Recalls to correct defects in electronic or electrical systems—including many comfort and safety features that today’s consumers demand—have grown a staggering 30% a year in recent years. The spate of auto recalls is taking a heavy financial toll on OEMs and suppliers.
At a glance
- The frequency that suppliers are named in recall notices has doubled since 2013, and their share of total recall costs has tripled.
- Despite the mounting expenses and bad press, some OEMs and their suppliers remain preoccupied with cost reductions and innovations rather than quality.
- Companies would serve themselves well to move aggressively and reinforce advanced product quality planning now.