Chinese carmakers narrow quality gap with global brands

November 1, 2013 Leave a comment

Chinese carmakers narrow quality gap with global brands

11:53am EDT

By Samuel Shen and Norihiko Shirouzu

SHANGHAI (Reuters) – China’s state-owned GAC Motor scored above average in a closely watched quality survey, as home-grown brands narrowed the gap with the foreign marques that dominate the world’s biggest car market. GAC Motor, which sells cars under its own brand Trumpchi, had 97 problems per 100 newly sold vehicles in a survey published on Thursday by market-research firm JD Power & Associates.That was better than the average 119 problems and beat global names such as General Motors Co’s (GM.N:Quote, Profile, Research, Stock Buzz) Buick and Chevrolet, Ford (F.N: Quote, Profile, Research, Stock Buzz), Nissan (7201.T: Quote, Profile, Research, Stock Buzz) and Honda (7276.T: Quote, Profile, Research, Stock Buzz).

A lower score indicates higher quality, with a score over 100 showing multiple problems per vehicle.

Three other Chinese brands — Venucia, Roewe and Luxgen, also performed better than the industry average, compared with none last year when JD Power started ranking domestic brands in the survey.

Venucia is a brand developed by a Chinese venture of Japan’s Nissan Motor Co for the local market, while Roewe is a brand SAIC Motor Corp (600104.SS: Quote, Profile, Research, Stock Buzz) started with technologies the state-owned Chinese carmaker purchased from Britain’s Rover.

“Chinese domestic brands achieve tremendous improvement in vehicle quality in 2013,” Mei Songlin, J.D Power’s China vice president said in a statement.

Chinese automakers including SAIC Motor Corp, GAC Motor and FAW Car Co Ltd (000800.SZ: Quote, Profile,Research, Stock Buzz) have stepped up efforts to develop their own brands using technologies and skills they have learned or bought from foreign companies, which can only operate in China through joint ventures.

But despite these efforts, foreign brands still grabbed the top spots in the survey – Toyota’s (7203.T: Quote,Profile, Research, Stock Buzz) Lexus and Daimler’s (DAIGn.DE: Quote, Profile, Research, Stock Buzz) Mercedes-Benz (DAIGn.DE: Quote, Profile, Research, Stock Buzz) tied for the highest quality, with 52 problems per 100 cars, followed by Subaru, made by Fuji Heavy Industries Ltd (7270.T: Quote, Profile,Research, Stock Buzz), Volkswagen (VOWG_p.DE: Quote, Profile, Research, Stock Buzz) and BMW (BMWG.DE: Quote, Profile, Research, Stock Buzz).

The survey, which was initiated 14 years ago, monitors how cars perform in the first two to six months of ownership by asking randomly selected buyers.

It measures the number of problems, such as design-related issues, defects and malfunctions that buyers identify, per 100 vehicles.

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