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J.D. POWER STUDY FINDS WEAK RELATIONSHIPS WITH AUTO COMPANIES, NEGATIVE FINANCIAL INVESTMENT OUTLOOK CLOUD DEALER ATTITUDES

 AGOURA HILLS, Calif., Jan. 12 /PRNewswire/ -- J.D. Power and Associates 1992 Dealer Attitude Study(SM) reflects the fact that the slight improvement in profit margins in 1992 at the retail level of the automotive industry, combined with the disappearance of nearly 2,000 franchised new car and truck dealership outlets in the past five years, has not improved the business relationships between the retailers and their manufacturers. In addition, dealers have now concluded that there are just too many dealers remaining for the thin profit margins they see.
 Sixty percent of the dealership owners who responded to J.D. Power and Associates' study rate the financial investment as retailers as "fair" or "poor." In addition, the nation's new vehicle retailers are evenly divided between positive and negative judgments about their relationship with franchisors.
 "In past economic recoveries, an improvement in profit margins coupled with fewer same-make competitors would result in improved dealer attitudes toward their business relationship with those companies who supply the new cars, trucks, parts and accessories the retailers sell," commented J. Ferron, senior partner at J.D. Power and Associates. "In 1992," he continued, "the relationship as measured by the study's important Business Terms factor relating to overall dealer satisfaction took an alarming drop in 3 out of every 4 distribution channels analyzed."
 Saturn, General Motors Corp.'s newest division, displaced last year's leader in the overall J.D. Power and Associates Dealer Satisfaction Index (DSI) by exceeding the ratings given by Lexus dealers, those with franchises from Toyota motor Sales luxury car division. Of the four factors that comprise the DSI, Saturn set new performance records in two. Those factors, the Business Terms and the Manufacturer's Sales Support, together explain 59 percent of the relative satisfaction differences between the distribution channels as measured by their own dealers. Rounding out the top three franchises was Infiniti, the luxury division of Nissan Motor Sales. All of the top three distribution channels are new in the past three years and have a relatively low number of retail outlets.
 While Asian franchises as a whole lead both domestic and European channels in overall DSI, it was the improvement in domestic franchise holder ratings of their own financial investment opportunities that helped account for the small, industry-wide increase in confidence. Saturn, Ford, Buick and Jeep dealers joined Lexus, Toyota, Honda, Mazda, BMW, Mercedes-Benz, Acura, and Infiniti as leaders in "excellent" ratings from their own dealers regarding the perceived financial investment opportunities of the franchise.
 The proportion of the retail outlet owners that consider the location of same-make dealers to be "very" or "somewhat unacceptable" has risen to 36 percent, the highest level in five years since that question was added to the J.D. Power and Associates study. Attrition of retail outlets and consolidation of ownership of the remaining outlets mean that the number of dealership owners was only 15,374 in 1992.
 "When all the data was analyzed it became clear that a retail revolution is taking place and that manufacturers can no longer command the way the distribution system should work. The remaining retailer owner who is closest to the customer now expects more from their manufacturing partners just as the final customers are demanding more from the dealership showrooms and service departments," commented Ferron. Ferron concluded by saying, "Hence, those manufacturers who do not improve the services and products they provide to their retailers will lose the dealer enthusiasm needed to win the retail shelf space' with the surviving retail owners."
 The annual survey of the nation's new car and truck dealership owners revealed 17 distribution channels which placed at or above the industry average DSI of 99, which in 1986 equaled 100 index points. Those franchises are: Saturn (139), Lexus (137), Infiniti (122), Toyota (113), Honda (108), Saab (107), Ford and Mercedes-Benz tied (106), Acura and Lincoln/Mercury tied (104), BMW (103), Mazda and Volvo tied (102), Buick (101) and Dodge, Chrysler/Plymouth and Suzuki tied (99). Sixteen franchises performed below industry average according to the opinions of their own dealers.
 J.D. Power and Associates is an international marketing information firm with headquarters in Agoura Hills. The firm has offices in Torrance, Calif.; Detroit; Westport, Conn. and Tokyo. The firm is best known for its marketing information and consulting in the areas of consumer opinion and customer satisfaction.
 -0- 1/12/93
 /CONTACT: Patricia A. Patano or Jim Olson of J.D. Power and Associates, 818-889-6330/


CO: J.D. Power and Associates ST: California IN: AUT SU:

JB-LS -- LA009 -- 3833 01/12/93 08:31 EST
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Date:Jan 12, 1993
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