J.D. Power Asia Pacific Reports: Vehicle Appeal Has a Strong Impact on Customer Loyalty and Advocacy

Honda Receives Two Segment-Level Awards; and Volkswagen Each Receive One

TOKYO: 25 September 2014 ― Automakers offering vehicles that have high appeal for owners increases customer loyalty toward and advocacy for the nameplate, according to the J.D. Power Asia Pacific 2014 Japan Automotive Performance, Execution and Layout (APEAL) StudySM released today.

The Japan APEAL Study, now in its fourth year, serves as the industry benchmark for new-vehicle appeal. The APEAL Study examines how gratifying a new vehicle is to own and drive. The study is used extensively by manufacturers worldwide to help them design and develop more appealing vehicles and by consumers to help them in their purchase decisions. Owners evaluate their vehicle across 77 attributes, grouped into 10 categories of vehicle performance: exterior; interior; storage and space; audio/ communication/ entertainment/ navigation (ACEN); seats; heating, ventilation and air conditioning (HVAC); driving dynamics (driving performance); engine/ transmission; visibility and safety; and fuel economy. The overall APEAL score averages 622 on a 1,000-point scale in 2014.

The study finds that there is a strong correlation between APEAL scores and recommendation and repurchase intentions of vehicle owners. On average, 7 percent of vehicle owners say they “definitely would” recommend the same vehicle model to others and 6 percent say they “definitely would” repurchase the same nameplate. However, when overall APEAL scores are 727 or higher, 17 percent of owners say they “definitely would” recommend their vehicle and 15 “definitely would” remain loyal to the brand.

“Owners who are highly satisfied with their new vehicle have strong intentions to recommend or repurchase the same make, which is critical since 1 percentage point of loyalty is worth hundreds of millions of yen to automakers,” said Atsushi Kawahashi, senior director of the automotive division at J.D. Power Asia Pacific. “Providing appealing vehicles is the key to building customer loyalty, as well as attracting new customers.”

The J.D. Power Asia Pacific 2014 Japan Initial Quality StudySM (IQS), released in August, finds that recommendation and repurchase intentions decrease when customers experience even a single problem with their new vehicle. Kawahashi notes that as initial quality improves―67 percent of owners in the IQS indicate they did not have a single problem with their vehicle during the first two to nine months of ownership―it becomes increasingly important for manufacturers to provide highly appealing vehicles in order to differentiate themselves in the mature Japanese market.

The average APEAL scores in each segment are: • Mini-car segment: 596 • Compact segment: 617 • Midsize segment: 651 • Large segment1: 706 • segment: 622

1 For a segment award to be issued, there must be at least three models with 67 percent of market sales in any given award segment. In the large segment, these criteria were not met, so no award has been presented. (Page 1 of 2)

The mini-car segment has the lowest average APEAL score, despite the segment having the fewest average number of problems reported in the 2014 Japan IQS.

2014 APEAL Ranking Highlights Lexus is the highest-ranked nameplate, with an overall APEAL score of 738. BMW (717) ranks second and Audi (705) ranks third.

The top three models in each of the four segments are:

 Mini-Car segment: Honda N-ONE ranks highest (650), followed by the Hustler (646) and Honda N-WGN (645)  Compact segment: Toyota AQUA ranks highest (652), followed by Honda Fit (640) and (617)  Midsize segment: Volkswagen Golf/Golf Cabriolet/Golf Variant ranks highest (710), followed by Toyota SAI (696) and Axela (688)  Minivan segment: Honda Odyssey ranks highest (684), followed by Toyota Voxy (678) and Toyota Vellfire (652)

The 2014 Japan APEAL Study is based on responses from 15,684 purchasers of new vehicles in the first two to nine months of ownership. The study includes 17 automotive brands and 134 models and ranks models with a sample size of 100 or more usable returns. The study was fielded in May 2014. The APEAL Study complements the Initial Quality Study (IQS), which focuses on problems experienced by owners during the first two to nine months of ownership.

About J.D. Power Asia Pacific J.D. Power Asia Pacific has offices in Tokyo, Singapore, Beijing, Shanghai and Bangkok that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries. Together, the five offices bring the language of customer satisfaction to consumers and businesses in Australia, China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan, Thailand and Vietnam. Information regarding J.D. Power Asia Pacific and its products can be accessed through the Internet at japan.jdpower.com.

About McGraw Hill Financial www.mhfi.com

Media Relations Contacts Shizue Hidaka; J.D. Power Asia Pacific; Metro City Kamiyacho 8F; 5-1-5 Toranomon; Minato-ku, Tokyo; Japan 105-0001; Phone +81-3-4550-8060; [email protected]

John Tews; Director, Media Relations; J.D. Power; 320 E. Big Beaver; 5th Floor, Suite 500, Troy, MI, 48083 USA; 001 248-680-6218; [email protected]

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power. www.jdpower.com

# # # (Page 2 of 2) Note: Two charts follow.

J.D. Power Asia Pacific 2014 Japan Automotive Performance, Execution and Layout (APEAL) StudySM 2014 Nameplate APEAL Ranking (Based on a 1,000-point scale)

NOTE: Included in the study, but not ranked due to small sample size are Fiat and Peugeot

Source: J.D. Power Asia Pacific 2014 Japan Automotive Performance, Execution and Layout (APEAL) StudySM

Charts and graphs extracted from this press release must be accompanied by a statement identifying J.D. Power Asia Pacific as the publisher and the J.D. Power Asia Pacific 2014 Japan Automotive Performance, Execution and Layout (APEAL) StudySM as the source. Rankings are based on numerical scores, and not necessarily on statistical significance. No advertising or other promotional use can be made of the information in this release or J.D. Power Asia Pacific study results without the express prior written consent of J.D. Power Asia Pacific.

J.D. Power Asia Pacific 2014 Japan Automotive Performance, Execution and Layout (APEAL) StudySM

Top Three Models per Segment (Based on a 1,000-point scale)

500 550 600 650 700 750 Mini-Car Segment

Highest Ranked: Honda N-ONE 650 Suzuki Hustler 646

Honda N-WGN 645

Compact Segment

Highest Ranked: Toyota AQUA 652 Honda Fit 640

Suzuki Swift 617

Midsize Segment

Highest Ranked: Volkswagen Golf/Golf 710 Cabriolet/Golf Variant Toyota SAI 696

Mazda Axela 688

Minivan Segment

Highest Ranked: Honda Odyssey 684 Toyota Voxy 678 Toyota Vellfire 652

Note: For a segment award to be issued, there must be at least three models with 67 percent of market sales in any given award segment. In the large segment, these criteria were not met, so no award has been presented

Source: J.D. Power Asia Pacific 2014 Japan Automotive Performance, Execution and Layout (APEAL) StudySM Charts and graphs extracted from this press release must be accompanied by a statement identifying J.D. Power Asia Pacific as the publisher and the J.D. Power Asia Pacific 2014 Japan Automotive Performance, Execution and Layout (APEAL) StudySM as the source. Rankings are based on numerical scores, and not necessarily on statistical significance. No advertising or other promotional use can be made of the information in this release or J.D. Power Asia Pacific study results without the express prior written consent of J.D. Power Asia Pacific.