STUDY_AUTO

2013 U.S. Consumer Financing Satisfaction Study Results

By: Jeff Youngs, 11/27/2013
Customer satisfaction with the borrowing experience is higher when lenders provide clear onboarding information and make it easy for auto loan customers to self-manage their accounts, according to the just-published J.D. Power 2013 U.S. Consumer Financing Satisfaction Study.SM Additionally, satisfaction with the onboarding process sets the stage for a satisfactory experience with the servicing of the loan throughout the duration of the financing. The study measures customer satisfaction in three key factors of the new-vehicle financing experience: billing and payment process; website; and phone contact. The study is conducted across two types of vehicle segments: luxury and mass market.

Overall satisfaction among automotive financing customers in the luxury segment is 835 (on a 1,000-point scale), and is 820 among those in the mass market segment. Among highly satisfied customers (overall satisfaction scores of 800 and above), 95% say they're likely to choose the same lender for future transactions.

Information is Key to Satisfaction
Overall satisfaction is higher for captive lenders--lenders owned by the vehicle manufacturer--than for non-captive lenders. Luxury segment captive lenders score 851, compared with 793 for non-captive lenders. Mass market segment captive lenders score 836, compared with 805 for non-captive lenders.

Satisfaction among auto loan customers is higher among those who indicate they completely understand their lender's onboarding information than among those who indicate the information was unclear--131 points higher in the luxury segment and 115 points higher in the mass market segment. Providing tools for customers to self-manage their account--particularly in setting up automated payments--increases satisfaction 157 points in the luxury segment and 152 points in the mass market segment.

The study finds that dealer recommendations remain the most critical driver of lender choice. Among luxury vehicle buyers, 48% indicate that they chose their lender based on dealer recommendations; 50% of mass market vehicle buyers indicate the same. Nearly one-fourth (24%) of luxury customers, and 32% of mass market customers, indicate having considered multiple lenders before selecting their finance provider.

"When you consider that most consumers finance indirectly with a lender and the only face-to-face contact a lender may have with a customer is at the point of the vehicle purchase or lease with the finance manager at the dealership, first impressions really matter," said Mike Buckingham, senior director of the automotive finance practice at J.D. Power. "It's extremely important for lenders to get the servicing experience right from the start by providing a superior welcome letter and first billing statement that are rich with information to begin the onboarding process. This provides a solid foundation for continued customer satisfaction."

Lincoln, Kia Captive Lenders Rank Highest
Among lenders of luxury vehicles, Lincoln Automotive Financial Services ranks highest, with a score of 875, and performs well in all factors. BMW Financial Services ranks second at 872, followed by Lexus Financial Services with 860. Both Lincoln Automotive Financial Services and BMW Financial Services receive an overall rating of 5 Power Circles in the JDPower.com Power Circle RatingsTM for the lending experience they provide.

Kia Motors Finance ranks highest in the mass market segment, with a score of 851, and performs well in billing and payment process and website. Ranking second is Volkswagen Credit, with 849, followed Hyundai Motor Finance with 848. Interestingly, each of the six highest-ranked mass market auto finance lenders receives an overall rating of 5 Power Circles (Ford Credit, Toyota Financial Services, and Honda Financial Services).

Consumer Tips
Based on the 2013 U.S. Consumer Financing Satisfaction Study, J.D. Power offers the following consumer tips:
  • While customers appear to prefer the services of a captive lender, it may benefit you to compare that lender's terms and servicing capabilities with other, non-captive lenders.
  • When considering several different vehicle manufacturers, compare their lenders as well as their vehicles.
  • Ask your salesperson or finance manager to walk you through the lending agreement, and to point you to areas that are frequently misunderstood.

About The Study
The 2013 U.S. Consumer Financing Satisfaction Study is based on responses from 12,741 new-vehicle purchasers or lessees who completed a vehicle loan or lease. The study includes new vehicles financed in model years 2012 and 2013. The study was fielded between September and October 2013.

Additional Research:

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