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UPDATE 2-Ford tumbles again in reliability survey; Toyota gains

* Ford, Chrysler sink in Consumer Reports reliability survey

* Ford rating hurt by glitches in transmission, MyFord Touch

* GM brands all gain; Toyota sweeps top three

DETROIT, Oct 29 (Reuters) - Ford Motor Co tumbled to nearly the bottom of an annual survey of vehicle reliability due to flaws in its touch-screen navigation and entertainment system, while Japanese automaker Toyota Motor Corp swept the top three spots.

In a Consumer Reports survey released on Monday, Ford fell seven spots to 27th of 28 brands surveyed overall, while its upscale Lincoln brand fell 12 spots to 26th place.

Two years ago, Ford placed in the top 10 with more than 90 percent of its models being average or better.

Glitches in its small car transmission as well as its MyFord Touch and MyLincoln Touch systems have hurt the second-largest U.S. automaker in the rankings.

``Only two years ago, Ford was Detroit's poster child for reliability,'' Consumer Reports magazine said. ``Since then, a perfect storm of reliability problems has dropped Ford to next to last among the 28 brands in our survey.

This year, 60 percent of Ford models and half of Lincoln models were rated below average. None were rated above average.

Sixteen of the 27 models in Toyota's lineup won the highest rating. Toyota's youth-oriented Scion brand kept the No. 1 spot on the survey. The Toyota nameplate rose four spots to No. 2. The luxury Lexus brand dropped one spot to third place.

MYFORD TOUCH FLAWS

Touch screen entertainment and navigation systems now play a pivotal role in attracting car shoppers, but automakers have struggled to create systems that are both intuitive and safe.

MyFord Touch was launched in 2010, but consumer complaints about speed and ease of use prompted Ford to upgrade the system in March. Still, Consumer Reports said it was too complex even after the upgrade.

Ford's top executives, including Chief Executive Alan Mulally, got smaller cash bonuses for 2011 when Ford fell short of quality goals partly due to the MyFord Touch glitches.

''We listen closely and value feedback on our vehicles whether it's from customers or third parties, such as Consumer Reports,`` Ford said in a statement on Monday. The company added that consumers who had the upgrades were 25 percent more satisfied.

Ford's worst performing model was the Explorer sport-utility vehicle. Sixteen percent of consumers who purchased an Explorer complained about the control systems, said Jake Fisher, Consumer Reports director of automotive testing.

Ford was also hurt in the rankings because three of its most reliable models, the Escape crossover and Fusion and Lincoln MKZ sedans, were redesigned for the 2013 model year.

For the reliability survey, Consumer Reports uses data for the last three model years, except those redesigned for the 2013 model year.

CHRYSLER SINKS

Like Ford, Chrysler sank in the reliability rankings this year, when Consumer Reports had enough data to rate the smallest U.S. automaker's revamped lineup. The Dodge Charger's rating was well below average, the magazine said, while the V8 Jeep Grand Cherokee had declining reliability.

General Motors jumped in the rankings led by its Cadillac nameplate, which rose 14 spots to 11th place to become the highest-ranking U.S. brand. GM's other brands GMC, Buick and Chevrolet also improved.

''The Volt extended-range electric car continues to have above-average reliability, and the compact Chevrolet Cruze, dismal in its first year, improved to average,`` Consumer Reports said in its survey.

Fisher said that Cadillac's reliability ranking may suffer in the future as consumers provide feedback about the recently launched CUE entertainment and navigation system.

Audi, Volkswagen AG's luxury brand, shot up 18 spots, the largest gain of any brand. The brand, which has typically been near the bottom, landed in eighth place.

The top seven spots in the survey were earned by Japanese brands. None of the brands produced a vehicle that was below average reliability, the survey showed.

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