July 10, 2009

How Much Does New Car Quality Differ?

Sometimes when I hear people talk about different car brands they act as if every car made by Honda or Toyota is a marvelous bulletproof miracle that will go 500,000 miles virtually guaranteed with *maybe* a flat tire or something minor like that if you're unlucky. On the other hand many people seem to think that certain American car brands use duct tape and bailing wire as the primary materials in construction and they are virtually guaranteed to require a major engine overhaul within 100,000 miles assuming it doesn't spontaneously burst into flames within days after purchase. Now certainly there are different levels of quality but I think many peoples perception of the relative quality of different car manufacturers is a bit exaggerated.

JD Power Initial Quality Survey (IQS) for 2009 was released recently. JD Power survey's new car buyers to see how many defects the cars had in the first 3 months after purchase. The average was 108 defects per 100 vehicles. They list all the car brands and the number of defects on average per brand. If you look at the PDF version of the JD Power release and scroll to the bottom its easier to see the list of brands and their defect rates.

The best brand was Lexus at 84 defects and the worst was MINI at 166. So the very worst car in the survey had about 2x the number of defects as the very best. Compared to average the Lexus is 22% lower than average and the MINI is 52% higher. The standard deviation among brands is 17.5 so most car brands are between 91 and 125 or +/- 16% of the average.

Average of brands by geography: Asian car brands average 110, American car brands average 120 and European car brands average 124.

Keep in mind that these are average figures. SO you might have one lemon with 10 problems and 9 cars with no defects amount to 1 defect average. Also the study's defect number does not differentiate between different severity of defects. So it counts a broken sun visor as equal to a faulty transmission. But in any case average defects is generally a decent measure of overall quality. I doubt you get many car factories where they screw up all the little details yet someone make a car with a solid drivetrain nor the other way around. Its a fairly safe bet that higher defect levels point to lower quality standards and less reliability overall.

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