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Spendy, yet unreliable vehicles

Forbes.com ranks the most unreliable luxury cars on the market.
South Korean models pose with German aut
South Korean models pose with BMW's new 760 Li sedan last month. Forbes.com ranks the BMW 7-Series as one of the most unreliable luxury vehicles on the market.Jung Yeon-je / AFP - Getty Images
/ Source: Forbes

One of the great stories about unreliable cars is E.B. White's 1936 short story "Farewell, My Lovely!," which concerns the last days of the Model T.

White speaks lovingly of the car — as many Americans who were exhilarated by the new vehicle would have. But he also recites a litany of problems with the Model T, which make it seem unlovable by today's standards.

"A Ford was born naked as a baby, and a flourishing industry grew up out of correcting its rare deficiencies and combating its fascinating diseases," he writes. "You bought a radiator compound to stop leaks...You bought special oil to prevent chattering...After the car was about a year old, steps were taken to check the alarming disintegration." For example, he writes, the vehicles' fenders "softened and wilted with the years."

These days, we think a car is unreliable if its dashboard clock has recurring problems, and the government keeps track of even more minute issues. Go to the National Highway Traffic Safety Administration's Web site (www.nhtsa.gov), and you will find that Ford Motor's 2005 Jaguar S-Type sedan has had a recall that will potentially affect 50,000 models. Why? According to the government, "The brake-fluid master-cylinder reservoir is recessed and oriented in the engine compartment beneath a leaf screen, such that the brake fluid warning statement embossed on the top of the reservoir is not visible by direct view." Somebody call Ralph Nader.

This kind of problem seems like nothing compared with wilting fenders, but the S-Type is just one example of a modern luxury car that has developed a reputation for unreliability. Other luxury cars have had reliability problems — particularly cars made by DaimlerChrysler's Mercedes-Benz subsidiary. The slide show that follows lists 14 unreliable luxury cars, and four are from Mercedes. The only other manufacturers with more than one model on the list are BMW and Jaguar, with two each.


In March, Mercedes issued a worldwide recall reportedly affecting 1.3 million cars — and this recall was for more serious problems than unreadable labels. It concerned six- and eight-cylinder gasoline engines built between June 2001 and November 2004; battery-control-unit software on E-Class and CLS-Class sedans made from January 2002 to January 2005; and braking systems on E-Class and CLS-Class models, as well as SL-Class convertibles, built from June 2001 to March 2005, according to a statement released by Mercedes.

In one sense, luxury cars have difficulties with reliability ratings because their owners have higher expectations for the vehicles and are more likely to complain when things go wrong. But not every luxury automaker has problems with reliability. For example, cars from Toyota Motor's Lexus subsidiary, such as the RX 330 and LS 430, have great track records.

But Consumer Reports — the auto industry's gold standard for reliability information on individual models — assigns "predicted reliability" ratings of "poor," the lowest on its scale, to 14 luxury cars currently on the market.

The ratings come from information on 810,000 vehicles from model-years 1997 to 2004. To create the predicted reliability ratings, the organization averages a car's overall-reliability scores for the last three years, where available, provided the vehicle has not changed significantly in that time. Each car's score is weighted to emphasize serious problem areas, such as the engine, transmission, cooling system and drive system. Consumer Reports does not issue predictions for new or overhauled models.

Having "predicted reliability" ratings stem from the past three years means the dishonorable performances of the models in the slide show do not necessarily apply to 2005 models. In fact, few of the cars in the slide show have been recalled in model-year 2005.

Some cars have improved over the past three years, but still have a poor three-year average, and thus a predicted reliability rating of "poor." You may find yourself reading the slide show and asking, "Why should I care about what happened in 2002?" The answer, as Consumer Reports will tell you, is that you predict how current models are likely to hold up based on data from past model years. But if you're buying a 2006 model (some are already available), the car's predicted reliability may be even better than what Consumer Reports currently says, as the last model year it studied was 2004.

Some automakers with reliability problems are now doing things differently. In J.D. Power and Associates' 2005 Initial Quality Study (IQS), which came out in May, BMW rose to third place in the Nameplate IQS Rating, up from ninth place last year. Mercedes rose to a fifth-place tie with General Motors' Cadillac subsidiary, after finishing eighth last year.

Mercedes and BMW are on a mission to improve quality. Not only have they bolstered sales by polishing their reputations; they are also decreasing their warranty expenses. "We are now producing the best product quality ever, and our aim is to ensure that those vehicles in the hands of customers that are the cause of complaints achieve a standard of quality that reflects our highest expectations," said Dr. Eckhard Cordes, who runs the Mercedes Car Group for DaimlerChrysler, following the big recall in March. Cordes, who assumed his current position in October 2004, has made restoring a reputation for quality to Mercedes cars one of his highest priorities.

Automakers are, as a group, making improvements in reliability. According to J.D. Power's Vehicle Dependability Study, which came out last week, the industry has recorded a 12 percent improvement in long-term vehicle quality this year. The categories showing the most significant improvements in 2005 include ride, handling (response to steering forces), braking, engine and interior.

We wouldn't be surprised if many of the automakers on this list soon regain their reputations as paragons of reliability. And even those that may continue to earn the displeasure of finicky drivers and reviewers still offer enough in the way of luxury, performance and driving pleasure to make unreliability seem like an after-thought.

After all, modern luxury cars have come a long way since the Model T. Even though they may score low in reliability, cars such as the BMW 7 Series sedan and Porsche's Cayenne sport utility vehicle are still pretty incredible. But while their fenders might not wilt, owners who have shelled out tens of thousands of dollars — or considerably more — can hardly be blamed for being frustrated by recurring problems and repeated trips to the dealership.