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Old 08 Jun 2007, 03:24 pm
Rising Sun
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Default GM is missing the point again

The Autobeat http://snipr.com/1n8lb

...General Motors and Chrysler tumbled down the list in J.D. Power and
Associates’ annual Initial Quality Study. The study measures problems
found in the first 90 days of ownership after interviewing 97,000
consumers.

GM did poorly and a company spokesman argued that the survey doesn’t
matter. All of GM’s brands finished below the industry average, which
is 125 problems per 100 vehicles...

The reason it doesn’t matter, says the spokesman, is that the
difference between top performers and the middle of the pack is
statistically irrelevant. Toyota, which tied Jaguar for sixth with 112
problems per 100 vehicles, beat Chevy by just 17 problems per 100 cars.
He makes a point. Few consumers will notice 17 problems per 100
vehicles. The Power study, he told me, is becoming less and less
relevant because quality is reaching parity.

There's some truth to that. But the argument naively misses a huge
point. While some brands like Mercedes moved way up the charts this
year and others, like Chrysler, tumbled way down, hot names like Honda
and Toyota are in the top 10 every year. Every year!

Consumers love and trust those brands. And those companies have been
dining on Motown’s market share for decades now. Sure, Detroit is
close, by the numbers anyway. But consumers won’t believe that Detroit
is as good as Honda and Toyota until they beat them and beat them
consistently in J.D. Power surveys, Consumer Reports studies, word-of-
mouth recommendations and just general buzz. I’m sorry, why should a
guy who’s on his third Toyota or Honda buy a Chevy? Because the initial
quality is almost as good and the disparity is statistically minuscule?
There’s a great sales pitch...
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Rising Sun: http://snipr.com/eat_me_jarhead

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