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What's an Ounce of Good Will Worth?

by Roger Lanctot | Nov 08, 2014

Day after day goes by with no resolution to the current auto recall crisis gripping the U.S. The number of fatalities attributed to GM’s ignition switch recall continues to rise even as the company acknowledges the fact that approximately 1M cars remain on the road with open recalls.

The situation has only grown worse with the emergence of the Takata airbag recall with the daily recounting on evening news broadcasts of a handful of drivers having their throats slashed by splintering airbag components.

With each passing day the auto industry is frittering away hard won customer respect, credibility and good will. Can we, as an industry, afford to allow this to continue?

The opportunity for car makers, dealers and the National Highway Traffic Safety Administration (NHTSA) is to find a creative solution to the crisis that will resolve the issue of tracking down recalled cars once and for all. There’s a pretty simple solution and it involves taking the responsibility for managing the customer communication process out of the hands of NHTSA.

If you want to know whether your car is subject to a recall you can visit NHTSA’s safercar.gov Website and enter your vehicle’s vehicle identification number (VIN). Many car makers provide their own VIN lookup resources as well.

But the NHTSA Website is creating a logjam rather than a flood. And with 1 of every 5 cars on the road in the U.S. subject to recall, it is time to open up the sluice gates.

In fact, it is not clear to me why NHTSA is seeking to manage or control the VIN lookup process. Imagine the huge boost to consumer interest in aftermarket vehicle data if the VIN lookup database were made available to selected commercial entities – like the Audiovox’s, Zubie’s and Moj.io’s of the world and their OBDII plug in devices.

Actually, my Audiovox CarConnection recently notified me of a potential recall on my car. It was a potential recall that neither BMW nor my dealer had notified me of. It turned out that the recall in question did not apply to my car, but another recall did – again, this recall was not communicated to me by either the dealer or BMW.

The point is twofold: First, the information is more valuable in private hands and Second, the existing information is incomplete. And, even though the NHTSA site offers a useful tool as a clearinghouse for customer complaints it is clear, by now, that NHTSA has a poor record of follow-up on these complaints.

The NHTSA VIN lookup actually has all available recall information going back more than a decade – or at least it is supposed to. I know, because I found an item on the list covering a $300 repair I made on my son’s car. (I am still working on arranging the refund through a local dealer. The dealer has found the recall but he cannot find the detailed information required to fulfill my reimbursement.)

But NHTSA is acting as a gatekeeper. The Website uses security tools to prevent scraping the detailed historical data. But why? Why not license the data to selected and approved third parties? And if the data were in the hands of a third party, that third party will be more likely to aggressively pursue the car makers for more complete information on behalf of consumers.

Third party service providers will have the appropriate incentives to commercialize the information and get it in front of customers. Third parties might even act as go-betweens for consumers seeking reimbursements for repairs they have already paid for but that were, as in my case, subject to an existing recall.

In the absence of such an approach, NHTSA remains part of the problem. CEO Michael Jackson of Autonation complained (in Automotive News: http://tinyurl.com/o927qj3 - “Poorly handled recalls are a 'black eye' for the industry, Jackson says”) that each brand he sells has a different procedure for handling the Takata airbag recall. But he concludes that a stronger NHTSA is necessary.

This is where Mr. Jackson is wrong. NHTSA needs to be deleted from the recall process entirely with recall and safety testing responsibility privatized – put in the hands of professionals with appropriate commercial motivations.

But we can start, at least, by getting the VIN lookup recall database out from behind the firewall. That data belongs to the owners of the effected cars. There should be nothing, including NHTSA, standing between consumers and valuable, life-saving information about their cars.

Open up the VIN database to appropriate partners – ie. NOT direct mail fraudsters – and let consumers take charge of solving the problem. In the absence of free, open access to this data, GM has been reduced to offering $25 gift cards to vehicle owners who have not yet brought their cars in: http://tinyurl.com/ky2fgfl - “GM Offers Gift Cards to Owners of Recalled Cars” – GM Authority.

In fact, why aren’t state-level DMV operations integrating with the VIN recall database? Every new or renewed registration ought to represent an opportunity to identify cars with open recalls. Am I stupid or something? This seems to be a pretty obvious step, especially when the recalls in question represent potentially life-threatening failures.

The recall crisis is indeed an opportunity. It is an opportunity for someone or some organization to step forward or step up with a rational reasonable solution to a legitimate crisis. Every day that the car makers and NHTSA allow the problem to fester is another ounce of lost industry credibility and consumer confidence. It will take millions of dollars in advertising to win back that good will. Can we, as an industry, afford to wait to solve this problem?

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