JD Power: Consumers Turn to Non-Dealer Service after Warranty
4 May 1998
Consumers Turn to Non-Dealer Service Providers After Vehicle Warranty Period
AGOURA HILLS, Calif., May 4 -- Many consumers defect to non-
dealer service providers when their vehicle warranty expires according to the
J.D. Power and Associates 1998 Service Usage & Retention Study(SM) (SURS)
published today. The study contrasts the new-vehicle service habits of
customers whose warranties have expired, to the habits of the same group when
their vehicles were covered by the warranty.
"Most dealerships see their customers less and less after the warranty
ends," commented Joe Ivers, director of customer service research at J.D.
Power and Associates. "Customers increasingly go to aftermarket providers,
such as specialty oil change shops and full-service facilities, such as you
find at WalMart or PepBoys. While dealerships do still see the majority of
their customers at least once during the year, many of those customers have
maintenance and light repair work done at sources other than the dealership,"
Mr. Ivers said.
The study reveals that about 46% of customer expenditures for service goes
to non-dealer service providers, and about half of the defection from
dealerships is attributable to customer dissatisfaction with dealership
service during the warranty period. When the warranty no longer holds them
captive, some customers stay and some leave. According to the study, two
strong contributors to this lost business are unreasonable amounts of time
taken to service the vehicle, and the need to return to the dealership because
of unsatisfactory work.
Most customers who use non-dealer service providers cite convenience,
location and the amount of time it takes to get the work done. Other
important influences are a good past experience and a competitive price. The
study shows that price is not the primary driver for many customers, though
57% of customers using non-dealers cited price as a reason, compared to only
18% of dealership customers.
Non-dealer service providers, on average, show much greater customer
satisfaction levels than dealerships, even though the highest satisfaction
levels come from certain excellent groups of dealerships. The highest
satisfaction is seen among customers of Lexus dealers, followed by Infiniti,
and then by independent service facilities. The only dealer franchises
showing improved service satisfaction over last year were Ford, Saab, Cadillac
and Eagle.
When it comes to retaining its service customers, the industry leader is
Cadillac, with 98% of its customers obtaining some service at the dealer over
the past year. Cadillac is followed closely by Land Rover and Jaguar in
service customer retention.
J.D. Power and Associates is an international firm best known for its
marketing information services in key business sectors including market
research, forecasting and customer satisfaction. The firm's quality and
satisfaction measurements are based on actual customer responses from over one
million consumers annually. With its headquarters in Agoura Hills,
California, the firm also has U.S. offices in Torrance, California; Michigan;
and Connecticut. Its international locations include Japan, Korea, England,
Canada and Brazil. J.D. Power and Associates can be accessed through the
World Wide Web at http://www.jdpower.com. Media email contact:
john.pepitone@jdpower.com.
This press release is provided for editorial use only. No advertising or
other promotional use can be made of the information in this release or J.D.
Power and Associates survey results without the express prior written consent
of J.D. Power and Associates.
J.D. Power and Associates 1998 Service Usage & Retention Study(SM)
Top Ten Providers in The Service Satisfaction Index
Lexus 132
Infiniti 123
Indep. Svc. Facilities 118
Saturn 116
Cadillac 114
Texaco 109
Lincoln 105
Mobil 105
Volvo 105
Acura 101
Industry Average = 92
(1997 = 100)
J.D. Power and Associates 1998
Service Usage & Retention Study(SM)
Top Ten Manufacturers in Dealership Service Usage
Cadillac 99%
Jaguar* 98%
Land Rover* 95%
Mercedes-Benz 94%
BMW 94%
Lexus 93%
Lincoln 93%
Infiniti 92%
Audi 89%
*Small Sample Dealership Average 75%
Note: All data is based on the service facility used, not vehicle owned.
Source: (c)J.D. Power and Associates
1998 Service Usage & Retention Study(SM)
Charts and graphs extracted from this press release must be accompanied by
a statement identifying J.D. Power and Associates as the publisher, and the
J.D. Power and Associates 1998 Service Usage & Retention Study(SM) as the
source. No advertising or other promotional use can be made of the
information in this release or J.D. Power and Associates survey results
without the express prior written consent of J.D. Power and Associates.
SOURCE J.D. Power and Associates