BMW recalls 24,000 vehicles on emissions problem

What does this latest recall mean for BMW?
  • What will this do to BMW’s brand image to affluent consumers?
  • Do recalls help or hurt a high-end brand?
  • How might BMW bounce back from this recall?
  • What’s in a consumers’ mind when they hear about a recall?

“In my opinion . . .”

There is always a price to pay when issuing recalls. They take a hit financially, and their brand reliability rating and owner satisfaction index takes a hit too. The last item has much to do with how the owner is treated during the recall by the dealership. This means BMW has to make sure its dealer network gets the BMW owner through the recall process quickly as possible, with the least amount of inconvenience.

Nobody wants to be told there is a problem with their vehicle—especially an expensive one—or have to go through the hassle of getting it taken care of. It’s all in how the consumer is treated by the local dealership. As long as the dealer recognizes that this is an inconvenience for the consumer, hopefully giving the BMW owner a loaner vehicle to use in the interim, and the consumer realizes that no car company builds a perfect product, they both can get through it without a lot of drama.

Hysteria is what every automaker fears with recalls. Case in point: back in the 1980s, Audi had a bogus “untended acceleration” recall on its hands with its Audi 5000. Fueled by media and consumer hysteria, this problem, which was never proven to exist, killed Audi’s sales in the United States. It took years for memories to fade, and the company to recover.

BMW has had a record year for sales in April. Given the number of vehicles BMW produces, the number of recalls for it this year is moderate. In this particular case, the recall affects some BMW diesel engine’s emissions, and it is unclear how many luxury-minded people need or want diesel-powered vehicles.

From a branding and positioning standpoint, BMW owns the word “driving,” as in “The Ultimate Driving Machine,” so it is known primarily as a performance vehicle. The opulent appointments come only in the higher-priced BMW models. In my opinion, the best BMW can do in this case is put a positive environmental spin on their recall effort, stating that the company is committed to keeping every BMW’s emissions output as low as possible, so everyone can breathe easier.

How will consumers respond? It depends on a few factors: the number of recalls that car has already received, the particular issue being resolved, and the owner’s past experience with the dealership where the recalls are handled. This particular recall has to do with diesel emissions so it’s simple and doesn’t cause alarm or raise eyebrows. However, when a recall is addressing a design flaw that could cause harm, it will cause concern and worry. Even more so if the news media picks up on the story.

Even though this recall deals with emissions, BMW has other recalls on its hands that are more serious. For instance, a circuit board on 2012 and 2011 BMWs and some 2010 Rolls Royce (a wholly owned subsidiary of BMW), can overheat and possibly catch fire.

Photo credit: BMW USA


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