AAH #734 – The Most Reliable Cars You Can Buy

Speaker 1: O'll online.

Speaker 2: After Hours is brought to you by bridge Stone Tires Solutions for your Journey.

Speaker 3: Hi, everybody, welcome to Autulne after Hours. I'm going to

have an interesting conversation today what's the most reliable cars that you can buy? And we're going to get into

that because we've got Jason Norton from JD Power who's going to help us dig into all the latest data that they they've got from their vehicle dependability study. And

we've got Jackie Charnigha from the Detroit Free Press joining us too. And Jackie, great to have you here, and Jason.

Speaker 4: You too, thank you. Yeah.

Speaker 3: But so first off, maybe people don't know they hear a lot of JD Power acronyms IQs Initial Quality Survey VDS, Vehicle Dependability Survey or study. So explain VDS so.

Speaker 5: Perfect, Thanks for the segue and thanks for having me on today. So our initial quality is measuring ninety days

of ownership, where our Vehicle Dependability study is measuring three years of ownership.

Speaker 4: So at JD Power we have that ability to really track that full.

Speaker 5: Ownership experience through our various studies that we have and the latest one of course that just came out in February was our Vehicle Dependability Study.

Speaker 3: I like the VDS because you know, the IQs measures quality after ninety days of ownership. Right, all right, we're

being joined by David Kylie. David, come on in, man,

have a seat, Let's put a microphone on you. Sean

can help you on that. So just below everybody knows

David Kylie's from wards and we're talking Vehicle Dependability Study.

So anyway, as I was saying, I like measuring after three years of ownership because I like to say, after ninety days, come on, everything.

Speaker 4: Should work exactly you would hope.

Speaker 5: So anyway, but yeah, obviously our data shows there's some issues with those ninety days of ownership vehicles as well.

But yeah, with three years of ownership, you really start to see where those broken out working areas, Where are those different areas where you're having software issues that are continuous throughout that ownership period. So you know, really diving

deep into each of those issues is what we're able to do. And of course, our Vehicle Dependability Study, just

like all of our studies, is true voice of the customers, So we're asking real customers, real owners of these vehicles.

What are these different issues, And we measure nine different categories within our study that really looks at infotainment, exterior, driving, assistance, all these different powertrain aspects, so really diving into that full vehicle experience that they're having at that three years.

Speaker 6: And i't mean to overreact to infotainment, but that one's the worst in my opinion.

Speaker 5: It is the worst scoring category in our study as well, So it's most problematic for many customers with the one you.

Speaker 6: Like, Jackie, Well, I have a cell phone and it does a lot of things, and it does a lot of things better than my vehicle does. And I don't

think there's too much crossover that needs to happen between what a vehicle can do and what my phone can do.

I'm supposed to be when I'm behind the wheel as far as I know driving, and it's just a huge distraction.

Speaker 5: Yeah, that bringing your own device into the vehicle is definitely what's really problematic for a lot of customers. So connectivity,

we were talking about this before the show. You know

that Bluetooth pairing is really one of the top problems.

Android Auto Apple car play experience is the top problem in the industry.

Speaker 4: So all these.

Speaker 5: Different device related activities that the customers having. Even oem

app is becoming more and more problematic in the industry.

So definitely that device customers just want to say, hey, this is my life. I want to bring it into

my vehicle and continue my experience.

Speaker 1: So well to your point, Jen, measuring how people feel about a new telecommunications and system that there maybe or unfamiliar with in the first ninety days, I have to believe that the complaints hit the ceiling, whereas over three years you kind of figure out, you know, how different things work. But the larger problem, I'd be curious if

you agree. I heard a great term. I'm not going

to take credit for it. Men, you bloat. I think

that it's the great one of the great descriptors of you know, when there's just too much stuff that you have to cycle through to do what you want. But

I just I love that term. I feel like I

want to make it the permanent name of a column.

Speaker 5: And it is true, right, So a lot of customers there's a lot of new features, so oh yeah, of course want to put these new features into the head unit.

Let customers find them surprise and delight as features is what they know, we like to say, but it also becomes very overwhelming. So and especially when you're getting in

and out of the vehicle. If I just go get

a cup of coffee and I get back in my vehicle, now I got to search all the way back through my menu to find out where I was in my last place that took me so.

Speaker 4: Long to find before. So a lot of that is

coming through in that four years of ownership.

Speaker 3: Give me a one check and then then you Jeki, what is it? I mean pairing, pairing the phone to

a car. It's been around for years and years and

years now. Some automakers really really good at it. You know,

I'll cite the Hondai group. Houndai Kiya seem to be good,

Toyota seems to be really good. Others. You know, I'll

try to pair the phone and I'll start, you know, the search on my phone, and you know, just certain nothing happened, so I stop that. Then I start the

search with the car, and then I do my phone.

Then everything's fine, and then on other cars it's exact opposite way. And why have they not figured this out

by now?

Speaker 4: You know, everyone is working really hard with it.

Speaker 5: But as we know, technology gets continuously updating on cell phones, so things are happening faster on cell phones, and maybe part.

Speaker 3: Of it's the phone problem. I don't know.

Speaker 5: I don't know if you can necessarily attribute it to the phone, but maybe it's not the software, the OEM keeping up with the phone software, so it's making that compatibility issue. Also, we see a lot of issues when

there's multiple phones. So if the user has two phones,

maybe they connect a work phone or they have a you know, significant other's phone in the vehicle as well.

So that priority of phones is where we see a lot of issues. So you know, if your partner moves

your vehicle, all of a sudden, they're the number one vehicle or the number one phone within the vehicle and you get in the vehicle and it's you can't find it.

Speaker 1: I'm smiling and laughing because we have this problem in our house where my partner it's primarily her car, but both of our phones are connected. There's history there, but

it's like, you know, I'll actually wire mine in, but it's reading hers, which is on Bluetooth, and now I have to go muck around with something else. But to

your point on Hyundai, I just want to say over a long period of time. I have a lot of

experience with Hyundai Kia tech centered stuff. They do some

of the best research, like beta testing, seeing what the consumer wants and all of that. I worked closely with

another company among the Detroit Three. They're tear bullet this.

They don't bet a test, they don't do real life consumer How is this going to work for the constrer?

They say they do, believe me, it's it's not so.

I think culture is actually culture at different companies is one of the separators on how good these things are over time.

Speaker 6: I hope I don't reveal which Detroit three member with my anecdote that is completely unrelated.

Speaker 7: But I had a similar experience.

Speaker 6: You mentioned the phrase surprise and delight between these features.

I mine was more of a surprise and dismay because it was I was trying to help my father with his jeep Wrangler and he wanted to know how to use the map feature, and it took us about ninety days to realize there was no map feature. They just

wanted it to come from your phone. Now, I feel

like that's an interesting point what automakers feel they have to build themselves versus what the phone comes with already, and what are customers more likely to use and what's a more seamless experience. But nobody told us that his

phone is is vehicle no longer had a map, and that became an issue, especially if he's relying on that to not even determine where his vehicle is, but what direction it's facing it in some spaces.

Speaker 5: Yeah, yeah, No, there's a challenge right now in the industry as a whole. I think everyone's aware of it,

just figuring out how to implement new technology pieces in the vehicle, how to make those customer experiences really you know, move on past you know what they're able to update or not update within these in vehicle systems. So, you know,

I think that's just the push and pull what we're seeing in the industry right now. But you know, I

don't know if anyone really has that solved yet. I

think there's a lot of different viewpoints and the ways that each different OEM is trying to take. But you know,

right now, I don't know if there's a good direction.

Speaker 1: You know, surprise and the light can go, you should go well beyond the telecommunications and the interface, right So words, right, we're doing. We're evaluating our ten best user interface and

interior designs and some of the things that I encourage us to look for. One of my favorite surprise and delights.

I asked the OEM when they first introduced it.

Speaker 3: How much did this cost?

Speaker 1: Because it's great? And they said, and they said, didn't

cost anything. It was just a software thing. And I'll

tell you what it was. And this is the kind

of thing that companies overlook. Nissan when they first introduced this, uh,

they were one of the first ones, if not the first one, to tell you which tire was low after everybody had to do the tread act tire pressure monitors which one and then when you get out to put some air in the tire, the horn beeps when it reaches optimal PSI And I just thought, how much did that cost? Because it's wonderful? Yeah? Nothing, it was just software.

Speaker 4: February.

Speaker 3: Yeah.

Speaker 1: I mean it's those simple things. I don't understand why

every company it's not a patent thing, why every company hasn't has an copied it.

Speaker 3: So, you know, it's interesting we're talking about all this connectivity and infotainment and all that because years ago on the vehicle dependability survey. It would have been like oil

leaks on the garage floor. It would have been a

rattle in the trunk, it would have been a transmission that crapped out. So has the industry fixed those old problems.

Speaker 5: Now those old problems are still prevalent as well new problems that are overtaking those problems. So when we look

at our industry as a whole or our study as a whole, we group things into problem aggregates, so we can look at things like broken outworking, poor performance, so that's more connectivity things like that, but we also look at software defects. Software defects this year at a twenty

percent increase year over year, so it was the highest increased percentage wise by any of the problem aggregates what we have. But when we look at the top problem overall,

it's still the broken out working, which this year made over a quarter of the problems of the studies. So

still very problematic across the industry, but we are seeing that software defect related areas, in enfotainment related areas really taking over some of those issues.

Speaker 1: Would question about to study itself, would it be too expensive or too problematic to extend it even longer to like five years instead three.

Speaker 4: That's a great point.

Speaker 5: I mean, that's a big topic within our organization right now, as well as maybe understanding these longer term ownership periods.

We know that people are holding out to vehicles longer and longer.

Speaker 3: If you look at pastcar, it's fourteen years. I mean

combined with trucks, it's like twelve point four or whatever.

Speaker 1: And by the way, most bumper to bumper warranties, I don't know, I'd have to look at all every automaker, but so many of them end at thirty six thousand miles, three years, thirty six. But there's not that much stuff

that's going to go wrong. But you know, the seventeen

minutes after my warranty expired, I had a part in my car break. It was like a forty buck part.

It costs like almost three thousand dollars to replace because they had to pull the whole dashboard. None of it

was covered.

Speaker 5: Yeah, we know there is a big focus I say our organization, but our organization also you know, we're working with a lot of OEMs.

Speaker 4: OEMs.

Speaker 5: That's a big point of topic for them too, is understanding these longer term ownership periods and what maybe they're able to do to implement help these customers out during those periods of time.

Speaker 6: For sure, I had a question that I sort of want to ask the group because I've recently returned to automotive journalism and I haven't been in the game for a while, but I wanted to kind of go back to cell phones a little bit. So we talk about

how technology changes quickly, and it seems like cell phones are the most important tool that we have that's changing.

And from my experiences, we used to be able to tell fashion like you know, an image could tell you what decade and what was happening culturally or politically, and you know, I would be watching a television program and I'd see a Ford Flex and I knew it was two thousand and nine. But when it comes to what

is the difference between the newest, latest vehicles and what makes a new car new feel new from a customer perspective and is worth the price tag, I want to know what that means anymore. It used to be cup holders,

this car is twelve cup holders whatever, And when it's just you know, you can only tell something's a period piece based on if it's a flip phone or a smartphone.

What is the distinguishing factor with the vehicles. I've had

a chance to talk to some designers and you know, even Cadillact.

Speaker 7: Their concept car just has the DeLorean doors.

Speaker 6: And we always use the jet sins as a touch point as what the future is going to be like.

But from what customers think when they get into a new vehicle, what is what is the thing that makes it new? Because we're talking to Edmunds, talking to Cocks

and other people, they would always say, if you want a new car that you can afford, your new car is three years old, get that one instead. So what

is what is your take doing the study and you guys from covering this industry, what do you guys think?

Speaker 4: Maybe I'll loll you guys go first number one.

Speaker 3: I think it's a great question. Here, great question, and

I would say it kind of depends on the vehicle or vehicle segment. So like if you're talking Mustang Corvette, well,

I you know the product develop guys, I say, guys, you know gals too, you know guys yea, yeah, they got a laser like focus. Boy, do they understand what

that customer wants? Probably full size pickup buyers too. You

know exactly what those people want. When you get into

other let's say, mid market family sedans. Ooh, that gets

really hard because you're trying to appeal to such a broad base of owners that have all kinds of different needs and wants, you know, demographic, psychographic. So yeah, I

would say styling still counts both inside and outside. And

then you know, having some kind of cool feature and I can't think of one right off the top of my head. Well I'll say something like four wheels steering.

That's where you bring your friends and neighbors over and go look at this thing. Look at a crab walk,

I mean a gog at what it can do, even though you're never ever gonna really use it unless you're a hardcore off roader. So I mean that's kind of

my reaction to your question, but it's a hell of a good question.

Speaker 1: Well, you take a look at the Rev four, for example, the Toyda Rev four, which was the best selling car last year. I think that that is an example of

a car that, in terms of the guts, the platform and things like that, it should just be continuous improvement.

The day is you and I have been around long enough we remember when I'm trying.

Speaker 3: To remember, by the way David's indicating towards me, you and I have been around a long time.

Speaker 1: That we remember going to the Detroit Auto Show when Chrysler or CEO Bobby wanted to make a point about how everything had changed in one model to the next.

And I can't remember which model it was, but he threw a bag of parts and bulk and he said, he said, this is the only thing that carried over from last generation to this generation. Wanted to emphasize, this

is all new, you know what. People buying Revforce don't

care if the thing is all new. They care about

continuous improvement and maybe a tweak on the external styling to you know, to mirror kind of current fashion trends or you know, something like that. But man, they just

people buying rev fors and cameras and they just want to see that it's it's it feels new, it's smarter than the last one I bought, you know, well pretty much.

Speaker 3: And to get back to our subject matter expert here, they want dependability. I mean, that's why so many people

buy Toyota's. Toyota always does very well in the survey.

But this year General Motors, my jaw dropped when I saw how well the GM brands.

Speaker 4: Did in the General Motors had a great year this year.

Speaker 5: So they had twenty award eligible models, fifteen of them actually were in the top three within their individual segments, so really their whole portfolio was within that top three within those individual segments. Toyota still very very strong though,

I mean when you look at them and in General Motors, they each received six segment awards. But the number one

overall nameplate this year was Lexis, so really moving up.

Number one mass market brand this year was Buick, so that was a great, you know, great improvement for them.

Toyota actually did fall to that number two when it comes to mass market overall. But when we look at

all those different pieces of what these companies are doing, it's really just focusing on those customer needs and trying to improve their products. Right, So go back to your question,

you know what is the biggest thing, and a lot of it is coming down to functionality making things easier to operate for customers. So we know technology maybe not

making that point, but that's the point of technology is to make things easier on the customer. But you know,

there is still a bridge that they're trying to gap right now for that. But you know, overall, I think

it's a lot of that is coming down to functional behavior.

Speaker 4: So you know Wrap four.

Speaker 5: You know that's more utilitarian, right, That's that's someone who wants things to function right. I want my space to

be right, I want my cup holders to work. I

want to be able to have good storage. All those

different aspects, you know, does create this new sense if I'm able to make things just that little bit better for the customer. So that's when I was really focused on.

But of course quality, quality, quality is what we're.

Speaker 3: You know, the other thing that jumps out at me, GM and Toyota, the biggest car companies in the US market, both of them above average. When you're that big and well,

i'll put the two together. When you got the number

one and number two, it's hard to be above average, right, I mean, it's just from a number standpoint, What is it about them that they did so well?

Speaker 5: When you look at these brands, it's really designing in quality.

So we have the ability to separate design which we consider difficult to use, difficult to operate sides of things versus a broken or difficult malfunction side of things. So

when we look at those, they're at the top of the ring charts when it comes to that design aspect.

So again, making things easy to work or as best as they can for their customers to make things these it works. So designing and quality really helps elevate them.

So over the three years of ownership, if there is a defect or malfunction, you don't have to worry about the design of things. You can actually just chase down

what's being broken and how to fix that over that ownership period.

Speaker 6: But if it's in the center of the vehicle and you've got to rip the whole thing apart, yeah.

Speaker 1: I think. I think GM culturally has gone through a

pretty impressive transition of improving design. I think that their

EV improving quality. I think their EV stuff is great

and just a little thing which I've cited in coach.

They're also become the most efficient manufacturing manufacturer in the world when you look at employees per vehicle or vehicles per employee. But I did this breakdown and it's really impressive.

You know, they continually you don't see a massive restructuring layoff of something like that at JAM what they did, They do it all the time. They keep they keep

rationalizing and optimizing their workforce to what they need and where the market's going. Hey, is that hard on people

who wind up having to shift?

Speaker 3: Absolutely, But what you're saying is that they're sounding more and more like Toyota.

Speaker 1: Would they it's I have to do a more in depth analysis of the numbers. But if because Toyota and

GM have no certain non automotive operations and employees, but if you look at the number of vehicles for employee ratio, GM kills the competition, it's like up around thirty six or thirty seven vehicles per employee. Toyota is in the

if you just do it that way, Toyota's in the upper twenties. But I think almost nobody else is in

the thirties, and so GM has just done a really good job. I think of changing their culture under Mary Beara,

you know, and Mark Royce and some of the other people.

I know that you had a very illustrious guest late last year, former GM executive who we all love, you know, who was bashing the culture GM. I kind of feel

like that's at a date, you know, the culture that I'll just say, is it Bob Loah? I love we

all love Bob, but I feel like the description of GM's culture by Bob is at a date, you know, for what's been happening the last five to ten years.

Speaker 6: Can you contextualize that that entire phenomenon? So is it

that when you're trimming the fat of your employee payroll you have more for R and D, you can fixate more on the vehicles themselves.

Speaker 1: There's an enterprise cost to having too many people. I mean,

I've worked at a couple of you know, closely, not as an employee of the OEM, but as a as a supplier. And when you when you keep after the

headcount and you don't let headcount that isn't optimal to the direction you're going. When you keep attacking that, it

reduces the enterprise cost of wasted time and time that is just misspent in the wrong directions.

Speaker 6: But is the best way to do that, say, have every employee justify what they did the week before.

Speaker 1: I don't think I don't know what the system is at General Motors. But you know, I wasn't going to

talk politics, but I can't. But I also don't think

that that approach that we're seeing in the news is very useful or productive to employees or culture either. I mean,

I just think GM is doing a much more professional, systematic, deliberate, consistent level that because we're not saying, oh my god, we have ten thousand too many employees, you know what.

I haven't seen that in some time from GM. I've

just really impressed the way of the way Mary Barra has changed the culture over the last ten years.

Speaker 6: I think I'm very interested, obviously in where that culture is going. And yes, I'm the GM reporter for the

Free Press, so I'm more interested than I am and on anything else. But the culture has to be fixated

on a goal and a mission, and that's something that I'm very eager to figure out. So in terms of

what it makes a vehicle that we drive today, safe, dependable, useful, safe being the first thing, because obviously GM talks a lot about zero emissions, zero accidents, everything that they're working towards.

Speaker 7: But when I ask that question about what.

Speaker 6: Makes a vehicle new or what are the features that it should have, I'm seeing, in my experience limited, though it may be more and more conversations around what could a vehicle be other than a fan you drive? And

that's something I'd like to ask the group as well, in terms of your ideal vehicle. And a lot of

people I've discussed this with at a GM obviously in the Assistant Driver program and autonomy. We all saw what

happened with CRUs and that's another point of consolidating, getting experts into this system they've already had and getting rid of some employees that might not be doing what they needed to do. But then you have a vehicle that

is a living room, a kitchen, a sensory deprivation tank, a spa, Like, what is a vehicle going to be?

And is all the technology we have going to assist the driver for now until it takes over completely.

Speaker 7: So I'd like to ask that as well.

Speaker 6: What a car should be and what we're not trying to make it fly anymore. It looks like we're just

trying to make it Some people are I want to interview them, just make it think for itself.

Speaker 3: Look, it depends on the individual. What does an individual

want out of their car? You know, if I'm buying

I go back to the Corvette, the Mustang, I'll throw in Porsche BMWMS, and the list goes on and on.

The hell, if I want the car to drive me, I'm buying that car to drive it. But you know,

enthusiasts comprise roughly ten percent of the market. Nine would

love to have the SPA, the deprivation tank, the living room, at the kitchen, and have this car do everything for them in their daily community. You know, who wants to

drive in stop and go traffic. I've never met anybody

that wants to drive and stop and go traffic, but for millions of people who work that everyday reality. So yeah,

if I can push a button and it goes fully autonomous, woohoo, I'm all for it.

Speaker 1: Yes, for that driving situation. Then I want to be

able to turn it off, you know when I want to when I want to take control of the vehicle.

And I think that's where we are. It's funny when

you said the SPA thing, the car that I immediately think of is is the Lincoln you know that's made in Japan. And you got the Aroma China, China, Sorry sorry, Nautilust,

the and and and the Aroma therapy and I'm I'm sitting there and this whole there's this whole phenomenon that's being explained to me about people who want to pull into their driveways and stay in their cars. And I

just thought, how many people is this depends? Well, so

if somebody told me this is where the origin of the car is, and in China, it's that, it's where we're it's it's it's much more of a thing because people have smaller residences. They might have, you know, several kids,

and and this is more of a thing now. I

happen to be driving with a friend of mine who and she said when when we tested the vehicle, She's like, oh, I'm all over this, and you know, and I thought, maybe, I don't know, is there a gender split in all of that? Because when I get home in my driveway,

you know, I got a house that's comfortable, I guess things I want to do, you know, I just get out of the car and I go in my house.

Speaker 6: You don't want to do them in the car, watch television, take a zoom in my driveway.

Speaker 1: No, I don't want to do any of that. Occasionally

I've gone into the car for a quiet place to record my podcast intro. But but to your point, there's a.

There's a race among some automakers to put a lot of do dads and fancy stuff and to be able to say it's a lifestyle vehicle. That's my favorite. I've

been hearing that all my career. It's a lifestyle. Well,

what is it a lifestyle exactly? So it's it's but

we're talking about depending ability. That's the best thing they

can do. Design quality, design quality in so it doesn't

cost me, you know, two and a half grand to replace a forty buck part. You know, do these things

make it so the horn beeps when I reach out the mole. There's like the two hundred smart things. They

could design it to every car that everybody would love, but they don't want to copy one another. There's competition

internally about whose idea gets put up. That's the stuff

that gets in the way of quality.

Speaker 6: I have a question about especially cost, because in terms of dependability and the desirability of certain different lifestyles in your vehicle. Can you describe the split between luxury buyers

and is there like a tax bracket breakdown of people's responses.

Speaker 5: What we're seeing, really the big divergence right now is with technology.

Speaker 4: Again, going back to this.

Speaker 5: Where we see in the premium models this year, everybody remain pretty flat year over year, So it was two hundred nine problems about with premium vehicles where we saw a big uptick with mass market vehicles. A lot of

that was because of integration of new mpertainment systems, new driving assistant features coming into those mass market vehicles, where they actually saw degradation of sixteen problems per one hundred year over year, So huge shift, and that's really what we saw drive the industry up as a whole was come from those mass markets. So maybe these premium buyers

are starting to overcome some of these opticles, maybe they're getting used to some of these technology features within their vehicle, and now they're shifting into mass market vehicles, so we're starting to see that.

Speaker 3: You know, the split that I found fascinating was between electric plug in hybrid hybrid and ice right and doves showed a big improvement, but you found that peavs had the biggest problem.

Speaker 4: Exactly.

Speaker 5: Yeah, we briefly touched on it a little bit before this before going live, but a lot of it is like you're almost getting a little bit of both negative worlds, so you're getting some of those problems that you're seeing within the industry for the ice side of it, we're also getting those top problems that you're seeing from the BEV side of it. So you know, overcoming those obstacles

is difficult. Where a lot of focus right now for

the auto industry has been on all electric vehicles, so addressing those issues. But we know PABs are still going

to be very prevalent moving forward, so I think the industry will start tackling those as well.

Speaker 3: But a lot of it, we found that hybrids were the best of all. Yeah, which you know, because hybrids

are not exactly simple, you know, compared to ice or diesel, pure ice or pure diesel, and yet hybrid scored better than pure ice or diesel. Well, how do you read that?

Speaker 5: You know, it was an interesting finding, of course, But I think a lot of that is coming down to, Okay, now I just have this vehicle that it has longer range, I don't really have to mess with going to the electric charging ports and different things like that. So it

has become easier for a lot of customers just not to deal with all these issues that they want to have from the from the ice side of it. But

they're getting now within the hybrid, so I think a lot of it is driven by reducing some of those issues when it comes to plugging in the vehicle, and.

Speaker 3: Jason were getting down to the end of the segment.

But who else did well? If I remember off the

top of my head, Mazda, Honda, Worsha.

Speaker 5: We're all, you know, really towards the time, they all had really good years this year. I mean, there was

big improvements in the industry for some models, of course, but you're really dominated by the GM and the Toyotas this year, so you think twelve awards just from those two alone. Maza Nissan had a couple of awards as well,

so the Morono and the Kicks had good final out right, But there were some good stories in the models that were able to call. One of the big stories this

year were the model launches. So there was twenty seven

new model launches this year within our study for twenty one model or twenty two model years. So you think

of that time during COVID there was chip shortages, there was disruption and production. So all these twenty seven models

that were launched, only four actually performed better than that segment average.

Speaker 4: So It just shows.

Speaker 5: That difficult time to launch a vehicle, especially with these new mpertainment systems, new driving assistant features in the vehicles as well. So a lot of problems across the industry

when it came to launching vehicles to be expected, though, So we saw within our ninety days of ownership at twenty two model your vehicles there was an eleven percent increase in problems as well, so you know, they got a little bit better. Three years of ownership is still

still problematic.

Speaker 3: Real good. We're gonna have to wrap this up, Jason,

thanks so much for coming on the show. Very interesting,

great good data there.

Speaker 4: Yeah for sure.

Speaker 5: Yeah, we got a lot of data points at JD Power.

So that's happy to be here.

Speaker 4: So thank you.

Speaker 3: We're going to take a quick commercial break and we'll be back talking about news in the industry this week.

Speaker 8: Knowing that a little rain won't slow down your day, that's what really matters. Reach down Toronto, quiet track tires,

confident control in wet conditions.

Speaker 4: Happy, It was nice to meet it you.

Speaker 3: Yeah, okay, here's some.

Speaker 1: Can see again.

Speaker 7: Yeah, nice meeting you.

Speaker 3: So we're back talking about news of the week, and uh, I guess you didn't want to get into politics. I

don't know how we can avoid it.

Speaker 1: That's fine. I didn't want to talk about politics in

the context of power.

Speaker 3: Yeah yeah, but you know, boy, you know, Tesla's just a spate of bad news sales creating around the world.

Stock price taking a huge, huge hit. And then yesterday

we saw President Trump out in the yard of the White House with a bunch of Tesla's.

Speaker 1: And uh, he apparently can't drive.

Speaker 3: Well, you know, Secret Service will not allow a president to drive.

Speaker 1: Except they let Biden and Obama do it.

Speaker 3: So yeah, just stay in a very controlled circumstance, right, But what'd you make of it? I mean, Elon needs

that kind of publicity.

Speaker 1: So I did a fairly deep dive on wards. That's

on the website today, not just rounding up what we know, but making the point there's a reason why CEOs of publicly traded companies don't get overtly involved in politics until maybe they're after they're they're outside of their role as a CEO. And there's an I cited you know, these

studies and about why you don't do it. You know,

you alienate a bunch of your consumers. You can alienate

a bunch of your employees. Nothing good comes of it

is basically what these studies have long said, which is why you know, if you look at FEC records, which I've done from time to time, you hardly ever see big you know, big donation trails of CEOs of publicly traded companies. They channeled their contributions through the company's pack.

And now because of the the way the Supreme Court ruled on this, they can give money to packs and their names won't be released and things like that. But

this is unprecedented in the US at least what Musk is doing.

Speaker 6: And always think of that word unprecedented. I've heard it

many times in the past five years.

Speaker 1: But I mean, and often you'd have a board if a CEO is doing things to hurt the company, you'd have a board react. Not the Desla board. I means

the board is is his friends and people he's richly rewarded.

They aren't going to tell very few people are going to tell Lelan Musk he shouldn't do something. You know,

we saw on the isaacs and book. There's a galaxy

of people it's telling him not to do the cyber truck the way he wanted to do it. It Matter

just went ahead and did it, and it's a fiasco.

They're going to have severe capacity problems next year and the year after because demand is just dropping off the cliff.

Speaker 3: Jackie, your read of the situation Trump with Musk on Primetime TV. I mean essentially selling cars.

Speaker 6: That's something that we've been asking the Detroit Three pretty frequently.

How do you feel about the potential for another competitor to have such close ties with the president, to have such obvious and overt perceived views of conflicts of interest?

And I think it kind of got to that point when the cuts were happening, and we saw what happened to NITSA in particular, and when I was trying to drill into which roles were lost at NITZA as several investigations into Tesla were ongoing. There was a very small

team at NITZA that focused specifically on advanced driver systems or autonomous vehicle tech. There was like six people on

this team. Three of them lost their jobs. So if

half of the team that's investigating the CEO of a company.

Speaker 7: Is lost, of sensibly due.

Speaker 6: To a project, he may or may not have been very much in charge of that.

Speaker 7: That's a little bit alarming.

Speaker 6: That's a little bit concerning what is church and state in this environment. And again I'm not as old as

I might actually.

Speaker 7: Be or appear to be.

Speaker 6: But in terms of just during the bankruptcy, obviously we've seen what happens when the Michigan contingent needs to go to Washington to plead their case, to make it clear what value the auto industry has to the economy and to not just our state, but several others that are dependent on vehicle manufacturing and supplying, and the entire nexus of building and selling vehicles and financing them is so much more complex than people realize. That there's a danger

to introducing an element when someone considers, well, this does seem complicated, what if we just got rid of it.

Disruption is one of my favorite words. And when they're like, well,

we got to disrupt this market, all I hear when they say that is there's a lot of money here, how can I get some? And it's just something that

it's very bizarre that dealers and auto people in the industry, when they're looking towards government, it's typically to say stay away from us, get out of our business unless it can help us make money, and which case, come remember us, please help us get involved, invest or protect. So I

think it's bizarre and unprecedented, though I have much less experience with which to say that. But again, I've been

covering the auto industry since twenty seventeen. I started on

the cusp of the Donald Trump presidency, and I've returned to the auto industry covering it on the cusp of the Donald Trump presidency. So it's been a fascinating bookmark.

Speaker 1: Well, I forget you or you John who used the phrase that we all know what it means conflict of interest.

I have covered Donald Trump since, you know, in one fashion or another, for a long time. He doesn't recognize

the concept. He literally doesn't recognize the concept of conflict

of interest. If it's in his interest, it's in everybody's interest.

And I'm not saying that to be you know, political, I'm saying that's a fact. I've watched and covered this

guy for decades. This is the way he is, and

it's a clear and obvious conflict of interest. What's happening

with him and Musk and the money that pours in and getting rid of you know what is the first thing he did. He wanted to get rid of inspector generals.

Speaker 9: The first thing he started to try to get rid of the whistleblowers whose job it is to blow the whistle on wait for.

Speaker 1: It, conflicts of interest and corruption and stuff that doesn't make sense, malfeasans. This is what the inspector generals do.

They were the first to go at least he's trying to get rid of them. It's, you know, the the

last the bastion of normal democracy are the courts that are trying to slow them up.

Speaker 3: Okay, back to automotive, not ofcessarily out of Pomis Day.

Speaker 4: We're not We're not.

Speaker 1: A field of automotive because we're a wash. The automotive

industry is a lot in what's going on.

Speaker 3: He also saw the EPA come back, and it's going to roll back a bunch of stuff. Now, I got

to say for automotive, there's a lot of stuff that I agree here. I think that the EPA standards says

they were set under the Biden administration were unattainable by the industry. They where it was a moonshot efforts that

was really going to hurt the industry. So I like

the fact that they're pairing back, but maybe it's going a little too far or I don't know, have you followed.

Speaker 1: This tracking well.

Speaker 6: A lot of the automakers like to say that they make changes and they don't need to be regulated, that they're trying to make their vehicles more sustainable, more fuel efficient, energy efficient, all of those things, and that these regulations either they're outdated or the people in charge don't even understand.

Speaker 7: The process that goes into them.

Speaker 6: So I think another important point is that vehicle product cycles aren't as truncated as people imagine them to be.

You know, a lot of the decisions that the automakers are making happened ten years ago, fifteen years ago, and they're coming to bear now. So we talk about how

flexible and durable the industry and is. There's not a

lot of flexibility when it comes to billions of dollars of investments and planned products and ideas. If they're trying

to push ahead with infrastructure, with deal education and consumer adoption of electric vehicles as a way to meet these standards, the changes in the standards, it's almost too little.

Speaker 7: Too late.

Speaker 6: So if the EPA is going too far, A lot of the people involved might think, well, we've come this far to make these changes already.

Speaker 7: We can wait three more years.

Speaker 6: Seven months or so, and then we'll see what happens.

But a lot of these if the auto industry can turn on a dime. We had an article this week

about that at the Free Press, and the answer is, no, it can't turn on a dime because the dimes are already invested. People are driving around those dimes right now.

They're filling them with electricity, and it doesn't matter who's in the White House for a long period of time.

Speaker 3: Great point, great point. Here we are sitting in twenty

twenty five. Everything for twenty twenty eight is already done. Yeah,

so talk about, you know, the inability to spin on a dime like that. It's like I said, everything's been set.

Speaker 1: The one thing I'll say is that cars would not be as clean burning today, nor would they be as safe for crash safety or occupancy safety if the government didn't regulate it. We just wouldn't be anywhere near here.

I was working on a story when I came on your show, just you know, kind of researching like exactly how much cleaner vehicle tailpipe emissions are now versus like you know, nineteen seventy five, and it's enormous. It's enormous

ninety nine points, Yeah, exactly, it's it's amazing. And that

was done by government regulation because there's a social benefit that's kind of been agreed upon, and because of the cost of taking it further to combat climate change. There's

been a big four worse. It's didn't happen yesterday. It's

been a big force of opposition in the last ten years because we cost benefit. Let's you know, it's going

to cost as much, it's going to increase our costs as much. What is the actual benefit and things like that.

So but disruption, disruptions, okay, you know, disruption's okay, but the speed of it that these folks are expecting in this nonsense with the which is pure nonsense. These companies

have been playing by the rules. They've been making massive

investments on either side of the border. They had no

expectation that and shouldn't have had that. The deal that

they've been working on, which was struck in the first Trump administration, was going to be essentially repealed. You know,

it's not fair and it's.

Speaker 3: Stupid because we don't know the final results yet, but at least the threat.

Speaker 7: Who knows the final results?

Speaker 1: Stupid, right, the threat.

Speaker 3: Well, but you know, going back to your point on government regulation, I agree cars are cleaner and safer today because of government regulation, and that's where the government should step in when the marketplace is not going to fix this on its own or is going to take too long to do it, you know. But I will say

the Biden administration fuel economy rules and emissions were way too stringent. And I would also argue that nitza's safety

mandates have not done anything to reduce highway motor vehicle fatalities and injuries. I mean nothing, It's gotten worse in

the last decade.

Speaker 1: Well, my only pushback on that is that they can do everything that they can do under the sun to make the car safer, but what they can't do is keep people from staring into their phones when they should be driving. And that I don't know about you, John,

but man, when I see so many cars acting weirdly on Route ninety four, which travel all the time, and every time I pull up, literally there's a there's somebody with a phone up like this while they're trying to drive.

I mean, that's not on the OEMs. That's I mean,

in fact, someday we're gonna have to figure out a way to prevent that. I'm not sure exactly how, but

but you.

Speaker 3: Would think with things like you know, forward collision warning, automated breaking, blind spot detection, you know, you would think that that would have overcome some of that stuff.

Speaker 7: I think becomes standard.

Speaker 3: It's all standard now, it's on every vehicle parked. Like, yeah, well.

Speaker 7: That's a good point.

Speaker 6: But I mean, obviously something they can do is not make flat screens that are this big that I have to take my entire face away from the road in order to change the climate or the song that's playing.

Speaker 7: But there's the element of yes, people are people.

Speaker 6: They put their makeup on behind the wheel, they text, they get drunk and try to drive, and there are catastrophic consequences of that. And obviously the automakers can do

what they can. They can make those investments and standardize them.

But I talk with our auto critic all the time, Mark Feelin, about these specific peaces and functions that the vehicle can have these features, and the first thing we ask is, well, can you shut them off? That's bored.

I hate that the buzzing, it's annoying. I don't know,

like when the car's trying to drive for me, leave me alone.

Speaker 7: I know what I'm doing.

Speaker 6: And that is the hubris that can start a lot of these incidences on the road. And obviously we dream

of the utopia where my car can communicate to the one behind it and the one behind that, the one behind that that there's an object on the highway and I need to break suddenly. But until we get to

a place where the software can be integrated across vehicles that they're all working in harmony and doing better than the humans can, you know, that's that's something that's going to take time and investment and regulation and regulation and cooperation between automakers that are competitors, and possibly regulation. So

it's just it's hard to think of the utopia that you know, the ideas of which maybe or may not be coming from Silicon Valley. But there is a threat

to that in a way, that long termism concept that you know, to get to this mobility future that we're all striving towards, we have to do the testing, we have to try this out and the market and there will be and already have been fatalities. So there's no

easy way. Do I trust a robot? Do I trust

a person? Depends on the person, depends on the robot.

Speaker 7: Where are we?

Speaker 1: So?

Speaker 7: I just I think it's crazy. But going back to

your idea of like what the marketplace can decide? What

is the marketplace? I go back to the courts comment

we made. You know, it's up to us.

Speaker 6: The onus has always been on the US citizen to determine if the product is dangerous, and.

Speaker 7: We usually do that by litigation.

Speaker 6: We have to prove the roundup causes cancer, or that the weird orange dye in the craft mac and cheese it's probably not for human consumption. But when it comes

to vehicles and safety, we know we have historical evidence that there are rooms in these automaking companies that they discuss these things.

Speaker 3: Well, we could fix.

Speaker 7: It, or we could pay out the lawsuits. So what's

the choice?

Speaker 6: What's the You know, whenever people ask me what it is to be a business reporter, I say, there's literally one thing you ever have to think about, which is the goal of a company to take in more money than it puts out.

Speaker 7: That's it.

Speaker 6: Every decision every decision centers around that concept alone. So

where are they saving money? Where are they spending money?

And well what happens?

Speaker 1: You're reminding me of a memory I have from my middle school journalism class.

Speaker 7: Oh god, when.

Speaker 1: The teacher asked the the class what is the purpose of the news media? And because my father was a

newspaper man, I knew it's to make money. Everybody's to

inform the public.

Speaker 3: And no, no, I know, Okay, switching gears a little bit.

Nissan got a new CEO. I don't know if you

guys have followed. This guy's name is Ivan Espinosa and

apparently from Mexico.

Speaker 1: We're born in Mexico. First first Mexican born ceo of

a global other companies so far as I can.

Speaker 3: Tell, really, wait a minute, where's uh Josse Munio? Oh

he's Spanish? Okay, so but still I found it very

interesting that Nissan once again went to a non Japanese ceo, you know, Carlos going being the one that you know, decade ago or whatever they went with. But I found

it very interesting that they went from somebody outside, you know, the the Nissan Japanese fear to run the company.

Speaker 1: I think it's uh. I thought it was interesting too,

I think, is my guess, and I have talked to some people, but about this, it's hard. It can be

hard to get too close to the workings of a Japanese company's board and et cetera, et cetera. But done

the best I could. He's a really good, well thought

of guy internally, so, you know, hats off to the board, which is also not all Japanese for for it looks like just choosing a meritocracy that this guy is up and coming. He knows the company through and through. He's

not uh, he's not a disciple of Uchio Acha put his arm around him. But he's going to be his

own guy and recommend to the board where to go with the Honda or an equity investor like fox Kahn or some sort of partnership like that. I mean, it

looks he looks like a very solid choice. He's a

product guy, which is good, rather than a finance treasury guy, because Nissan's got some serious lineup issues globally, a lot of deficiencies that they have to fix. But it looks good,

I have to say, and I'll just plug you know, our stuff. We said in December that this merger was

unlikely to happen with Honda the way it was laid out.

Speaker 3: Well, Honda wanted nothing to do with it. Was the

body language that they were given off.

Speaker 1: Yeah, and and and gave all the reasons why. I

think with Uchetah out of the way, the door is at least unlocked and cracked, you know, to maybe get back to that, but we'll have to see exactly what this guy and what the what the board really wants to do the The original structure was to have Nissan and Honda operating under a newly formed holding company, almost like the thing that it feels most similar to is

the Nissan and Renault alliance. Frankly, it looks very similar

to that, except for a true common ownership through a holding company. So I would like to see the murder

happen the way Honda wanted to do it, steering the steering the train, because obviously Honda is a much much much better managed company in every measurement you could imagine, from product to shareholder return.

Speaker 7: So I always go back to the dealers.

Speaker 6: The dealers like that's all that matters, because they know their business, they know what they need from the product standpoint, and if they think this person's going to help write the ship, and if they fall in line behind them, then you know it's going to work out.

Speaker 3: Be fascinating to see what the dealers have to say about this guy. They probably don't even know them yet,

so you know they're probably going to have to get to know them. You know another thing that I saw

this week, uh in China, this company Chipang is getting into humanoid robots. In fact, they said they might invest

as much as fourteen billion dollars in them. Tesla's doing

humanoid robots. BMW is already using them in some of

some operations in its plants, and they're like, what do you guys make of this robots coming into the plants.

I mean there's always been like spot welding and painting robots, but these are robots that get up and walk around, pick up parts and do things. What do you think, Jackie, they're.

Speaker 7: Going to turn on us?

Speaker 6: I thought, wasn't Tesla was that really a robot? Or

wasn't that just a person operating the view.

Speaker 4: In a suit?

Speaker 1: Yeah? Suit?

Speaker 3: I mean my thing is we're remotely controlled to a degree.

But you know where this is going where it's not going to be remotely controlled.

Speaker 6: I have a very specific view on this because when I was at Automotive News, one of the biggest and first projects I worked on was the intersection of the opioid epidemic and the manufacturing industry. And it wasn't very

difficult for me to find a worker at a Ford plant who had an umbilical hernia that he suffered working on the line and ended up getting drug addicted because of that. And this was the time where they were

over prescribing opioids, and obviously with the EUW benefits, he had amazing coverage.

Speaker 7: But this began this cycle of addiction.

Speaker 6: And when he explained to me how he got the umbilical hernia, it seemed ludicrous. He's like, well, you know,

for twelve thirteen hours a day, I would have been completely in half, pick up a very heavy part, stand up and put it on a vehicle. It was in

one of Fords, Kentucky truck plants, and I was thinking, that's ridiculous, like, why would they do that, Why would any person think that that was okay for human body to undergo. And so when you think about a robotic

assistance on the line. Now, a lot of these investments

are to protect workers rather than necessarily replace them. I

don't know if we're going to end up quickly on like a sort of Star Wars clone Wars situation, or like those androids that are just completely doing everything robots making robots. There's a little bit there's still human oversight

the software. If we have trouble connecting phones to cars,

I don't know if we can trust an entire robot to build it without supervision. But there's still something to

be said for the safety features that certain technology allows and the protections it offers to our rail organic bodies that have a very difficult job to do. Even if

it seems simple, that mental strain and that physicality of just doing one thing over and over again for hours and hours.

Speaker 7: Assembly line work is no joke.

Speaker 6: So my thoughts are, if they're willing to invest in something that helps their workers and protects people saves lives, that's overwhelmingly a positive thing. However, at the same time,

how effective it is, and if companies are going to jump the gun and make some of these changes before they're ready, which we've seen companies do time and time again.

I mean, there's plenty of people out there who think a robot can do my job pretty easily. And time

will tell what happens with that mentality, but I think it's a possibly positive change.

Speaker 7: But as always, we've got to see what actually happens.

Speaker 1: We're in a massive reckoning driven by artificial intelligence, I mean, and the reason that they'll do it, the reason why they'll do a plant that produces vehicles, is somebody is measured, Okay, what are our costs over x number of years putting in robots, reducing our line worker needs, having supervised, having people who who are trained at guiding the AI tools

in factories and things like that. We're in it. I mean,

that ship has sailed. Every company that manufactures with an

assembly line is dipping. Is either ankle deep or knee

deep in this right now. And to your point about

replacing us, that's already happening, I mean, you know, I mean, there's a lot of websites that there's one person who one or two people who were just deciding what the AI content is going to be, that they're going to load up on the site and get their clicks in traffic.

However it comes through tactics and whatever and it's cheaper than having a staff of fourteen people, you know, and just take that to the factory. I mean, one of

the reasons that we've seen the entire calls their business in the US go to India basically is that. And

I looked at those years ago when I was working at BusinessWeek, the call out rate at a call center in the US can be higher than twenty percent on every day, every day, twenty percent, you can be looking at they were twenty percent of your workforce called out.

It's and that doesn't happen in absenteeism, yes, and so and and to your point, people get hurt, people get uh drug addicted, people use drugs. People, So all kinds

of people problems you can have at a factory. And

uh Also, I'm just gonna say, I don't mean to make anybody angry. Last time I checked, the robots weren't

going to have a union, you know, and there weren't.

They'll need maintenance, but they're not going to need healthcare.

And they don't have families that have to be covered on healthcare. So I mean, that's for another day. But

the elephant in the room about all of whether how much manufacturing is here versus Canada and Mexico. It a

lot of a lot of it boils down to hourly wage and healthcare costs, and you know, until they fix those things, we're just going to be hitting the ping pong ball back and forth across the table with you know.

Speaker 3: So yeah, well, look we're gonna wrap us up. I

want to thank the both of you for being here, Jackie Charniga from the Detroit Free Press, David Kylie from WARDZ Auto. Great to have had Jason Norton from JD

Power earlier on the show, but we're gonna wrap it up here, and I want to thank all of you for having tuned in.

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