J.D. Power Finds Honda and Ford Have Highest Customer Retention Rates

Automobile Staff
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Honda and Ford were the best at retaining customers for new 2010 model year vehicles, according to J.D. Power and Associate's 2010 Customer Retention Study. A total of 123,601 people were questioned for the study, which was taken between February and May, and August and October 2010.

Ford and Honda retained 62 percent of their respective owners, J.D. Power reports. High retention rates for the Edge, F-Series, and Fusion kept Ford at the top while the Accord, CR-V, and Pilot were strong models for Honda. This year's study found that Honda owners were most likely to cite resale value and safety for reasons to stay with the brand; Ford owners noted styling and fun-to-drive dynamics.

"Now that economic and market conditions have improved somewhat, vehicle owners are increasingly citing emotional, rather than practical, reasons for staying with their vehicle brand or switching to a different one," said Raffi Festekjian, director of automotive product research at J.D. Power. "In light of this, developing new models with attractive styling and that are perceived as fun to drive is increasingly critical for automakers in order to retain and conquest customers as the market continues to recover."

Consumer desires can change quickly, however, so it's clear that substance in addition to style will remain important as automakers redesign vehicles. Overall, the average customer retention among all brands hasn't changed from last year's study, at 48 percent. The biggest gainer this year was Kia, which jumped 21 percent to 58 percent retention.

Hyundai, Lexus, and Toyota formed a three-way tie for third place, with 60-percent retention. Lexus and Toyota maintained their retention rates for 2010 while Hyundai's improved from 47 percent last year.

At the risk of reviving the "what is a domestic car" debate, J.D. Power found that there is still a sizable gap between the domestic-to-domestic and import-to-import retention rates. The domestic retention rate in 2010 was 69 percent, compared to the import brands' 90-percent rate.

Source: J.D. Power

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