Note that the article states the 7 speed automatic transmission is the biggest problem.

By Chris Woodyard and James R. Healey, USA TODAY
Toyota's vaunted Lexus luxury brand has fallen from first to fifth in Consumer Reports magazine's annual predicted reliability survey, and it's not the only luxury brand taking a drubbing.
Mercedes-Benz was last among 36 brands. Also at the bottom: Land Rover, Hummer and Jaguar. BMW-owned Mini took the biggest tumble, falling 17 places to 28th.

The Toyota brand and the company's youth-oriented Scion brand are in the top three along with Honda, the magazine says in its April auto issue, on sale next week.

Consumer Reports, operated by the non-profit Consumers Union, bases its reliability rankings on responses from 965,000 subscribers, covering 1.3 million vehicles. The auto issue also includes the magazine's ratings of vehicles based on its own testing.

The reliability survey wasn't entirely dismissive of luxury makes. Nissan's Infiniti line was most improved, moving up 20 places from last year. Audi and Lincoln also moved up dramatically.

David Champion, the magazine's director of automotive testing, blamed one model for Lexus's fall, the midsize GS, redesigned last year. He said the car had significant problems in three areas — body integrity, defined as rattles or poorly fitting panels; body hardware, such as locks and trunk mechanisms; and the sound system.

The model still rated average — and earned a recommendation for purchase — but all other models in the Lexus line were better than average.

While Lexus dropped, Toyota officials looked at the bright side. "We had three of the top five. It reflects well on our products," said spokesman Xavier Dominicis.

Mercedes, DaimlerChrysler's luxury brand, tumbled four places to the cellar, "a very poor showing for a very expensive car," Champion said. Mercedes' quality is so imperiled that a nine-year-old Lexus LS400 has potentially fewer problems than a brand-new Mercedes ML.

Champion said of Mercedes: "They perform well, have great fit and finish. But they seem to have a lot of problems with the seven-speed automatic transmission in all their products, and power accessories and electrical systems."

Mercedes officials disputed the findings. "Today's Mercedes models ... are without question some of the best we have ever built," said spokeswoman Donna Boland. "If the survey doesn't reflect that, there's something wrong with the survey."

She noted that 74% of the Mercedes models sold in the U.S. the past 50 years are still on the road. And a 2006 survey by R.L. Polk showed that Mercedes has the highest owner loyalty of any brand.

Mercedes had well-publicized quality issues a couple years ago, but they were fixed, Boland says. "We have been out-front about that. But the data we have on the new models absolutely support that the quality is right up there with people's expectations."

Mini fell because of reliability issues with the supercharged convertible version of the sporty car, Champion said.

Mini spokesman Andrew Cutler said he couldn't explain why his brand fell in the rankings. An all-new replacement for the Mini was introduced this month. "They must be factoring in a drop in reliability (now) that the cars are all new from plant that's been upgraded," he said

Oh great.  Last place.  It's not going to get too much worse now, right?

Spokeswoman Donna Boland: "If the survey doesn't reflect that, there's something wrong with the survey."

Well of course.

Look at it on the bright side: The only place they have to go from here is up! 

We can dream, can't we? 

"As God is my witness, one day a Mercedes will be as reliable as a Hyundai"  

Another thing to consider is the fact that MB service is, at most locations, less desirable than the average dealer. It is amazing how many dealers are not knowledgeable about what they service. An example would be the response from MB of Huntsville when I gave them the TSB # on the fluctuating audio in my radio on the 2002 ML320. They acted as if they knew nothing about the TSB or the fix for the problem. I then called J.W. Johnson, a SA at Crown Mercedes in Birmingham and he knew right off what I was talking about. He said for me to bring it in and he'd fix it for $30.00. MB of Huntsville wanted a minimum $90.00 charge just to find out what it was. Then they were going to charge me extra to fix it, 'if they could'.

Bad service does help to bring the ratings down, even if the problem at hand is a simply solvable one. 

I have to agree.  Now that I've used three different MB dealers...

The service hasn't been horrible, but it also hasn't been like what you get at a Lexus dealer.

OTOH, Lexus service is bound to be less taxing on the SA's, relatively speaking.