May 10, 2012
German automaker BMW's recent emissions-related recall will not harm the brand due to its luxury legacy, but the automaker should take this time to perfect service, experts say.
BMW is recalling more than 24,000 vehicles in the United States to check emissions components that may incorrectly report mileage and cause the check engine light to turn on. Experts agree that BMW will probably ride smoothly through the recall by being proactive, avoiding a media frenzy and hopefully treating this as a customer-service opportunity.
“There is always a price to pay when issuing recalls,” said Bob Prosser, CEO of Auto World Marketing Corp., San Diego. “Automakers take a hit financially and their brand reliability rating and owner satisfaction index takes a hit, too.
“Consumer satisfaction has much to do with how the owner is treated during the recall by the dealership,” he said. “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.”
“From a branding and positioning standpoint, BMW owns the word driving, as ‘The Ultimate Driving Machine,’ so it is known primarily as a performance vehicle.”
Mr. Prosser is not affiliated with BMW, but agreed to comment as an industry expert.
BMW could not be reached before press deadline.
Tap the brakes
BMW is recalling 24,340 vehicles that may not meet emissions requirements of the U.S. and California, according to Automotive News.
Emissions components may overstate mileage, which causes the vehicle produce emissions above set standards and the engine service light to turn on.
The repair will include inspection and replacement of select emissions components and repair of the engine control unit, BMW told Automotive News.
The recalled vehicles were sold from 2009-2011.
Models recalled include X5 xDrive 50i, X6 xDrive 50i and 3 Series diesel models that were manufactured in Spartanburg, SC, and Germany.
BMW X5 xDrive 50i
BMW will alert consumers with a letter.
Experts agree that by being proactive about the recall, the automaker avoided potential media hype and government interactions.
BMW found the defect on its own, which shows that it has high standards for its vehicles, per Chris Ramey, president of Affluent Insights, Miami.
“This recall will not affect the brand whatsoever,” Mr. Ramey said.
“Luxury is craftsmanship,” he said. “These types of things happen, particularly when brands are on the cutting edge of technology.
“Most clients are pragmatic and understand that a finely-tuned machine has potential for issues.”
BMW X6 xDrive 50i
Proceed with caution
While it is unlikely that the recall will affect BMW’s image over time, the automaker must carefully interact with consumers during the inspection process.
Experts agree that the recall is essentially an annoyance to consumers and the automaker should take this time to provide extended service.
This may shape future consumer interactions with the brand.
“Recalls can rarely help a brand, except to the extent that they are handled well,” said Ron Kurtz, president of the American Affluence Research Center, Atlanta., “They can potentially hurt a brand if there is a large number of cars involved, if there are serious safety risks and if the situation is not handled properly.”
The emission issue is an environmental concern and not an immediate safety risk to consumers.
In fact, the automaker may please environmentalists with its proactive recall, per Mr. Kurtz.
BMW may want to put a positive environmental spin on this and state that the brand is committed to keeping vehicle emissions output as low as possible, per Mr. Prosser.
“Consumers realize that no car company builds a perfect product,” Mr. Prosser said. “They both can get through it without a lot of drama.”
“Hysteria is what every automaker fears with recalls,” he said. “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 and it took years for memories to fade and the company to recover.”
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