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Toyota Sinks in Quality Survey After Recalls; Ford Makes Top 5

2010 Toyota Prius hybrid cars
2010 Toyota Prius hybrid cars sit in the sales lot at Elmhurst Toyota in Elmhurst, Illinois, U.S. Photographer: Tim Boyle/Bloomberg

Toyota Motor Corp. and Ford Motor Co. both set records for their namesake brands in the annual J.D. Power & Associates survey of new vehicle quality, with Toyota dropping to its worst ranking since the report began and Ford making its first foray into the top five performers.

Toyota fell to 21st place from sixth in the Westlake Village, California-based market-research firm’s initial quality report, which measures consumer complaints in the first 90 days of vehicle ownership.

High scoring brands do a better job of keeping customers, with owners of cars in the top quartile buying the same brand 59 percent of the time while brands in the bottom quartile keep just 44 percent of their purchasers, J.D. Power said.

“Toyota’s problems were directly related to the recalls. This will certainly hurt their image a bit,” said David Sargent, J.D. Power’s vice president of global vehicle research. “For Ford, this is the culmination of nine years of improvement.”

The fifth-place ranking for Ford, the own-brand of the Dearborn, Michigan-based automaker, ranked it first among mass-market nameplates. The top four performers were luxury brands: Porsche AG’s namesake vehicles, Honda Motor Co.’s Acura, Daimler AG’s Mercedes-Benz and Toyota’s Lexus, the market-research firm said.

Below Industry Average

Toyota vehicles, which comprised the bulk of the parent company’s recall, saw problems per 100 vehicles rise to 117 from 101, J.D. Power said yesterday. That pushed the brand’s scores below the industry average, 109 problems per 100 cars in 2010, for the first time in the survey’s 24-year history, J.D. Power said.

Owners of Toyota vehicles complained mostly about parts involved in the recalls, such as brake pedals and floor mats, Sargent said.

“Overall we’re probably disappointed, but not surprised,” Jim Lentz, Toyota’s U.S. sales chief, said in a conference call yesterday. “It was really the vehicles in the recall that were hit pretty hard.”

Sargent said he expects Toyota to improve from this year’s results because the company likely will remedy in 2011 model-year vehicles the problems that led to the recalls.

“What will be tougher is improving their reputation,” Sargent said.

Toyota President Akio Toyoda said in a May interview that scrutiny from inside and outside the company has been a “good lesson” and he expects the carmaker to emerge stronger after the recalls. The problems may be connected to Toyota’s rapid expansion as it grew to become the world’s largest carmaker, he said.

Toyota’s luxury Lexus brand finished fourth in the survey with 88 complaints per 100 vehicles, down from first place with 84 last year.

Topping Category Rankings

The Japanese automaker made some achievements in this year’s report: Including Lexus models, Toyota took first place in six of 20 vehicle categories, more than any other manufacturer. Honda, GM, and Ford, not including Volvo, each took first in three vehicle categories.

Jeep and Chrysler brands from Chrysler Group LLC, based in Auburn Hills, Michigan, performed better than last year while failing to meet the industry average. Chrysler finished 23rd, with 122 complaints per 100 vehicles, Jeep ranked 27th and Dodge was 28th. The automaker is controlled by Italy’s Fiat SpA.

Among Detroit-based General Motors Co.’s four brands, only Buick reported fewer problems than in 2009 and all GM brands finished below the industry average.

New Models

Cadillac tumbled from third place last year with 91 problems to 13th this year with 111 problems. Cadillac’s new SRX crossover sport-utility vehicle performed worse than the luxury brand’s older vehicles, dragging its results down.

Carmakers often encounter more problems with models in their first year of production, Sargent said. GM had several new models included in the survey.

“Frankly, none of the new vehicles performed particularly well,” Sargent said.

GM spokeswoman Katie McBride said the company has engineers working on quality issues.

“We need to focus on launches,” she said. “We have our work to do.”

Chevrolet dropped from ninth place last year with 103 problems to 14th with 111 problems, and truckmaker GMC fell from 18th with 116 problems to 25th with 126 problems.

On the same day that GM and Toyota were given lower scores on the J.D. Power report, the two companies announced they are increasing production.

GM said it will run nine of its 11 U.S. assembly plants during the customary summer shutdown from June 28 to July 9 to meet stronger demand. That will add as many as 56,000 vehicles to production, the company said.

Toyota, based in Toyota City, Japan, said it would resume plans to use a plant in Blue Springs, Mississippi, that was mothballed in December 2008 when car sales slumped.

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