TSLA Tesla Inc

By Chester Dawson 

DETROIT -- Electric car maker Tesla Inc. tumbled in Consumer Reports' latest reliability rankings, along with several other domestic brands, as the U.S. auto makers rush to roll out new technologies that have made their vehicles more glitch-prone than rivals.

Tesla slid six spots, landing it third from the bottom of 29 brands this year, in the magazine's closely watched new-car reliability survey.

The company's newest, plug-in vehicle, the Model 3, earned an "average" rating -- consistent with last year's prediction -- but Consumer Reports yanked its recommended endorsement from the Model S sedan for the second time in four years, citing owner-reported issues ranging from problems with the door handle to the newly standard air suspension.

The Model X sport-utility vehicle also fared poorly this year, ranking among the worst performers in the nearly 300 models reviewed in this year's report. The influential product-review magazine pointed to ongoing problems with the falcon-wing doors and the center display screen as contributors to its "much-worse-than-average" predicted reliability rating.

Despite Consumer Reports' findings, Tesla continues to increase sales of its luxury electric cars and excitement over the Model 3 has pushed the company's market value close to General Motors Co.

Tesla challenged Consumer Reports' latest reliability assessment of its vehicles and the ranking versus peers, noting the brand and its vehicles have earned high marks from the magazine and its readers in the past.

"Not only are our cars the safest and best performing vehicles available today, but we take feedback from our customers very seriously and quickly implement improvements any time we hear about issues," a company spokesperson said.

Tesla has addressed the suspension issues in the Model S and has steadily improved the quality of the Model X, which had "some quality inconsistencies" in the earliest production models, the spokesperson said.

The Detroit car makers had a difficult year with not a single domestic brand making the top half of the rankings and several makes, including Buick, Chevrolet and Chrysler, falling multiple notches, moving them closer to the bottom.

GM, Ford Motor Co., and Fiat Chrysler Automobiles NV are each going through a heavy new-car launch period, where they are introducing a lot of new technologies to the market, such as eight-speed transmissions and more sophisticated multimedia systems, said Jake Fisher, director of auto testing at Consumer Reports.

The new features add complexity and increase the chances for things to go wrong, which is one reason their predicted reliability scores have been lower than in years past, Mr. Fisher added.

"As we get new technology, there is a learning curve" to making it work seamlessly, Mr. Fisher said in an interview with The Wall Street Journal. Tesla's performance has also been dinged because it has generally been more aggressive about rolling out new features that are still relatively unproven in the marketplace, he added.

Among the low-ranking brands was GM's Buick, which had been a strong performer over the past few years but dropped 11 slots in the latest ranking due to problems with a new nine-speed transmission. Fiat Chrysler's Jeep and Ram brands also scored poorly.

The Ford brand placed the highest among the U.S. auto makers, but dropped three spots from the previous year. Ford said it is pleased that it ranked highest among domestic brands and will review the ratings as the auto maker works to improve quality.

GM said it will use the magazine's survey data to "better understand our performance and where we can improve."

Fiat Chrysler didn't have an immediate comment.

The U.S. car companies have long lagged behind Asian brands in Consumer Reports rankings, despite steady improvement in other outside measures of quality and reliability. For example, in a J.D. Power ranking in June of quality in the first few months after purchase, several U.S. brands rated near the top, including Ford, GM's Chevrolet brand and Fiat Chrysler's Ram truck line.

Volvo ranked the lowest among the 29 brands, which Consumer Reports largely attributed to a problematic multimedia system used on several sport-utility models. Volvo, which is owned by China's Zhejiang Geely Holding Group, didn't immediately respond to a request for comment.

Toyota Motor Corp.'s Toyota and Lexus brands, meanwhile, held the top two slots, a position the Japanese car maker has occupied since 2014. Mr. Fisher said Toyota's more cautious approach to rolling out new technologies has aided them in their reliability scores, whereas brands like Tesla that tend to be early adopters have struggled.

"[Tesla] has made the decision to be first rather than make sure it is reliable," Mr. Fisher said. "That's the opposite of Toyota, who is happy to be last to the party."

A Toyota Motor spokesman said it was pleased with its high ranking. "Our brands are built on a bedrock of quality, dependability, and reliability, and this recognition from Consumer Reports helps validate our approach," the spokesman said.

The Consumer Reports seal of approval is sought after by the auto industry to help bolster marketing claims. The annual rankings are based on weighted data collected from Consumer Reports' members who own or lease a car no more than three years old.

Other Asian brands led the list, with Mazda ranking third, followed by Subaru and Kia. The only non-Asian brands in the top 10 were Audi, BMW and Mini.

Tesla's performance in Consumer Reports' reviews and surveys has been mixed over the years. The magazine first pulled its recommended rating from the Model S sedan in 2015, citing quality concerns from owners, such as body squeaks and leaky sunroofs, but in 2016 restored the influential endorsement.

Earlier this year, Consumer Reports said it couldn't recommend the Model 3 because it took too long to stop, but Tesla improved the braking distance with a wirelessly transmitted software update, prompting the magazine to reverse its earlier decision to withhold it.

Mr. Fisher said Tesla continues to command high owner satisfaction and performs well in other areas. But unlike more traditional auto makers, it continually updates its existing models, causing a wider fluctuation in its predicted reliability scores. "They're constantly changing the car," he said. "As you add more complexity, you're going to have more problems."

Write to Chester Dawson at chester.dawson@wsj.com

(END) Dow Jones Newswires

October 24, 2018 14:04 ET (18:04 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.