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Motor vehicle recall: Things to be aware of

by ET Bureau Posted on 26 Jun 201311,321 Views4 Comments

Siam's guidelines state that a car manufacturer should recall vehicles if defects are detected within seven years of the date of manufacture



Toyota Fortuner




In April this year, 34 lakh cars were recalled across the world by four Japanese automakers ”Toyota, Honda, Nissan and Mazda” to repair faulty airbags that were supplied to them by a single company, Takata Corporation. While this is for the par in other countries, vehicle recalls are still a novelty in India, which witnessed its first major one in July last year, when Ford Motors recalled 1.28 lakh cars.


This was a deviation from the earlier practice, where customers were informed directly about faulty parts as companies feared bad publicity. While India does not have an official vehicle recall policy, Ford took the step after a voluntary recall process initiated by the apex body of automakers, Society of Indian Automobile Manufacturers (Siam), the same month.




Renault Fluence




Siam's guidelines state that a car manufacturer should recall vehicles if defects are detected within seven years of the date of manufacture. Car companies should provide information about recalls not just to the customers but also the government. Nearly 2 lakh cars and 11,500 bikes have been recalled in the country since Siam's voluntary recall code was adopted.


In the past month alone, three carmakers ”Nissan, Toyota and Renault ”have announced the recall of about 30,000 cars for various faults. Siam's guidelines are for a voluntary recall and it is up to the car manufacturer to decide whether the number of affected vehicles is sufficient to justify such a recall. Considering the cost involved and the impact a recall has on the brand image, some companies may be reluctant to announce one.


This is why the government is contemplating a nodal body, which will administer safety and other issues for the automobile industry. A government-mandated recall policy will make legal compliance more stringent and also impose a penalty on carmakers who opt for a recall. The penalty could be at par with globally.

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