full text:
Higher Vehicle Appeal May Allow for Lower Dealer Incentives
Honda captures four model segment awards -- more than any other vehicle nameplate this year -- according to the J.D. Power and Associates 2007 Automotive Performance, Execution and Layout (APEAL) Study(SM) released today.
The study, now in its 12th year, measures owner delight with the design, content, layout and performance of their new vehicles. APEAL is designed to complement the J.D. Power and Associates Initial Quality Study(SM) (IQS), which focuses on problems experienced by owners during the first 90 days of ownership. APEAL measures how gratifying a new vehicle is to own and drive.
Honda's four segment-leading models are the Fit (in a tie), CR-V, Ridgeline and Odyssey. BMW and Mercedes-Benz receive three segment awards, while Ford, Nissan and Volkswagen each garner two awards. BMW models receiving awards include the 3 Series, 6 Series and X5, while Mercedes-Benz earns awards for the E-Class, S-Class and GL-Class. Ford models earning awards are the Mustang and Edge. Volkswagen receives awards for the Jetta and GTI, while Nissan earns awards for the Altima Sedan and Armada.
The study also finds that, for models with higher APEAL scores, vehicle manufacturers and dealers can offer lower incentives to new-vehicle buyers. On average, owners of vehicles with APEAL scores lower than 800, based on a 1,000-point scale, report receiving dealer incentives of approximately $2,000. For purchasers of models with average APEAL scores higher than 800, the incentive amount can decline by up to 10 percent.
"Vehicle models with strong customer appeal tend to be in higher demand, which diminishes the need for dealers to incentivize to boost sales," said Neal Oddes, director of product research and analysis at J.D. Power and Associates. "Offering larger incentives decreases the profitability of vehicles, so it's important for manufacturers to incorporate those 'must-have' features and design elements that will entice buyers, which also reduces the need for large customer cash rebates."
A number of all-new and redesigned models lead the model rankings for 2007. Ten of the top-ranking models in the APEAL study -- the BMW X5, Cadillac Escalade EXT (in a tie), Ford Edge, GMC Sierra LD, Honda Fit, Honda CR-V, Mercedes-Benz GL-Class (in a tie), Mercedes-Benz S-Class, Nissan Altima Sedan and Toyota Yaris (in a tie) -- were all-new or redesigned this year. Also receiving awards are the Hyundai Azera and Porsche Cayman.
"Whether due to fresh designs or innovative features, APEAL scores tend to be highest for models when they are first introduced," said Oddes. "It's essential for manufacturers to get new-vehicle launches right, since vehicles with high appeal scores generally command a higher gross profit and sell more quickly. Two of the redesigned models -- the Mercedes-Benz S-Class (in a tie) and Honda CR-V -- also earned awards in the 2007 Initial Quality Study, and are examples of how manufacturers can learn from preceding models to improve in both initial quality and appeal."
The Nissan Armada ranks highest in its segment for a fourth consecutive year. Several models, including the Ford Mustang, Honda Ridgeline and Honda Odyssey rank highest in their respective segments for a third consecutive year, while the Porsche Cayman and Hyundai Azera earn awards for a second consecutive year. The Mustang and Mercedes-Benz E-Class also rank highest in their segments in both the APEAL study and IQS.
Porsche is the highest-ranking nameplate in APEAL for a third consecutive year. The most improved nameplate in the 2007 study is Scion.
The 2007 APEAL Study is based on responses gathered between February and May 2007 from more than 91,000 purchasers and lessees of new 2007 model-year cars and trucks who were surveyed after the first 90 days of ownership.

  2007 Nameplate APEAL Ranking(Based on a 1,000-point scale)

  Porsche              849
  BMW                  847
  Mercedes-Benz        844
  Jaguar               841
  Lexus                836
  Audi                 829
  Infiniti             823
  Cadillac             818
  Land Rover           816
  Acura                815
  Lincoln              810
  Scion                809
  Volkswagen      800
  Volvo                792
  Saab                 784
  Mazda                777
  Honda                776
  Nissan               776
  HUMMER               773
  Industry Average     772
  Mitsubishi           770
  GMC                  768
  Hyundai              766
  Chevrolet            763
  Pontiac              762
  Toyota               761
  Saturn               757
  Ford                 754
  Buick                750
  Mercury              743
  Kia                  742
  Chrysler             740
  Suzuki               738
  Dodge           737
  Subaru               724
  Jeep                 718

  NOTE: Not included due to small sample size are: Isuzu and MINI.

  Top Three Models per Segment
  Car Segments
  Sub-Compact Car
  Highest Ranked: Honda Fit (Tie), Toyota Yaris (Tie)
  Nissan Versa

  Compact Car
  Highest Ranked: Volkswagen Jetta
  Volkswagen Rabbit
  Honda Civic

  Compact Sporty Car
  Highest Ranked: Volkswagen GTI
  Scion tC
  Volkswagen Eos

  Compact Premium Sporty Car
  Highest Ranked: Porsche Cayman
  Porsche Boxster
  Mercedes-Benz CLK-Class

  Entry Premium Car
  Highest Ranked: BMW 3 Series
  Lexus IS 250/IS 350
  Acura TL (Tie)
  Audi A4 (Tie)

  Midsize Premium Car
  Highest Ranked: Mercedes-Benz E-Class
  Lexus GS 350/GS 430/GS 450h
  BMW 5 Series

  Large Premium Car
  Highest Ranked: Mercedes-Benz S-Class
  BMW 7 Series
  Lexus LS 460

  Premium Sporty Car
  Highest Ranked: BMW 6 Series
  Mercedes-Benz SL-Class
  Chevrolet Corvette

  Midsize Sporty Car
  Highest Ranked: Ford Mustang
  Mitsubishi Eclipse
  Chevrolet Monte Carlo

  Midsize Car
  Highest Ranked: Nissan Altima Sedan
  Volkswagen Passat
  Saturn AURA

  Large Car
  Highest Ranked: Hyundai Azera
  Toyota Avalon
  Dodge Charger

  Truck / Multi-Activity Vehicle (MAV) Segments
  Compact MAV
  Highest Ranked: Honda CR-V
  Mazda CX-7
  Toyota FJ Cruiser

  Midsize MAV
  Highest Ranked: Ford Edge
  Saturn Outlook
  GMC Acadia

  Large MAV
  Highest Ranked: Nissan Armada
  Chevrolet Tahoe
  Chevrolet Suburban

  Midsize Premium MAV
  Highest Ranked: BMW X5
  Audi Q7 (Tie)
  Mercedes-Benz M-Class (Tie)

  Large Premium MAV
  Highest Ranked: Cadillac Escalade EXT(Tie),Mercedes-Benz GL-Class(Tie)
  Lincoln Navigator

  Large Pickup
  Highest Ranked: GMC Sierra LD
  Chevrolet Avalanche
  Chevrolet Silverado LD

  Midsize Pickup
  Highest Ranked: Honda Ridgeline
  Ford Explorer Sport Trac
  Toyota Tacoma

  Van
  Highest Ranked: Honda Odyssey
  Kia Sedona
  Hyundai Entourage

NOTE: Models with multiple trim levels are combined for ranking purposes.

J.D. Power and Associates is a business unit of The McGraw-Hill Companies. (NYSE:MHP)
Web site:
http://www.jdpower.com/
http://www.mcgraw-hill.com/

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