U.S. Automakers Closing Quality Gap

MILWAUKEE--Aug. 15, 2006--Despite rising vehicle costs and gas prices, consumers are giving the auto industry its highest perceived quality rating in a decade, according to the Quarterly Quality Report, released today by the American Society for Quality (ASQ). The personal computer category also experienced significant gains in perceived quality, primarily due to improved service levels.

"The increases in this quarter's American Customer Satisfaction Index (ACSI) results indicate a stronger focus on improving customer service by both the auto and personal computer sectors," said Jack West, spokesperson for the ASQ and the author of the Quarterly Quality Report. "In the auto industry, Japanese manufacturers like Toyota and Honda continue to exploit their competitive distinction in engineering and innovation, while the bigger surprise is that U.S. brands like General Motors and Ford's quality improvement processes are beginning to close the gap with their import competitors."

The ASQ Quarterly Quality Report expands on of the most critical components of the ACSI scores released today: perceived quality of the goods and services measured by the ACSI. This quarter's Quality Report focuses on customers' perceived quality of the goods and services provided in manufacturing durables (autos, personal computers, major appliances, electronics) and e-business. The ACSI reports on different industry sectors each quarter. The ACSI is produced by the University of Michigan's Ross School of Business in partnership with the American Society for Quality and CFI Group, with e-commerce sponsor ForeSee Results.

Automobiles

This quarter the auto industry's perceived quality score as measured by the ACSI stands at 87, bringing it back to its highest level since the second quarter of 1995. Overall quality perceptions for the industry have been historically stable despite a number of economic challenges. Nevertheless there are a few stand-out brands such as the GMC division of General Motors which this quarter experienced the highest increase in perceived quality.

U.S. brands are making progress in closing the quality gap. However, only domestic luxury brands Buick and Cadillac rank with the reigning quality leaders including Toyota, Honda and BMW. Hyundai wins for the best turnaround story with long-term gains of 12.7 percent over the last decade.

"Although Hyundai is a late-comer to the dance, the brand has been steadfast in applying a simple but effective two-pronged quality process," said West. "In addition to its intense focus on consumer input, Hyundai emphasizes process improvement to refine problem areas such as its electrical systems and automatic transmission design. Another contributing factor may be that Hyundai continues to offer the best warranty in the industry."

Personal computers

The quality index for the maturing personal computer category made a significant jump of 3.8 percent primarily due to gains by Dell, Inc. While it has surpassed its rival Hewlett-Packard in terms of quality, Dell still trails the quality leader in personal computers - Apple - by a significant amount. Apple's strong sales of Macintosh computers boosted profit in the quarter ended July 1.

"It appears likely that Dell's rebound is based largely on restoration of their service levels which have dipped significantly over the past five years," said West. "Dell's $100 million commitment to beef up its U.S. service centers is clearly having a positive effect."

About the Quarterly Quality Report

ASQ's Quarterly Quality Report is an analysis of customers' perceptions of the quality and reliability of products and services. The Report is based on data generated by the nation's leading measure of customer satisfaction, the American Customer Satisfaction Index (ACSI). To view the entire Quarterly Quality Report visit http://www.asq.org/quality-report/.

About the ACSI

The American Customer Satisfaction Index is a national economic indicator of customer evaluations of the quality of products and services available to household consumers in the United States. The index is produced by the University of Michigan's Ross School of Business in partnership with ASQ and CFI Group, and is supported in part by ForeSee Results, corporate sponsor for the e-commerce and e-business measurements, and by Market Strategies Inc., a major corporate contributor.

About the American Society for Quality (ASQ)

The American Society for Quality (ASQ) is the world's leading authority on quality. With more than 93,000 individual and organizational members, the professional association advances learning, quality improvement, and knowledge exchange to improve business results and to create better workplaces and communities worldwide. As champion of the quality movement, ASQ offers technologies, concepts, tools, and training to quality professionals, quality practitioners, and everyday consumers, encouraging all to Make Good Great(TM). ASQ has been the sole administrator of the prestigious Malcolm Baldrige National Quality Award since 1991. Headquartered in Milwaukee, Wisconsin, the 60-year-old organization is a founding partner of the ACSI, a prominent quarterly economic indicator.