Who Makes the Best Cars?

Overall, the best cars sold in the U.S. are made by Honda. That's the conclusion of a recent analysis conducted by Consumer Reports that looks at the reliability, performance, fuel economy, comfort, interior fit and finish, and ergonomics of 262 vehicles we've recently tested.

Honda, with an overall score of 78, is followed closely by Toyota (75) and Subaru (72). BMW, Mazda, Nissan, and Volkswagen are tied at 71, after rounding.

Detroit automakers garnered some of the lowest scores, but we have seen some significant signs of improvement in Ford and GM vehicles this past year.

The overall score for each automaker is based on the average overall scores of its vehicles in our road tests and its average predicted-reliability score from our Annual Car Reliability Survey, which details the problems subscribers have experienced with almost 1.3 million vehicles. We included manufacturers only if we tested at least five of their vehicles. See the automaker report cards on the facing page for a summary of each.

Other findings include the following:

* Only two automakers, Honda and Subaru, earned the distinction of having all of the models we tested make our Recommended list. Because we have not yet tested the redesigned Subaru Impreza and WRX, Honda is the only automaker whose entire model lineup is currently recommended.

* Some vehicles that do well in our testing tend to have a relatively high number of problems reported by owners in our reliability survey. For example, vehicles built by Mercedes-Benz and Volkswagen (including Audi) achieved the best average scores in our tests. But the reliability of Volkswagen vehicles overall is below average, while Mercedes' reliability is well below average. We don't recommend vehicles with below-average reliability, which limits the number of recommended models for those automakers.

* On the other hand, some vehicles that are very reliable don't post the best scores in our testing. Some Subaru and Toyota models, for example, score midpack or lower in our testing but are very reliable overall.

* Of all the Ford vehicles we've tested, the percentage that we recommend jumped to 64 percent from 54 percent last year, due to improved reliability. The percentage of GM vehicles we recommend, however, dropped from 36 percent to 30 because some redesigned SUVs proved unreliable. Similarly, Chrysler's percentage dropped from 21 percent to 14, due to a number of unimpressive new vehicles.

SETTING THE STANDARD

Honda earned the top score in our analysis because it builds very reliable cars that perform very well. Its average test score is only slightly under Volkswagen's and Mercedes-Benz's. And Honda is the only automaker to earn an excellent overall reliability Rating.

But not all of Honda's models lead their class in our test Ratings. The redesigned Honda CR-V SUV, for example, can't quite match the top-ranked Toyota RAV4. The Accord was edged out by the Nissan Altima. The Honda Odyssey minivan scored slightly lower than the Toyota Sienna. And some of Honda's upscale Acura models trail their Lexus counterparts from Toyota. But Honda's strength is its consistency; its vehicles typically rate near the top of their categories.

Toyota continues to build some very impressive vehicles, such as the new Highlander, our top-scoring three-row SUV, and the Lexus LS, which earned the highest score in our current Ratings. But the automaker's reputation for reliability has shown some cracks. For the first time in years, three Toyota-built models had below-average reliability in our survey. They included Toyota's redesigned V6 Camry sedan and four-wheel-drive V8 Tundra pickup, and the Lexus GS with all-wheel drive. Still, the company builds very reliable vehicles overall and ranks third in reliability among auto manufacturers.

UPS AND DOWNS FOR DETROIT

The past year has been a mixed bag for domestic automakers. Detroit's share of the North American market dipped to its lowest level ever, just above 51 percent. For the first time in history, Toyota outsold Ford in the U.S. and outsold GM worldwide to become the world's largest automaker. Sales shrank almost 12 percent at Ford, 6 percent at GM, and just over 3 percent at Chrysler. Ford and GM racked up billions in losses. And after a nine-year merger with Daimler, which owns Mercedes-Benz, Chrysler was sold off at a multibillion dollar loss.

On the positive side, all three automakers are restructuring, and there are clear signs of improvement from Ford and GM.

In recent testing, vehicles such as the Buick Enclave, Cadillac CTS, Chevrolet Malibu and Silverado, GMC Acadia and Sierra, and Saturn Outlook ranked among the best in their categories. GM's older models, however, continue to drag down its average test score. GM also builds some reliable vehicles, but overall it ranks second from the bottom in reliability, above only Mercedes-Benz.

Ford has climbed to fifth place in our reliability standings. In our latest survey, 93 percent of Ford models had average or better reliability, up from 63 percent last year. But some of Ford's latest SUVs have not matched their competition in handling, braking, or interior fit and finish.

The most recent Chrysler vehicles we've tested have been very disappointing, many with noisy, underpowered engines, poor interior craftsmanship, cramped seating, and limited visibility. Earlier this year, the company announced that it would phase out some of its older products, including the Pacifica, the PT Cruiser convertible, and the Dodge Magnum. Those were some of Chrysler's better vehicles in our testing, although some have been unreliable in our survey.

Overall, only a quarter of our recommended vehicles are from U.S. companies, which is a result of their vehicles' inconsistent reliability and performance in our testing. About half of our recommended vehicles are Japanese.

TEST RESULTS VS. RELIABILITY

If the only things that mattered to a car buyer were performance, comfort, and safety, Mercedes-Benz and Volkswagen (including Audi) would make the dean's list. Their cars ride and handle especially well, have comfortable seats, and have relatively good fuel economy and acceleration. But most VW-branded models and nearly all of the Mercedes models for which we have sufficient data are below average in predicted reliability.

On the other hand, Subarus have very good reliability. But in our testing they often end up only midpack within their classes. Subarus have standard all-wheel drive and typically deliver impressive ride and handling. But the Legacy and Outback suffer from tricky emergency handling and tight rear-seat leg room. And Subaru's standard all-wheel drive typically hurts fuel economy.

Similarly, Mitsubishi and Ford ranked fourth and fifth in reliability but were dragged down by their test scores, finishing 11th and 12th overall.

In the end, the companies that make the best vehicles are those that have found a way to excel in all areas: performance, interior craftsmanship, safety, comfort, and reliability. The best all-around vehicles each year continue to set a higher and higher standard for other companies to match. And that's a competition in which consumers are the ultimate winners.