GM Recalls: Will Customer Loyalty Outweigh Common Sense?
For GM's new CEO Mary Barra, 2014 has been a trying year so far. During her tenure, the company has been forced to recall more than 20 million vehicles due to faulty ignition switches. Tragically, the problem has led to at least 13 deaths, possibly many more. This is in addition to a recall started in March of 2014 for power steering issues, bringing the total number of recalled vehicles to over 12 million worldwide. Recalls alone are bad enough. But a recently uncovered company memo reveals that the company may have known about the ignition switch problems as far back as 2002. All of this conjures up images of greedy execs smoking $500 cigars and callously disregarding public safety. The trial lawyers are already lining up to take a piece out of the giant automaker. Meanwhile, worries are emerging that the company's newfound commitment to quality may have simply been a brief flirtation. It's enough to make a Ford enthusiast smirk and say, "I told you so!" PHOTOS: See More of the 2014 Chevrolet Camaro 1LE
A rational observer might conclude that the debacle is proving disastrous for GM. But said onlooker would be wrong. GM sales are up sharply from 12 months ago and the company forecasts steadily increasing market share for the foreseeable future. In light of these strange contradictions, it only makes sense to ask whether consumers are either badly uninformed or simply out of their minds. After all, automobiles are pricey investments, and they're getting more expensive all the time. So why do buyers seem so undisturbed by the GM recalls? There are many possible answers to this question, such as the following.
The "optimism bias" - this is a well-documented human trait that explains why people are able to blithely go on smoking, eating Big Macs, and riding motorcycles without helmets, despite volumes of evidence proving that these behaviors greatly increase the risks of early death. In a nutshell, it's summed up by the phrase, "I know that stuff happens, but not to me." We all had this view of life as teenagers, when we said and ate and smoked and did whatever we pleased. But, while it dissipates as we grow older, for many it never quite goes away. This may explain why we assume that, while other people's air bags might fail, ours will work just fine, if we ever need them at all.
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Brand loyalty - this is another human trait that compels us to stick with what we know, even if what we're familiar with occasionally lets us down. It's partly due to fear of change, but it's also based on positive qualities that helps couples, families, and even nations endure through hard times.
The "dealer effect" - for millions of car owners, the company isn't some giant, impersonal behemoth in Detroit, but rather a local firm that they have known and trusted for decades. They see the owner and sales people in their community stores, wave to them as they drive by, and may even go to church with them. This may lead an otherwise hesitant buyer to say, "I'm going to stick with GM. After all, I've been buying from ol' Joe for 25 years and he hasn't done me wrong yet."
Crisis burnout - the media loves to scare us. If they're not sounding the alarm about killer bacteria or melting ice caps, then they're talking endlessly about vanishing airplanes or the latest Washington scandal. With so many things to be terrified of, news of product recalls may simply sound like the latest threat to human existence - the third one the news has talked about this week. And, since these doomsday predictions never seem to come true, why worry about whatever is going on with GM? Right?
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Don't Worry, be Happy
In the end, the public reaction to the GM recall may simply be an expression of that most American of qualities: unsinkable optimism. This is one trait that, despite its flaws, is essential to our national character. After all, it's hard to settle a continent or go to the Moon if you're scared to go out your front door. Of course, sometimes it may lead us to take unwise chances; but it also drives us to greatness. So in the end maybe it all evens out.
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