hell doesn't every North American can not already have these integrated on every model?!?! If we did, think about the value any advancements cities could offer consumers by posting accurate and timely traffic and construction information? Clinging to high margins on these value add features means that stuff doesn't get standardized and the value of owning it is even less attractive. Right now I look at all the other players as the cable companies of the auto industry. Maybe with Ford as an exception. They really shown some forward thinking in the last 4 years and it's starting to really show.
          • 3 Years Ago
          I now even think $99 for a GPS is too much after being spoiled by Waze, which is a complete free GPS app with voice-guidance on smartphones. It can even shows where cops are.
      • 3 Years Ago
      I've been a longtime Honda fan, but never again. My first 2 ran great (one was 12 years old when I sold it), never a problem with either. My Accord just went out of warranty this year and needed 6K in repairs. New transmission, brake/fuel lines, cat/O2 sensor, hvac system. suspension, airbag light is on. Hell, the clock doesn't even work. Plus all their "new" cars are nothing more than cheapened versions of the ones they are replacing.
        • 3 Years Ago
        One other minor problem with honda...They don't honor their warrenties!
      • 3 Years Ago
      I love My Mercerdes, and have driven them since I was a kid. We still have a '63, a '70, a '73, a '77 and an '84. We do have 2 of the new ones....but there is such a pure sense of DRVING the oldsters. No Ipods, Bluetooth or all the other electronic crap...just driving a solidly built, beautiful car. Some we have are over 300K on the odo and run beautifully. I wouldnt drive a Hyundai or Kia at gunpoint.
        • 3 Years Ago
        Tammy,Ive got a 77 300d I just restored,its really cool and red.I want a MB 68 250 se
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