It’s been a bad week for the auto industry. Already-shaken consumer confidence was further undermined as the negative headlines kept coming.
First: VW agreed to a $14.7 billion settlement in its diesel-emission scandal in the United States — one of the largest-ever consumer class-action settlements. Still unresolved are pay-outs to buyers of more than 11 million cars in other countries as well as numerous criminal investigations in the U.S. and abroad.
Second: Toyota recalled 1.43 million Prius and Lexus models because of problems with airbags manufactured by a Swedish firm.
Third: VW (again). A lawsuit was quietly withdrawn by an employee who claimed he was fired after trying to stop co-workers from destroying documents related to the emission scandal. Did they buy his silence? If so, it’s one more black mark for VW’s tattered image. Even if they didn’t, the public will believe they did. VW needs to be reassuring consumers, and this isn’t helping.
Fourth: Owners of more than 300,000 older-model Hondas and Acuras were warned that airbags made by Takata had “unacceptably high risk of exploding.” To date, 14 automakers have recalled more than 60 million Takata airbags in the U.S. and millions more elsewhere.
Finally: Tesla is under investigation by federal highway safety regulators after a fatal crash involving a car using its automated driving system. Tesla issued a statement designed to put things in perspective and reassure the public that driverless cars are safer than the norm.
Recurring problems create a perception you’re trapped in a time loop and perhaps didn’t learn your lesson after the first time. Think of Bill Murray in Groundhog Day.
Media feeds this perception and the public goes along for the ride. A longtime rule of thumb is: Once is an aberration. Twice a coincidence. Three times a trend. Trends make sexy news stories and grist for conspiracy theories.
To short-circuit this mindset, companies must go the extra mile and assure customers that their safety is the highest priority. Are recalls enough anymore? Or do manufacturers and retailers need to tighten quality controls?
For more suggestions about defects and how to handle them to protect your reputation, check out Three Things To Do During a Recall.
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