April 18, 2024

Bucks Blog: User Satisfaction With Online Brokerages Declines

Scottrade moved to the top of the rankings in an annual study of customer satisfaction with online brokerages, but satisfaction with the self-serve tools over all fell from last year.

The study from J.D. Power Associates found that the industry average for customer satisfaction, on an index of 1,000 points, was 752 this year, down from 768 last year. The index measures customer satisfaction of 10 “self directed” brokerages based on several factors, including customer interaction, trading charges and fees, and problem resolution. The findings are based on responses from 3,619 investors who make all of their decisions without help from an investment adviser. The study was fielded in January and February.

Charles Schwab was second and Vanguard third.

The overall decline in satisfaction stemmed broadly from “challenges with effective communication,” according to J.D. Power.

Unlike in the earlier days of online trading, many users of the services are not active traders; about 40 percent of those participating in the study said they had not made a trade in the past 12 months, said Craig Martin, director of the wealth management practice at J.D. Power. “They’re not day traders,” he said. Such users aren’t making hundreds of trades in a year, he said, but are using the accounts for information.

Some sites are offering more tools and information for investors who want to research stocks. But users may actually find it difficult to find the information they want if the Web site isn’t well organized and easy to navigate, he said. Brokerages also can do a better job of communicating with clients in the way they prefer, whether that is by e-mail, telephone or mail, the study found.

Users also seemed frustrated with the way the sites explained their fees. The percentage of investors who say they “completely” understand their brokerage’s fee structure dropped to 35 percent in 2013 from 39 percent in 2012. In addition to per-trade fees, the brokerages may also charge maintenance fees and inactivity fees.

Scottrade did well in communicating with customers, which helped it move from third to first in the rankings, Mr. Martin said. The service scored well in account offerings, trading charges and fees, and interaction. “They help customers completely understand the fees,” he said, and its fee structure is “simple and straightforward.”

The overall industry score suffered from declines in satisfaction at some of the larger players, which pulled down the index because those firms represent a large number of customers, he said. Fidelity, for instance, dropped from fifth place last year ( when it tied with T. Rowe Price) to seventh place this year, although it still ranked above the industry average.

Three firms ranked below average: ShareBuilder from Capital One (formerly owned by ING Direct), Merrill Edge and Wells Trade.

Do you use an online brokerage, and are you pleased with its service?

Article source: http://bucks.blogs.nytimes.com/2013/06/17/user-satisfaction-with-online-brokerages-declines/?partner=rss&emc=rss

Car Sales Improved in August; G.M. Up 18%

General Motors said its sales in the United States rose 18 percent from August 2010, and the Ford Motor Company reported an 11.2 percent increase.

Chrysler said sales were up 31 percent. That included a 58 percent increase for its Jeep sport utility vehicles.

August marked the 17th consecutive month of year-over-year increases for Chrysler, whose recovery is gathering momentum after being written off by many critics after its 2009 bankruptcy.

Nissan reported a 19.2 percent gain, and Volkswagen said sales rose 10.4 percent.

G.M. said it remains confident in its full-year forecast for the entire industry of at least 13 million sales, even as many analysts have chopped their projections recently.

“Consumers are being cautious, and appropriately so, but they are not retrenching,” said Don Johnson, G.M.’s vice president of United States sales operations, on a conference call. “All indications to us are that the industry is going to slowly grow for the rest of this year.”

Other carmakers were scheduled to report sales later Thursday. Analysts were forecasting another month of disappointing numbers from Toyota and Honda, whose inventories were decimated by the earthquake and tsunami in Japan in March. Nissan, which was able to return to normal production levels much faster, ran ads last month juxtaposing the abundance of inventory at its dealerships with bare Honda showrooms.

August began with uncertainty caused by the debt-ceiling debate in Washington, and ended with much of the East Coast focused more on the weather than on buying a new car. In addition, some shoppers probably stayed on the sidelines in the hope of getting a good deal during the upcoming holiday weekend, said Jeff Schuster, executive director of global forecasting at J. D. Power and Associates.

“We did see things get a little bit weaker as we got into the second half of the month,” Mr. Schuster said. “Many buyers are still conditioned to the strong Labor Day sales, so we could have seen some buyers pull back their purchase decisions waiting for some deals.”

From January through July, total industry sales rose 10.9 percent. Excluding the 7.1 percent decline at Toyota and 2.6 percent decline at Honda, rest of the industry was up 16.6 percent.

“The reality on the ground is not as bad as the market has inferred from the weakness in economic data,” Peter Nesvold, an analyst with Jefferies and Company, wrote in a report this week. “September will be the acid test of underlying demand for the rest of the year as headwinds from tight inventory and the debt ceiling debacle dissipate, in our view.”

Nissan pulled further ahead of G.M. last month in the battle between the Leaf electric car and the Chevrolet Volt plug-in hybrid. Leaf sales for the month were 1,362, more than quadruple the Volt’s 302. G.M. halted production of the Volt this summer to retool in preparation for a large increase in production and said it is still working to build inventory of the car enough to meet demand. It has promised significantly higher Volt sales in the months ahead.

“Every unit that we ship right now is pre-sold,” said Alan Batey, the head of Chevrolet sales in the United States. “It’s essentially a magnet for us. It’s doing a wonderful job for the brand.”

Article source: http://feeds.nytimes.com/click.phdo?i=0edd36412c3b69ffc27986788a23a7f6

Car Sales Show Restrained Growth

 DETROIT — Automakers said Tuesday that sales growth of new vehicles in the United States rose in July but continued to be hampered by economic concerns and low inventories of many Japanese models.

 Sales fell 28.4 percent last month at Honda and 22.7 percent at Toyota compared with July 2010. Both companies have been struggling to meet demand because of parts shortages caused by the earthquake and tsunami that struck Japan in March.

Most other major carmakers reported modest increases, including gains of 7.6 percent for General Motors and 6.1 percent for the Ford Motor Company. Nissan, whose production was not significantly disrupted, said sales were up 2.7 percent.

Chrysler’s sales rose 20.1 percent “in a market that remains tougher than a cheap steak,” its head of United States sales, Reid Bigland, said in a statement.

“The recovery is clearly in a stall mode,” said Paul Ballew, the chief economist at Nationwide Insurance and a former G.M. sales analyst. “It’s hard to see sales sprinting forward without some help on job and income growth. There’s a lot of wind that’s really out of the consumer’s sails right now.”

Over all, automakers estimated that the industry’s seasonally adjusted, annualized sales rate climbed to about 12 million in July, from a rate of about 11.5 million the previous month and a year earlier.

 “The auto industry is having a difficult time shaking off adversity, as vehicle sales start the second half of the year better than June but not as strong as many people had hoped,” said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. “A recovery pattern is still expected, but the pace could be in question.”

 Increases in unemployment and economic fears caused by the debt ceiling debate in Washington were among the factors deterring car shoppers in July, analysts said. Even though Congressional leaders reached a last-minute deal to avoid defaulting, the issue will continue to cast a shadow on auto sales, predicted John Hoffecker, a managing director of the restructuring firm AlixPartners.

“What it brought to the forefront in many people’s minds is the shape the country is in, and raising the ceiling does not solve those concerns,” Mr. Hoffecker said. “We don’t see a significant pickup happening between now and the end of the year.”

 In addition, the Japanese automakers still are working to replenish inventories of popular vehicles like the Honda Accord and Toyota Camry after production was slowed in March. Honda has said it expected plants to be essentially back to normal this month, and Toyota has said full output would resume by September.

 “The Japanese companies should start to regain some of the market share lost over the past four months as production and inventory gradually improve,” Peter Nesvold, an analyst with Jefferies and Company, wrote in a report last week. Mr. Nesvold forecast that September would be the first month since April in which sales reflected true demand rather than low inventories.

 Meanwhile, Toyota and Honda have been piling on discounts in the hopes of encouraging consumers to make a purchase. Incentives on Japanese vehicles were 24.5 percent higher in July than in June, to an average of nearly $2,000 a vehicle, according to the car-buying advice site Edmunds.com. Incentives on all vehicles averaged 7.6 percent higher in July.

 “With production working its way back to normal, the Japanese are making a strong play for their lost market share, and American automakers may need to kick in more incentives as they fight for more consumers,” said Jessica Caldwell, a senior analyst at Edmunds.com.

 Ford and G.M. have also been affected by inventory problems. Their most fuel-efficient models, including the Ford Focus and Chevrolet Cruze compact cars, have become scarce as consumers seek relief from high gas prices, but the companies have been reluctant to add extra shifts given the fragile state of the economy. Instead, they are trying to bolster output through lower-cost, less-permanent actions, such as running some plants on overtime.

“We’re shipping everything we can to meet consumer demand,” said Ken Czubay, Ford’s vice president for United States marketing, sales and service. “But consumers are telling us they want two more than we can produce. We’re running flat-out.”

At the same time, supplies of pickup trucks and larger vehicles have been ballooning, creating concerns among analysts that the companies will start slashing prices to keep dealer lots from becoming too crowded.

The uncertain sales environment cut into the second-quarter earnings reported by Ford and Chrysler last week. G.M. was expected to report a second-quarter profit on Thursday. 

Article source: http://feeds.nytimes.com/click.phdo?i=d533c4a678f92912ff92db083521a8c6