Lutz GM: Will Match Japan Quality in 2-3 Years

AUSTIN, Texas September 17,2002 Reuters reported that General Motors Corp. Vice Chairman Bob Lutz said that the U.S. automaker will match the quality of Japanese rivals Toyota Motor Corp and Honda Motor Co in two to three years, but it will take longer for the public to acknowledge the gains.

GM, the world's largest automaker, has steadily improved its score in the J.D. Power and Associates Initial Quality Study (IQS), a benchmark industry study on quality which polls owners during their first 90 days of ownership. Among multi-brand automakers, GM became the first U.S. automaker to place third in the study earlier this year, behind the Japanese automakers Toyota and Honda.

"In two to three years' time, we will match Toyota and Honda -- not only in IQS, we are going to match them in long-term durability and reliability," GM Vice Chairman Bob Lutz said late Monday on a plane trip to a media event in Austin, Texas.

But he said it would take about five years for GM's improved quality to be fully recognized by the buying public. "You just have to be patient," he said.

Detroit automakers' failure to match their Japanese competitors in quality has caused many American consumers to steer clear of their vehicles. Late last year, German-American automaker DaimlerChrysler AG's U.S. Chrysler unit began offering a seven-year warranty on its engines to reassure buyers that it backed up the quality of its vehicles. Chrysler moved up to fourth position in the J.D. Power study this year, while Ford Motor Co. placed fifth.

As Toyota and Honda expand their vehicle lineup, and add more assembly plants in the United States, they will experience some of the quality problems that come with size, as GM has, Lutz said. "They're going to be more like us," Lutz said.

Lutz, a former top executive with Chrysler who joined GM last year, said that GM has "an army of guys" trained in problem solving to quickly determine the cause of any quality problem. He said that GM has halved the time it takes to put the solution to any vehicle quality problem into production on the assembly line, and GM will halve that time again.

He said that GM's improved quality is resulting in substantial savings on warranty costs.

"Quality and warranty is an area where I'm convinced we can catch them," Lutz said.