Total Recalls Necessitate Comprehensive Actions

iTunesArtwork@2x1Pardon the pun, but can any of us recall a time when more automakers were issuing more recalls to consumers?  Reporter Paul Eisentein posed that question this week in The Economist in the wake not only of the current GM debacle but more recent recalls from Chrysler and Toyota.  A total of more than 13 million vehicles are affected by the GM and Toyota actions alone.  In 2013, 22 million autos were involved – 20% more than the previous year. This despite the fact that quality and reliability rating have never been better.  So what gives?

Eisentein writes that, according to industry analyst David Cole, today’s high-tech vehicles can portend more things potentially going wrong.  Add in the fact, he says, that many OEMs, in an attempt to stimulate economies of scale, often share technology and manufacturing between models.  That means that when a part goes awry in one make it can affect other models; as such, what might in the past have been a recall of tens of  thousands of cars can instead become one with ramifications for millions.

There is also no denying that the major auto companies are learning their lesson in light of GM’s current woes and those past from Toyota, who, in recent weeks, was fined $1.2 billion for problems with acceleration going back to 2009-2010.  What once might have been a service bulletin, instead now becomes a full-blown recall, just in case. I was asked for the piece to comment about public perception regarding these spates of action:

“Transparency is important,” says Don Tanner, a reputation specialist with Tanner Friedman, a consulting firm in Detroit. “Hiding a defect will eventually come back to haunt you.” And where recalls were once seen by the public as a major sign of trouble, Mr. Tanner adds, they’ve become so common that they are usually little more than reputational speed bumps today—unless they become weekly occurrences or, worse, are revealed to have been delayed more than decade (as happened at GM), because a carmaker decides to put costs ahead of customer safety.

It’s a different world out there.  Sometimes dangerous, always litigious, there is simply no room for error – in communication with customers, dealers and the federal government and in taking swift corrective action aimed at safety and long-term customer trust and loyalty.