Why Do Americans Buy Undependable Cars?

Cars on a lot
Cars on a lot

The top-selling cars in the U.S. in January came from General Motors Co. (NYSE: GM) with total sales of about 195,000 vehicles, Ford Motor Co. (NYSE: F) with sales of about 166,000, Toyota Motor Corp. (NYSE: TM) with sales of about 158,000, and Chrysler Group LLC with sales of about 118,000. No other automaker sold more than 100,000 vehicles in the month.

J.D. Power and Associates, a subsidiary of The McGraw-Hill Companies (NYSE: MHP), today released its latest data on vehicle dependability. The study is based on a survey of original owners of three-year-old vehicles (that is, models introduced in 2010) and dependability scores are based on the number of problems per 100 vehicles.

Chrysler, Jeep, and Dodge nameplates are among the least dependable choices available. The Chrysler badge itself scores 153 problems per 100 vehicles (153 PP100), while Jeep scores 178 PP100 and Dodge scores 190 PP100. Only Land Rover, with a score of 220 PP100, is worse.

Yet Americans bought 43,227 Dodge vehicles and 20,696 Chrysler vehicles in January, up 37% and 18%, respectively, from January 2012. Jeep sales fell 4% year-over-year to 30,318. Sales of the company's Ram pickups rose 14% to 20,987 units, and with a dependability score of 122 PP100, this nameplate is among the top ten in the J.D. Power survey.

Another nameplate with a low dependability rating is Volkswagen, which saw sales rise 6.6% year-over-year in January to 29,018. The VW's dependability rating is a terrible 174 PP100.

The J.D. Power industry average is 126 PP100, and 12 nameplates score better than that while 20 score worse. Yet Americans purchased more than half of the total 1.04 million vehicles sold in January from among the nameplates that scored worse than average. Worse, the three low-ranking Chrysler nameplates and Volkswagen accounted for more than 123,000 car sales in January, or about one in every eight cars sold.

With all the information available to U.S. consumers today, it hardly seems possible that sales of the least dependable cars on the road are actually increasing. You can't make this stuff up.

Filed under: 24/7 Wall St. Wire, Autos, Research Tagged: F, featured, GM, MHP, TM