J.D. Power and Associates Reports:
Customer Satisfaction with the New-Vehicle Sales Process Reaches Record Levels as Dealers Strive to Be in Better Sync with the Needs of Their Customers

Jaguar Ranks Highest in Sales Satisfaction for a Third Consecutive Year


WESTLAKE VILLAGE, Calif.: 15 November 2006 — Customer satisfaction with the new-vehicle sales process has reached a record high, according to the J.D. Power and Associates 2006 Sales Satisfaction Index (SSI) StudySM released today.

The study, now in its 20th year, is a comprehensive analysis of the new-vehicle purchase experience. Overall customer satisfaction is measured based on five factors: dealership facility, salesperson, paperwork/finance process, delivery process and vehicle price.

The industry achieves a record high overall SSI score of 847 on a 1,000-point scale—a 5-point improvement from 2005. However, a leading cause of lost sales at new-vehicle dealerships is poor customer treatment. Nearly one-half of all shoppers who walk away from a dealership cite poor treatment as a reason.

“Today’s vehicle shoppers are well armed with information before they even set foot inside a dealership,” said Jane Crane, director of automotive retail research at J.D. Power and Associates. “Equipped with readily available vehicle model/features, inventory and pricing information, more than one-half of new-vehicle buyers visit only their selling dealer. It’s more important than ever for dealers to be in sync with the changing needs of their customers, particularly with regard to the length of the sales process, the salesperson and negotiating the deal.”

The study finds that customers are particularly sensitive to time-related issues when purchasing a new vehicle. On average, the entire purchase process takes approximately 3 hours. Vehicle selection typically takes the most time, averaging 47 minutes, followed by negotiating the deal (38 minutes) and paperwork/finance (32 minutes). One area impacting sales satisfaction is the time customers wait between negotiating the deal and beginning the paperwork and financing process, which currently averages 31 minutes.

“Just sitting around waiting to begin the paperwork process is a slippery slope, which is why it is critical for the dealership to manage the buyer’s time productively,” said Crane. “When the finance department is unable to promptly meet with customers, the dealership should try to choreograph the process so that customers are not sitting around idly. Taking the opportunity to introduce the customer to the service department or acquainting the buyer with the features of the new vehicle can go a long way toward neutralizing negative feelings about the wait.”

Nearly one-third of all new-vehicle sales occur on either a Saturday or Sunday. However, satisfaction is consistently lower on the weekend compared to weekdays on every factor, primarily due to a longer process. Overall, it takes an average of 22 minutes longer to purchase a car on a Saturday or Sunday.

Jaguar ranks highest in satisfying buyers with the new-vehicle sales process, receiving the highest index score since the study was redesigned five years ago. With an SSI score of 912, Jaguar leads its closest competitor, Cadillac, by 21 points. Jaguar ranks highest for a third consecutive year.

The purchase experience sets the tone for the subsequent relationship with customers during the entire vehicle-ownership cycle, according to the study. While four of five new-vehicle buyers express a general interest to spend future service dollars at the selling dealer, less than one-half (45%) indicate they “definitely” plan to do so. As sales satisfaction declines, the intention to return also declines.

The 2006 Sales Satisfaction Index Study is based on responses from 42,218 new-vehicle buyers who registered their vehicles in May of 2006.

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.