How to Handle a Car Defect

Photo courtesy Porsche USA

Car defects are back in the news in a big way right now, what with Toyota paying out a huge amount for covering up the unintended acceleration problem and still facing criminal charges in the United States. There's also GM and the drama surrounding the faulty ignitions it has done nothing about for over a decade. Both have been hot-button topics in the automotive world and even at office water coolers, considering a humongous chunk of the United States drives either a Toyota or GM vehicle.


With the events unfolding around the two huge automakers, other companies seem overly eager to keep their house in order. Honda just announced a recall on its third generation Odyssey minivans, while Porsche ordered a rather notable recall on the 2014 911 GT3.

The Porsche recall is particularly interesting. Several months ago, it hit the media that the new GT3s were spontaneously combusting. Instead of ignoring it or blaming owners (like a certain Italian automaker) Porsche actually contacted all owners of the 2014 GT3 and told them to stop driving the car until the company could get to the bottom of the problem. The German automaker could have easily swept the whole issue under the rug and tried to play dumb, but instead it got to the heart of things and took full responsibility for the problem. As a result, as far as I've read, nobody has died in a smoldering 911 GT3, which is far from the case with out-of-control GM or Toyota vehicles. Porsche also recently announced that the problem is with the engine, and so the company is replacing all of the engines in the models already made.

Wow.

That's not going to be cheap for Porsche, but it's worth it. Considering Toyota is paying out a $1.2 billion settlement to the U.S. Justice Department and will undoubtedly face more consequences for not addressing the fault in its cars, I would argue that facing the music in the end is probably cheaper. What kind of damage has been done to Toyota's reputation? There's a way to innumerate it, but we'll have to see how sales perform versus the market to get an exact dollar amount.

You'd think that after the whole Ford Pinto fiasco in the 1970s other automakers would've learned to not make the same mistake. In my experience, some executives become too big for their own britches and think they can do what they will. I've had this impression about Toyota for some time now, and we all know too much about "The GM Way." What ultimately happens to GM since the problem cropped up in the pre-bankrupt company will be interesting, because the company might be shielded from forthcoming consequences, except that now more consumers will be less willing to trust anything wearing that nice little GM badge.