What determines the effect of a recall on a brand? NADA reveals
A new white paper from NADA explores why some auto recalls have a lasting effect, even though most are routine and consumers drive away from the dealership happy. In most cases, consumers are happy that proactive steps were taken and the problem was resolved in a transparent and timely fashion.
Recalls that hurt the brand commonly involve a large number of vehicles, numerous reports of severe injury or death and extensive media coverage, the report says. If the automaker has a reputation for quality such as Toyota at its 2009-2010 acceleration recalls that could cause the brand image to suffer more. Model age is another factor: If the recall is for older models, the brand is usually not hurt because older models are less associated with a brandês current product image.
Although the Toyota recall and GMês recent recall are similar, Toyota sales suffered much more. The results show that the same factors cause recall-related brand damage, but individual circumstances determine the severity of the damage, according to NADA.Download Bulletin PDF