Who's The Most Pampered Motorist Of All?
Locked the keys in your Lexus? Don't worry, just call your dealer. He's likely to tell you to break in through a rear window, then stop by later so he can replace the window for free. Seats in your Infiniti Q45 too hard? Infiniti will probably rebuild them to your liking.
Owners of Lexus and Infiniti cars, the luxury Japanese models launched by Toyota and Nissan in the fall of 1990, delight in such tales of extraordinary service, which some call the best available from any carmaker. "Lexus and Infiniti are creating a different standard against which all others will be judged," says Maryann N. Keller, auto analyst at Furman Selz Inc.
MAKING NICE. The Lexus and Infiniti dealers, of course, gush over customers to sell more cars. But now they have another compelling reason to make nice. This is the first year both brands qualify for consideration in the Customer Satisfaction Index, or CSI, of J. D. Power & Associates Inc. (table).
For the past 10 years, J. D. Power has been quizzing drivers about their love-hate relationships with their cars and tabulating its findings on car quality and service into an overall index. J. D. Power publishes other car ratings--one for newly purchased autos comes out May 31--and it now evaluates computers. Other firms also rate cars, but Power's CSI, which is released in July, is the most prestigious. Honda Motor Co.'s Acura division has topped the CSI for the past four years, and the company has trumpeted the fact in heavy advertising.
Now, Acura and the top runners-up--Mercedes, Toyota, Cadillac, and Honda--face the possibility that Lexus and Infiniti will edge two of them from the top five. "We're out for No. 1," says Infiniti General Manager William R. Bruce. The betting among dealers and analysts is that Lexus and Infiniti are running neck and neck in their race for the honors. Each company's flagship product, a $40,000 sedan, is superbly engineered. Lexus may have a slight edge in quality. A Consumer Reports survey gives better marks to Lexus than to Infiniti for its repair records. But Infiniti seems to be outdoing Lexus on customer service.
Both Infiniti and Lexus see the care and feeding of customers as a crucial skill which they can use to stand out in the glutted luxury car market. J. D. Power agrees. "Customer handling" has always accounted for 40% of the final score in the Power CSI. But now the Agoura Hills (Calif.) market researcher is likely to boost that category to 50% or 60% of the tally this year. Says Gun Dukes, who administers the CSI at J. D. Power: "How they're treated at the dealership has become more important to customers and should carry greater weight."
CODDLING. That realignment could put Acura and others at a slight disadvantage. When it was launched in 1985, the Acura Legend far surpassed anything on the market for quality. Acura also required its dealers to set up separate showrooms that, instead of having three or four car lines on the same showroom floor, feature only Acura models. So dealer personnel get to learn the ins and outs of only a single car line, and mechanics are more likely to fix problems the first time. "Exclusivity contributes a lot to customer satisfaction," says Acura Vice-President Ed Taylor.
With Lexus and Infiniti, Toyota and Nissan have advanced the competition in service. And unlike Acura, which has no formal training in the art of coddling customers, both Lexus and Infiniti set up programs to ensure that everyone understands the focus on the customer.
Lexus and Infiniti seemingly will do anything to keep buyers pleased. Lexus has bought cars back from owners unhappy with such details as polishing marks on the paint finish. Richard L. Chitty, customer satisfaction manager at Lexus, has used owner surveys and dealers' average gross profits to calculate the cost of customer dissatisfaction. While the cost to the best dealer is only $4,300 a year, cost to the worst dealer is $66,762 in lost gross profits. Says Chitty: "That assumes the lost customer would only buy one more car. And it doesn't count the 200 or so friends he complained to about the experience."
Lexus has recently started a study course that all dealership employees must pass. Every Lexus employee must also phone at least one new Lexus owner a week to see how he or she likes the car. Infiniti is even more ambitious. To reward superior customer service, an Infiniti customer-satisfaction fund doles out up to $100,000 a year per dealer. Dealers typically distribute half of that bonanza to their employees. Infiniti figures out what to pay dealers by calling every customer who bought a car or a part or who required service. And it employs "mystery shoppers" to check up on dealerships.
To qualify for the bucks, dealers must send every employee--from the owner right down to the receptionist and lot attendants--to Scottsdale, Ariz., for an intense week-long training session. There they're drilled on product knowledge and service skills. They spend days with professional racers and actually drive competitors' cars on a track. Dealers say training alone costs $20,000 to start a new dealership. But Infiniti also pays 80% of the cost of loaner cars at the dealerships, so that every customer with a service appointment gets one. "My competitors call it a subsidy," Infiniti's Bruce says. "I call it investment in the brand."
CAR SWAPPING. Whatever you call it, it helps. "When you have a problem, there's no inconvenience," says Sheryl Feuerstein, a Burson-Marsteller Inc. vice-president who had to use several Infiniti loaners. She has since talked her brother and several friends into buying Q45s. And Gary D. Nesen, the only dealer in the country with Infiniti, Lexus, and Acura franchises, finds that his Infiniti store consistently ranks highest in customer satisfaction. "Lexus and Acura just talk to you about it, but Infiniti knows what motivates us," he says. "They pay us to make sure customers are taken care of." A visit by a mystery shopper, however, did cost Nesen $2,500 in lost bonuses: The dealership's lawn needed mowing.
As Lexus and Infiniti vie for J. D. Power's most prestigious award, there are signs that other carmakers are getting the message on customers. Oldsmobile, for example, now lets any new owner swap his or her car for another within the first 30 days, for any reason. But General Motors Corp.'s new Saturn Div. has gone the furthest, building a network similar to Lexus' and Infiniti's and starting Infiniti-like dealer-training programs.
Maybe Saturn and other middle-of-the road U. S. nameplates will someday become serious contenders for the Power trophy. Then the real winner will be the customer.
MAKING THE GRADE
Assembling the J.D. Power & Associates Customer Satisfaction Index (CSI) for auto makers
1 In March, J.D. Power mails out a six-page questionnaire to 73,000 owners of 1990 model cars. Owners get $1 for responding. About 23,000 do
2 Consumers answer 23 detailed questions about their experiences for the first year of owning a model. The questions, which deal with everything from transmission performance to getting your repair bill explained, measure overall customer satisfaction
3 Results are released in July. Carmakers buy the research, while the nameplate in first place has sole permission to advertise its ranking
DATA: J.D. POWER & ASSOCIATES
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