Dear Colleagues,
Yesterday, Consumer Reports announced results from its 2008 Annual Auto Reliability Survey. Subscribers to Consumer Reports are surveyed each year about the vehicles in their households. Predicted reliability for new models is based on the previous three model years for the same model.
This year Chrysler LLC vehicles trailed the industry average and dropped in ranking when compared with last year’s study. The decline in our ratings is based on the results for 2008 model year vehicles that were built about one year ago.
Based on our aggressive focus on warranty claim rate reduction, we know that the cars we are building today have a much higher standard of overall quality. Having said that, due to the three-year window, Consumer Reports ratings are slow to change.
The results tell us a few important things about our approach to quality over the last few years:
* Our overall reliability is below industry average.
* We do have some vehicles that scored above average for reliability.
* We have a corporate-wide commitment to quality that is well on its way and essential to get Chrysler back on the path to sustainability and profitability.
Summary of Results
Predicted reliability is Consumer Reports’ forecast of how well models currently on sale are likely to perform. The Chrysler brand is ranked 32 out of 34 brands and dropped 13 positions compared with the 2007 rankings. Dodge ranked 30 out of 34 and dropped five positions. Jeep ranked 28 out of 34, which is the same as last year.
There were a couple of highlights in the Chrysler results. The Dodge Caliber and Jeep Patriot were ranked above industry average and were considered the best models of the company’s brands.
Clearly, we are not satisfied with our overall results and continue to work aggressively in new ways to improve every aspect of customer satisfaction as we are committed to deliver products that meet consumers’ needs. Since the vehicles in this survey were built, a tremendous amount has been accomplished. We have formed 18 new, cross-functional teams to correct quality problems by vehicle system. Our Customer Satisfaction Teams (CST) are comprised of more than 250 people who have helped reduce quality issues since January. We are continuously measuring our progress and improving the way we work to accelerate our improvement.
In addition to the CSTs, the development processes and testing procedures put into place nearly five years ago have helped with the high-quality launch of the 2009 Dodge Ram. For example, before the 2009 Dodge Ram went on sale, nearly 6.5 million customer-equivalent miles were logged by Dodge truck engineers. The 2009 Ram went through more than 200 hours of wind noise and aerodynamic evaluations, and engineers conducted approximately 40,000 hours of full-scale vehicle and system testing for durability and reliability of the vehicle.
While we expect our company-wide quality initiatives to be successful, we will continue our focus on the needs of our current customers and the priorities of those consumers who are considering future vehicle purchases. Thank you for your hard work and dedication to quality improvement. With all of us having the same focus of “Customer First” and “Quality … Period,” we will continue to accelerate our commitment to quality and strive to meet the needs of our customers.
Sincerely,
Doug Betts
Vice President and Chief Customer Officer
[thanks to you know who you are]
Isn’t that a WordPerfect template; from about 1980, don’t you just edit the names and titles?
Chrysler may no longer exist before long, but I would give them a better chance of improving reliability now compared to the time when owned by Daimler.
If Ford can make very reliable cars than anyone can.
You have to give them credit for acknowledging the problems instead of simply throwing mud at CR. Now whether or not the “aggressive focus on warranty claim rate reduction” means they are actually fixing problems or not is a question. Sometimes warranty claim reductions are achieved by making the poor suckers who got stuck with problems suffer.
The Chrysler brand is ranked 32 out of 34 brands and dropped 13 positions compared with the 2007 rankings.
More of a question than anything…
Even if CRs methodology is wrong, they apply the same methodology to all the manufacturers. So if Chrysler falls precipitously in the rankings it is a sign of a real problem? Your thoughts?
OMG.
I was on a team to improve VeeDub’s (Germany) J.D.Power CSI when it was in the basement a few years ago. Some may remember the days when VW vas down & nearly out in the U.S. also. My heart goes out to Chrysler: Tough job. Real improvement takes many years and a lot of money. They have neither.
I could teach them some tricks on how to goose ratings without touching the car itself, but it would have to be cash upfront ….
Good point re: Ford, Davey. When I drove an Expedition, I always gave my dealer’s shop the best marks, because I never had seen it from the inside.
I have a 2006 Chrysler PT Cruiser GT, and never once have I had a single solitary problem with this vehicle. I have just over 40k miles on the odometer. I have sold Chryslers in the past and currently sell Acuras, I honestly have more complaints about the Acuras then I ever did from my Chrysler customers. I have been very surprised.
daro31: You’re exactly right, and not just for Chrysler.
However, I must say that although my several Chrysler ownership experiences have been mixed in terms of quality, my only Honda was a lemon.
For CR’s part, though, they never saw a Japanese car they didn’t like. I wouldn’t call them “fair and balanced”.
I knew some of those people. They took their work very seriously. They tried to make quantitative and qualitative improvements on a continual basis, but the tide was against them. Now there’s 5,000 less of them.
A 2006 Business Week article revealed GM increased some key durability specifications from 80,000-miles to over 100,000-miles. Good to know excluding quality lapses GMs will last until the first recommended tune-up!
It would be interesting to know other automakers’ durability specifications.
TrueDelta doesn’t yet have results for many Chrysler vehicles. The people who tend to participate in our research are those who care about reliability, and people who care about reliability and look at the existing information on Chryslers don’t buy Chryslers.
That said, the results we do have have led me to wonder if Chrysler’s quality has declined in the past year. With the Jeep Compass and Patriot and the Dodge Caliber our limited data suggest that the 2008s have more problems than the 2007s did.
What this might mean: that even these bright spots in CR’s ratings would be less bright if their ratings weren’t so slow to react.
Conversely, if Chrysler does manage to improve its vehicles quality, this will show up in TrueDelta’s results first. They can start with the minivans:
http://www.truedelta.com/latest_results.php
Michael Karesh:
Very interesting. You’ve put your finger on the core metric for customer satisfaction: Workshop visits. In my former work we found a direct correlation between the number of workshop visits and satisfaction. After 4 visits, customers usually walked away from the brand. Kinda obvious, but it felt like preaching celibacy to drunken sailors. The number of visits in your data strike me as low. We tracked actual visits, and found 3 -5 per year for new models that had problems. And what makes a “successful” visit? The problematic ones are the unsuccessful visits, when the poor dealer doesn’t even know how to fix the damn thing. Not because he’s stupid. Because the factory is still scratching their heads, or because the failing part hasn’t been made yet.
Unsuccessful visit = new visit from a grumpier and grumpier customer.
Workshop visits = warranty costs = a huge drain on profitability. A monster. No wonder that Toyota, the company with the highest CSI, is also financially in good shape. Happy customers, low warranty costs.
In the 1950s and 1960s new car warranties were 90-days or 4,000-miles. Volkswagen Canada routinely made unsolicited no-charge repairs and replacements long after warranty expiration, and apologized for the premature failure. Factory representatives reportedly bought up scrapped VWs. The programs created a rabidly loyal customer base, superlative word of mouth, and an enduring and largely undeserved reliability myth.
Gardiner, that 90 day bumper to bumper warranty was the norm well into the 70s. It was certainly the case with the 76 Blazer and Camaro. After that 90 days you had the 12-month drivetrain warranty. Then you were on your own.
We once bought a brand new, fully loaded Chrysler Town and Country minivan back when they were the last word in minivans (1998). Repeated attempts to fix an intermittent gauge panel light were never successful. Believe it or not, we finally got a 100% refund under lemon law guidelines because they couldn’t fix the stupid lights. We went through the whole procedure, including putting the dealer and Chrysler Corporate on written notice that they had failed to fix a safety related problem three times in a row and that the fourth time needed to fix it, otherwise we would pursue a lemon law refund.
Even with all of that set up, they couldn’t make the stupid instrument cluster lights work reliably. We eventually got all of our purchase cost back including taxes, registration fees, insurance and the lawyer’s fees. We did so without going to court. It was simply a matter of hiring (on 100% contingency) a lawyer who specializes in these cases. He contact Chrysler, did the paperwork shuffle for about two months and then gave us instructions as to where and when to meet the Chrysler regional rep. to turn over the vehicle in return for a check.
Needless to say, we have told the story to hundreds of friends and acquaintances and have never even considered buying another Chrysler product.
How could they be so dense as to not be able to fix a dashboard light problem?
P.S. We replaced the Town and Country with an Oldsmobile minivan … which was another nightmare.
Doug Betts : The decline in our ratings is based on the results for 2008 model year vehicles that were built about one year ago.
Based on our aggressive focus on warranty claim rate reduction, we know that the cars we are building today have a much higher standard of overall quality.
One big problem is that the cars currently on Chrysler lots are 2007 models and 2008 model year vehicles that were built about one year ago.
And even if the cars they are building today have a much higher standard of overall quality, they aren’t building that many of them.
Chrysler’s methodology (at least what they used a few year ago and would have been applied to the vehicles currently on the market) for design verification and proveout put them at a disadvantage compared to other automakers. They relied too much on analytical data rather than vehicle testing. They also don’t incrementally improve their products. Instead they let existing models die on the vine with incremental material cost reductions rather than quality improvements. Then when it is time for a new model, they start from scratch rather than improving an existing platform. This has been the model for vehicle development in Detroit but Ford and GM have at least shown signs of improvement.
Michael Karesh :
October 25th, 2008 at 12:06 pm
TrueDelta doesn’t yet have results for many Chrysler vehicles. The people who tend to participate in our research are those who care about reliability, and people who care about reliability and look at the existing information on Chryslers don’t buy Chryslers.
I disagree, not every Chrysler model is a unreliable when it leaves the showroom. One of my cars is a Chrysler and one is a Toyota, and I am a participant of your website. If you saw at least average reliability according to CR, combined with a low initial cost, and low cost of maintenance (ever paid for Camry struts? Rip off.) even if you cared about reliability would you want to pay an additional $5-6k to Toyota or Honda to roll the dice anyway? That is $5k that is in my pocket now, so I can afford to gamble later.
My experience has been that Chrysler quality is improving, although not on models that were refreshed recently by Daimler. I was surprised however to see that some Toyota models last year were in the CR doghouse.
Of course I do not tend to keep my cars all that long anyway, but I will with the lifetime warranty assuming Chrysler corp has a lifetime.
Wolf
The Dodge Caliber and Jeep Patriot were ranked above industry average and were considered the best models of the company’s brands.
Yikes. I frequent a Jeep Patriot forum (I am not an owner) and a major lament is leaky roofs, regardless of whether they have a sunroof or not. Leaky roofs in a brand new vehicle!! Ruined headliners, multiple visits to befuddled dealers, the works. I would never risk buying a used Patriot as a result, and fans (I think it’s a neat vehicle in its Platonic Jeep Patriot Ideal) are bracing to see if the 2009s are all reliabily dry.
And what makes a “successful” visit? The problematic ones are the unsuccessful visits, when the poor dealer doesn’t even know how to fix the damn thing.
What he said (Schmitt)
John Horner: “You have to give them credit for acknowledging the problems instead of simply throwing mud at CR.”
Right. Does anyone know whether GM ever sent out such a candid letter about product quality?
So is this about the first time that Chrysler takes criticism? I rarely see any efforts to improve their product line…
Let’s see how Chrysler registers on my customized Carmax Trade-In Index*
Chrysler brand vehicles
Trade-in’s with 150k+ miles* = 13 out of 99 (13.1%)
Trade-in’s with less than 100k = 56 out of 99 (56.6%)
If you negate the Chrysler Town & Country, the spread between the two expands from an unfavorable 4 to 1 ratio to a gulf like 7 to 1 ratio. This supports the widely held belief that Chrysler tends to make lousy cars.
Dodge brand vehicles
More than 150k : 32 out of 196 (16.3%)
Less than 100k: 82 out of 196 (41.8%)
Cars did far worse than trucks… the Neon’s ratio was a highly unfavorable 13 to 2.
Jeep Brand Vehicles
More than 150k: 26 out of 103 (25.2%)
Less than 100k: 42 out of 103 (40.5%)
There’s a nice contrast in the data between a low quality model like the Neon and higher quality models such as the Cherokee and Grand Cherokee.
15 Cherokees and Grand Cherokees were traded under 100k while 23 were traded with over 150k. A 60.5% favorable ratio for the pair vs. only a 13.3% for the Neon.
If we remove the Wrangler model, which is usually used in a seasonal manner and therefore has fewer miles on average, the trade-in ratios become dead even. 25 out of 77 for both. Any brand that has a 30% or higher trade-in% for vehicles over 150k+ tends to be in the top five on the CTI. Jeep, Honda, Toyota, Acura, and Lexus are usually the tops in that measurement.
What can we conclude? Measuring the mileage of vehicles traded-in could actually help customers figure out whether a given vehicle will offer a quality product to their customer. For Chrysler, only the Jeep brand has excelled over the last decade and change.
Just as a footnote, the following brands had absolutely zero trade-in’s with over 150k:
Kia (0 for 34)
Suzuki (0 for 12)
Saab (0 for 6)
Land Rover (0 for 20)
The following only had one…
Lincoln (1 out of 40)
Jaguar (1 out of 14)
Cadillac (1 out of 40)
Compared with…
Acura (14 out of 39) 36%
Volvo (11 out of 37) 30%
Jeep… No Wrangler (25 out of 78) 32%
and two of my favorites….
Camry (27 out of 73)
Accord (27 out of 78)
Which still aren’t as good as a 1990’s Volvo… but pretty damn close.
1993-1994 Chrysler is making cash hand over fist. Instead of using this cash to improve quality, they gave employees outrageous bonuses. They they allowed themselves to be bought by Daimler. Then Cerberus (Satan’s Company).
If they go out of business they deserve it.