If you've been watching the news recently, your dealership likely has some concern about how to deal with recalls. Congressional hearings and current recall figures show that up to 50% of the vehicles on the road today could potentially have recalls just for Takata airbags, not to mention other equipment manufacturers. Dealerships need to take steps to protect themselves and their customers.
It's estimated that one in every six vehicles on the road today have unrepaired recalls; that's around 40 million cars. You can't stop taking these vehicles in on trade; it would kill your ability to do business. With the FTC watching, you don't want to resell the vehicle without fixing the recall, which is another headache all by itself if you're not certified by the manufacturer. It's a conundrum.
The FTC recently filed Consent Orders for three of the largest auto dealer groups in the US including CarMax. The CarMax Order requires the dealer to repair all recalls before selling an automobile, inform their clients how to check for unrepaired recalls on a used vehicle and inform all their clients that some vehicles may have recalls which weren't repaired. While the dealer received no direct fines but the notice to their clients, which is an estimated $400k to $600k expense based on sales reports, it did suffer a substantial penalty. This doesn't include the loss of revenue and reputation from the negative news. One dealership, Earl Stewart Toyota, has drawn a line in the sand with recalls. Putting 100 autos in storage until the recalls can be repaired was a moral decision from a man who said he wouldn't drive one of those vehicles himself.
Recalls are a big issue and none of you want to be on the front page because one of your customers is the next victim of a faulty Takata airbag. So what do you do? The first thing is to formulate a written policy and standard procedure for recalls. Taking steps to protect your consumers goes a long way in the public eye and in the mind of an FTC investigator. Next is to sign up for a service to help protect you and your customers. There are a few solutions which can help you, including Recall Check by ProMax.
Recall Check features daily monitoring that happens automatically, and you can access all open vehicle recall data with just the click of a button in ProMax or ProMax Mobile. It's easy to use and fully integrated into all pertinent Desking, Inventory, and Compliance modules. Any time you enter a trade, that VIN is automatically checked for open recalls. All recall information is accessible on the Open Recall Report: here you can designate vehicles as 'Do Not Sell', see whether parts are available, and track the progress of recalls you have decided to take care of.
If you want to know more about how to keep your clients safe and protect your dealership, call your Dealer Support Specialist at 844-322-9034.