J.D. Power and Associates Announces (SM) Study Results
12 November 1997
J.D. Power and Associates 1997 Consumer Financing Satisfaction Study(SM) Indicates: New Vehicle Customers are More Satisfied With Their Finance Providers Than Last YearAGOURA HILLS, Calif., Nov. 12 -- In its second study on consumer vehicle financing, J.D. Power and Associates reports that new vehicle customers are more satisfied with their financial providers than last year. VW Credit tops the initial loan satisfaction index, and for the second year, Volvo Finance, North America Inc., achieves the highest rank on the initial lease satisfaction index. Consistent with last year's study, consumers' initial satisfaction with automotive financing providers is driven by three factors: * The set-up process: How well customers are handled during application processing, * The billing process: The accuracy, timeliness, and clarity of the billing, and * The perceived value: The extent to which consumers feel that their finance providers deliver value. Perceived value has the most impact on overall satisfaction, and is even more important than it was last year. Among other notable findings, the J.D. Power and Associates 1997 Consumer Financing Satisfaction Study(SM) points out that consumers are much more satisfied with their financing if it is not arranged by the dealer. "With dealers reliance on finance and insurance (F&I) profits, dealers need to work with their providers to improve the financing sales process or they run the risk of losing out to direct lenders, such as local banks and credit unions," commented David McKay, senior manager of auto financing research at J.D. Power and Associates. Additionally, the study indicated that the customers of most captive providers (vehicle manufacturer owned finance companies) show substantially greater owner loyalty to the manufacturers. Leasing has also been an important loyalty building tool for captives. As captives reduce their emphasis on leasing, these loyalty benefits may be at risk. "To maintain their influence, captives need to develop a process as user-friendly as the direct lending environment," continued Mr. McKay. "With less dependence on leasing, loyalty may depend on captives' ability to maintain the heightened customer communication typical of leases," Mr. McKay concluded. J.D. Power and Associates 1997 Consumer Financing Satisfaction Study(SM) (CFS) results are based on the opinions of 25,357 consumers who recently purchased or leased a new vehicle. The study measures the performance of banks, credit unions, manufacturer owned "captive" finance companies, and independent finance companies. J.D. Power and Associates is an international firm best known for its marketing information services in key business sectors including market research, forecasting, and customer satisfaction. The firm's quality and satisfaction measurements are based on actual customer responses from over a million consumers annually. With its headquarters in Agoura Hills, California, the firm also has U.S. offices in Torrance, California; Michigan; and Connecticut. Its international locations include Japan, Korea, England, Canada and Brazil. J.D. Power and Associates can be accessed through the World Wide Web at http://www.jdpower.com. Email: info@jdpower.com. No advertising or other promotional use can be made of the information in this release or J.D. Power and Associates survey results without the express prior written consent of J.D. Power and Associates. SOURCE J.D. Power and Associates