Used Cars: Honda Reigns Supreme In Japan

Amidst speculations of how the Wall Street could weigh on the automotive industry sales and GM's request for the government's support on battery development, the car maker Honda has come out on top in satisfying used-vehicle owners in its home ground Japan.

The findings came to light with the release of a J.D. Power study. The study measured used-vehicle owner satisfaction with the dealership sales and delivery process based on four factors that contribute to overall satisfaction: contract and delivery; sales personnel; vehicle purchased; and facility and display.

The following chart shows the results with the points garnered by different manufacturers.
The researchers also spotted that regardless of the vehicle’s model year, customer satisfaction with manufacturer warranties was consistently higher than satisfaction with automotive dealer warranties. For instance, those who purchased a 2002 model-year vehicle or older with a manufacturer warranty, satisfaction scores were 31 points higher, on average, than among customers who received a dealer warranty.

Additionally, customer expectations about the duration of warranty coverage varied according to the cost of the warranty. Of the customers who said that they would like a free warranty included with their used-vehicle purchase, 41 percent said one year's coverage was acceptable. And of the customers who were ready to pay for warranty, 27% wanted coverage for three years, while 24 percent for five years.

The following factors contributed to overall satisfaction of customers.
The study is important because new-vehicle sales have decreased in Japan, consequently, vehicle manufacturers are focusing their efforts on used-vehicle business in order to remain profitable.

Also, as the study has shown, warranties are an important factor affecting customer satisfaction, which in turn affects recommendations and repurchase intentions. So there's a need for dealers to review their current warranty programs and bring them at par with customer needs. Further, the non-authorized used-vehicle dealerships who don't have partnerships with vehicle manufacturers need to ensure that their warranties match manufacturer warranties.

Honda seems to be in the limelight for good showing in different areas, including its concept Honda Insight which is to show up at the upcoming Paris Motor Show.