Not BMW, Not Mercedes: JD Power Says This Premium Car Brand Leads In Customer Loyalty

If carmakers can generate enough hype around their latest models, they might be able to pull in new customers that would otherwise have purchased from rival brands. Making sure those customers return to purchase their next car from the same company is another challenge entirely. With so much choice on the market and fresh-faced startups competing against the old guard, carmakers have their work cut out to persuade customers to return to their showrooms.

Some carmakers are better at retaining the loyalty of their customers than others, and according to J.D. Power's latest survey, the best premium car brand for customer loyalty is Porsche. A total of 58.2% of Porsche buyers were returning customers, which is significantly higher than the overall industry average of 49%. The second-best premium car brand for customer loyalty was Mercedes-Benz, which saw 49.7% of its customers return when it was time for an upgrade.

Loyalty levels among premium car buyers was lower than that of mass market car buyers, with Toyota boasting the most loyal customers in the latter category. According to the survey, 62% of Toyota car buyers were returning customers. Honda's customer loyalty rate reached 55.5%, putting it in second place among mass market car brands. Honda took the top spot in J.D. Power's mass market SUV category, with 62% of its buyers returning to purchase another vehicle.

Customer loyalty rates are an important metric for carmakers. A higher proportion of returning customers indicates that many buyers were happy with their previous purchases, and happy customers are more likely to recommend a vehicle to their family and friends. Additionally, J.D. Power says that customer loyalty can also help bolster the resale value of a brand's cars. It's no coincidence that models from Porsche, Toyota, and Honda all feature on the list of new cars with the highest resale value.

The customers also directly benefit when they buy from brands with high levels of customer loyalty, since the higher resale value means they can expect higher trade-in values for their cars when it's time to upgrade. With average new car prices remaining high thanks to the increasing cost of living and geopolitical uncertainty, many buyers also value predictability. No one wants to purchase a new car only to be landed with a nasty surprise regarding its features or reliability, but J.D. Power says that high levels of brand loyalty are a good indication that a brand is consistently meeting the expectations of its customers.