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Industry to unveil voluntary auto recall policy tomorrow

Source : BUSINESS_STANDARD
Last Updated: Sat, Jun 30, 2012 18:40 hrs

The Indian automobile industry is set to unveil a voluntary code for recalling automobiles with manufacturing defects on Monday. Currently, unlike its counterparts in the United States, Europe, China and Japan, the Indian automobile industry does not have any statutory mechanism for vehicle recalls.

The policy would stipulate the conditions and procedures to be followed by car makers on detecting manufacturing flaws. It would also state the guidelines for resolving engineering issues related to safety and the smooth functioning of vehicles.

Also, it would chalk norms for communicating the detected technical irregularities to consumers and notified authorities, according to people in the know.

As of now, India car companies are under no obligation to recall vehicles in the country, even in case of consumer complaints on any particular product.

V G Ramkrishnan, senior director (automotive and transportation), South and West Asia, Frost & Sullivan, said, “Earlier, not too many global models were available in India and recalls were rare. But with the industry growing in size, it is only a matter of time before the government attempts to put in place stringent regulations to monitor manufacturing processes and address consumer complaints related to automobiles.

This is a pro-active and a pre-emptive initiative on the part of manufacturers to address those concerns.”

In the United States, the National Highway Traffic Safety Administration (NHTSA) probes consumer complaints regarding technical irregularities in vehicles.

Though manufacturers are permitted to contest the findings of the NHTSA, upon notification by the body, it is mandatory for car companies to recall and fix faults in specified vehicles (of a certain batch).

In China, according to the Regulations for the Administration of the Recall of Defective Automobile Products (notified in October 2004), consumers can register complaints about a defective product with government authorities, manufacturers, sellers, importers or car rental companies.

Car manufacturers selling defective products with the intention to deceive are, in addition to the obligation of a product recall, subject to a fine of ¥10,000-30,000, depending on the seriousness of the case.

MAJOR AUTO RECALLS IN INDIA
Company Models recalled No of units Date
Honda Siel CR-V, Accord 4,000+2,300 2007
Honda Siel City 8,532 Jan-10
Maruti Suzuki A-Star 100,000 Feb-10
Honda Siel City 57,853 Feb-11
Maruti Suzuki Dzire, Swift, Ritz 13,157 Apr-11
Honda Siel City 72,115 Sep-11
Instances where the car makers re-engineered/replaced faulty parts of cars but did not term them as 'recall'
Company Model No. of vehicles Year
M&M Stallio - Oct-10
Tata Motors Nano 140,000 Dec-11
Toyota Kirloskar Etios sedan 41,000 Dec-11

In recent years, the burgeoning Indian automobile market has seen a rise in the frequency of engineering flaws in new-generation cars, raising concern on the safety of passengers. In September 2011, Honda Siel had recalled 72,115 units of the City to replace faulty power window switches. This was preceded by the country’s largest car maker, Maruti Suzuki India Limited, recalling 13,157 units of compact cars Swift, Ritz and the Dzire sedan to inspect and fix engine defects.

In November 2010, Tata Motors had voluntarily decided to install additional safety features in at least 70,000 units of its small car Nano, following several instances of the car catching fire. However, the company refrained from terming the exercise a ‘recall’. Later, in December 2011, the company told about 1,40,000 Nano owners it would replace starter motors in their cars.




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