Increased Consumer Familiarity with Navigation Systems Pressures Manufacturers to Enhance Functionality and Add Value

Alpine Navigation System in Acura TL Ranks Highest in Customer Satisfaction

November 15, 2004

WESTLAKE VILLAGE, Calif.—As consumers become more familiar with factory-installed navigation systems in their vehicles they are demanding more functionality from their systems, according to the J.D. Power and Associates 2004 Navigation Usage and Satisfaction StudySM released today. Thirty-six percent of current navigation system owners have prior experience with navigation systems, a six percent increase in just two years.

Among navigation systems included in the study, the system supplied by Alpine for the 2004 Acura TL ranks highest in customer satisfaction. This marks the fourth time in the six-year history of the study that an Alpine navigation system ranks highest in customer satisfaction.

“In-vehicle navigation is no longer a novel concept,” said Melissa Sauter, director of the automotive emerging technologies practice at J.D. Power and Associates. “We estimate that approximately 850,000 2004 model-year vehicles have a factory-installed navigation system. And navigation systems are now offered in a variety of vehicle types, ranging from luxury sedans to minivans and pickups.”

The study shows that many vehicle owners with factory-installed navigation systems are not delighted with the value provided by such systems.

“Consumer expectations are a moving target,” Sauter said. “Each year we see manufacturers improve their navigation systems, but vehicle owners continue to expect more from this evolving technology.”

Owners indicate that real-time traffic information is one area where manufacturers can enhance the value of navigation systems. Systems with access to real-time traffic information would enable consumers to detect impeding accidents and slow traffic conditions, allowing them to adjust their routes accordingly. The first navigation system with real-time traffic is being offered in one 2005 model-year vehicle, the Acura RL.

“Real-time traffic-enabled systems are likely to capture the attention of many new vehicle buyers, as nearly every navigation system owner surveyed expressed interest in this new feature,” Sauter said.

Survey respondents express a desire for navigation systems to have expanded points-of-interest information that provides such features as business hours, telephone numbers and restaurant menus. Automatic software updates are also in high demand.

“Introducing enhanced functionality is one way to improve the perceived value of these systems, but it is critical that manufacturers do so with an eye toward keeping the systems as easy to use as possible,” Sauter said.

Ease of use continues to be the most important contributor to customer satisfaction with navigation systems. The ease of inputting destinations is particularly important. Systems with touch screens and voice recognition receive higher levels of customer satisfaction than systems without these features.

The study finds that navigation systems supplied by Japanese manufacturers outperform European- and domestic-branded systems—a trend that continues from the 2003 study.

Regardless of the navigation system supplier, the study results indicate that there is room for improvement in the area of selling and servicing navigation systems. Some of the lowest-rated attributes in the study relate to the dealers explanation of how to operate the system, upgrade the systems software and the dealers ability to service the system.

“Many dealers today, particularly those with limited experience selling vehicles that offer navigation, are falling short of customer expectations,” Sauter said. “Educating dealers is a critical element in the customer satisfaction equation that is often overlooked. The more knowledgeable dealers become about navigation systems and their benefits, the more likely they are to order vehicles with the option and to work harder to sell and service the systems.”

The 2004 Navigation Usage and Satisfaction Study is based on the responses from 9,271 owners who recently purchased or leased vehicles with factory-installed navigation systems.