Younger buyers report more problems with their new cars than older buyers, Brian Walters, senior director of automotive research at JD Power told the second annual South African Automotive Conference.
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This will become a major headache for car makers because the big growth area for new car sales is in developing markets where buyers are younger. Customers in developing markets report more than twice as many problems as those in established markets, he said.
Over the next five years global vehicle sales will reach 75 million, an increase of 24% over 2000 and double the rate of growth in the previous five years from 1995, Walters told delegates.
Asia Pacific markets will account for 51% of that growth and Africa and the Middle East 28% while established markets like North America will grow by just 7%.
Research in South Africa showed that younger buyers – those under 40 – reported 354 faults per 100 cars against older buyers – those aged over 55 – who reported 207 problems. But they are all the same type of problems.
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By GlobalDataIn South Africa owners report 2.5 times as many problems on average than owners in the US. This can be accounted for by the age of owners, while the sales mix of different models can have a dramatic effect, said Walters.
The Toyota Corolla accounts for 25% of Toyota’s SA sales but only 15% of US sales, for example.
Engineering accounts for 72% of all problems, manufacturing for 23% and sales and service 5%. “You have to design quality into a vehicle from the start,” said Walters. The average imported vehicle in SA has 30% fewer problems than SA-built models.
In the US there is now very little difference between car makers in terms of quality with the Koreans having improved by 57% between 1998 and 2004. “This shows the need for continuous improvement to keep up with your competitors,” said Walters.
The new battleground will be long-term dependability, he said.
“Most problems are design and engineering related, not manufacturing related although manufacturing has a very important role to play,” he added.
“It means it is more important than ever to understand your customers and markets – a strength in one market might be a weakness in another.”
