J.D. Power and Associates Reports: Dealerships Increasingly Perform Vehicle Repair and Maintenance Work Right the First Time

Customer Satisfaction Increases as Dealerships Address the Need for Speed in the Service Departments

WESTLAKE VILLAGE, Calif., Aug. 3 -- When it comes to repairs and maintenance, auto dealerships are doing better at getting the work done right the first time and having the vehicle ready when promised, according to the J.D. Power and Associates 2006 Service Usage and Retention Study(SM) (SURS) released today.

SURS finds that 86 percent of owners who took their vehicle to the dealership for a repair indicate that the work was done right the first time -- up from 72 percent in 2001 -- and 87 percent say the dealership had the vehicle ready when promised -- up from 82 percent five years ago.

The study, now in its 10th year, measures customer satisfaction of vehicle owners who visit a dealer service department for maintenance or repair work during the fourth or fifth years of ownership, which typically represents the period after the manufacturer's vehicle warranty expires. Overall customer satisfaction is based on six factors (in order of importance): service initiation, service advisor, service quality, user-friendly service, service delivery, and in-service experience.

"Time is important in every aspect of consumers' lives, and auto service customers, especially younger customers, are very sensitive to time," said Jeff Zupancic, director of automotive retail research at J.D. Power and Associates. "Any dealership process or event that extends the service visit or causes repeat dealer visits significantly erodes satisfaction. Despite the importance of time to customer satisfaction, this has been a difficult challenge for dealerships to overcome."

The importance of time to auto service customers is evident in that more than one-half of SURS index scores are driven by time-related attributes, including the time it takes to speak to a service advisor, completing the repair or maintenance right the first time, convenience of service hours of operation and having the vehicle ready when promised. Many dealers have responded to customer demands for convenience and quick service by installing service lanes dedicated to routine maintenance such as oil changes, expanding their service hours and refining their service processes.

The study finds that dealer efforts to address time issues are resulting in higher levels of customer satisfaction. Overall, customer satisfaction with the dealer service experience has increased seven index points from 2005 to 852 index points on a 1,000-point scale. Eighty-nine percent of respondents using a dealership for service report they were able to get a service appointment on the day they desired. When they arrived at the dealership, 48 percent of respondents indicate they were greeted immediately by a service advisor, while an additional 38 percent note they had to wait less than five minutes.

Among respondents who had their vehicle repaired at a dealership, 85 percent indicate that the vehicle was fixed the same day they dropped it off. Only 6 percent of customers had to wait three or more days for their vehicle. However, once the work was completed, only 67 percent of respondents indicate that it took five minutes or less to fill out the appropriate paperwork and drive off with their vehicle.

"The time elements of the service process are absolutely crucial," Zupancic said. "That's where the service advisor plays a key role, from greeting the customer when they walk in, listening to them and understanding exactly what they need for their vehicle, keeping them informed about what work needs to be done and managing their expectations on when the vehicle will be ready. The service advisor is the key link between the dealership and the customer. If the service advisor can develop a professional relationship with the customer and build a level of trust, the customer is generally much more satisfied with the overall service experience. If customers aren't happy, they express their displeasure by taking their business elsewhere."

The study finds that customers "delighted" (providing a score of 10 and a 10-point scale) with their service experience indicate that they are two- thirds more likely to return to the dealership for customer-paid work the next time their vehicle needs maintenance or repair service than customers simply "pleased" (8-9 points) with their experience. In addition, "delighted" service customers are nearly 60 percent more likely to purchase or lease the same make of vehicle for their next purchase than those only merely "pleased" with their service experience.

"The service department has a great impact on the entire business at the dealership," Zupancic said. "A poor service experience may not only cause the dealership to lose future repair and maintenance business, but also future vehicle sales opportunities. Dealerships need to do a great job of satisfying customers during and after the sale in order to keep their customers coming back."

The study also finds that among premium brands, Lexus, Cadillac and Acura perform particularly well in satisfying customers with the service experience after four and five years of ownership. Among non-premium brands, Buick and Saturn perform well. Goodyear Tire and Firestone Tire service centers perform well among non-dealer service facilities.

The 2006 SURS is based on responses from 11,596 owners of 2001 and 2002 model-year vehicles.

About J.D. Power and Associates

Headquartered in Westlake Village, Calif., J.D. Power and Associates is an ISO 9001-registered global marketing information services firm operating in key business sectors including market research, forecasting, consulting, training and customer satisfaction. The firm's quality and satisfaction measurements are based on responses from millions of consumers annually. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

Founded in 1888, The McGraw-Hill Companies is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands such as Standard & Poor's, McGraw-Hill Education, BusinessWeek and J.D. Power and Associates. The Corporation has more than 290 offices in 38 countries. Sales in 2005 were $6.0 billion. Additional information is available at http://www.mcgraw-hill.com/.