This blog contains posts and comments written by students in Dr. Tufte's economics classes at Southern Utah University.
4/15/2005
Honda's recall
Honda is having some problems with their ATVs. The company recalled 200,000 ATVs because of problems with steering. The company is contacting consumers that purchased the vehicles to inform them of the problems, and offer free repair. Earlier this year I read an article about Honda and their drop in sales last year. Honda is known for quality, and I wonder how this may continue to affect their future sales. I have also thought on how much consumer demand for Honda is placed on brand loyalty.
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3 comments:
As we saw in the "lemons" experiment, this is how you build a reputation for quality. You either sell something that is high quality, or you set up a warranty process that makes sure the consumer ultimately is satisfied.
So, my guess is that this isn't just brand loyalty - that Honda has a high quality strategy that they are trying to make work even when there are problems.
Dr Tufte said that you can either have quality or a warranty if you want to satisfy your costumers’ with quality reputation. The warranty is why I bought a Honda.
It isn't quality or a warranty, it is quality and a warranty. Often, quality isn't worthwhile without the warranty or guarantee.
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