Essays on GM's Strong Brand Image Rescues It after the Vehicle Recall Research Proposal

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Research Proposal The research is based on the recent GM vehicle recall due to faulty brakes on the Cadillac and other derived models, as well as GM’s 4-wheeler vehicle lines, including pickup trucks and SUVs. Research methodology Secondary Research: this will be done through websites, news articles and online forms. The aim for this research will be background study, statistics, and expert opinions. Primary Research: This will be done through a 10-question survey, given to 20 people from different backgrounds and segments that GM caters to. The responses will be recorded, analyzed and interpreted. Outcome The outcome of this research will be an in-depth look at how GM’s customers, stakeholders and competitor customers perceive GM’s image in the light of the current negative situation. Market Research – Faulty Brakes on GM Cars Introduction General Motors has the highest output in the US and comes second to Toyota, globally.

With such a large-scale operation, manufacturing issues are a given. Recently, Toyota experienced bad press due to the acceleration fault in their vehicles. GM has found itself in a similar predicament. The company has recalled over 133,000 cars for faulty brakes, which cause leakage and failure.

In addition to that, over 6.2 million trucks and SUVs are under strict scrutiny by the National Highway Traffic Safety Administration. (Staff, 2010) This paper provides a detailed analysis of the research conducted on the GM-faulty-brakes issue, through an in-depth customer survey, getting to know first-hand about what GM’s customers have to say about the recent fiasco. (Mihalascu, 2010) Research Design The aim of this particular research is to get a clear picture of the customers’ perception about GM, as a brand, in the light of the faulty-brakes issue, the company is dealing with.

As GM caters to people from every market segment in America, 20 people were surveyed, each from different socio-economic/ethnic backgrounds, in order to have a thorough and diverse set of opinions about GM. The survey was conducted in the form of a same set of 10 questions, asked from the 20 different individuals. The questions in the survey consisted of a combination of, both, open and closed-ended types. The closed ended questions were asked to get specific and definite responses to questions about product functionality and resulted in closure.

Some of these questions also consisted of ratings and scales that provide a good measure of the subject of the question. While, the open ended questions encouraged a more detailed and personal response, often consisting of examples that help the respondents express them better. The analysis consisted of judging the responses, on whether they were positive, negative, what aspects of the recent recall fiasco affected them the most and what were their thoughts and opinions about GM as a brand, after the negative events.

The interpretation provides the meaning behind the analysis; what impact did the events have on the target market, were there any differences or similarities in opinion between the different segments and what GM needs to do to address this issue. Data collection methods As mentioned earlier, data was collected through a survey. 20 people were selected from roughly 20 different segments/backgrounds, through random sampling. The 20 people in this survey consisted of customers, non-customers, shareholders and stake-holders, coming from different market segments and socio-economic backgrounds, which GM caters to, through its diverse range of brands and their products.

These were: 1. Farmers/Ranchers – GM Pick-up trucks 2. Off-roaders/Outdoors – GM SUVs 3. Corporate – GM performance sedans 4. Families – GM family sedans 5. Young drivers and enthusiasts – GM muscle cars 6. Performance racers – purpose built GM muscle cars 7. Economy/Budget – GM hatchbacks 8. Custom car enthusiasts – GM SUVs and muscle cars 9. GM shareholders 10. Other GM stake-holders. The complete list of the 20 participants from different backgrounds is attached as Appendix B. A set of 10 questions were prepared for the survey, that all participants were asked.

The participants responded to the questions separately and individually. The interview was audio-recorded in addition to the main points of the response being noted down by the interviewee. This provided a future reference to any problems in clarifications at the time of analysis and interpretation. The interview responses from all the participants are attached with this report as Appendix C, transcribed data. Analysis The survey covered just about all market segments GM targets with its wide range of products. For the first question, people who did not have GM cars and people with competitors’ cars were purposely chosen in order to have a truly diverse set of opinions.

Five out of thirteen GM cars owners had their cars recalled for faulty brakes. Of the twelve GM cars, six had been recalled for repairs, if faulty, and a quality checks, if not faulty. This is not due to the irresponsibility or carelessness by GM, but it shows the fact that not all GM models had faulty brakes. Only some Cadillac models like the CTS and its derivations, Pick-up trucks and SUVs were recalled for repairs and/or checkups.

(Lacman, 2010) Most of the respondents rated GM’s customer services as ‘good’ or ‘average’, with only three opinions of ‘below average’. This is a good indicator, despite the product recall and shows that GM is handling the problem well, in terms of dealing with the functional fault. In terms of automobile build quality, majority of the respondents rated it to be ‘good’, with ‘average’ coming second and ‘excellent’ third. GM is highly rated as a good performer, with majority of the respondents rating it to be either ‘excellent’ or ‘good’.

Respondents were asked to rank GM and its competitors, including Ford, Toyota, Honda, and Chrysler. 14 of the 20 respondents ranked GM as number-one and Toyota and Ford tied in at three each. Fourteen of the twenty respondents said that they would consider/opt for a GM automobile for their next purchase. Despite the product recall, it is evident that Americans still have good perceptions about their local automaker. There can be a number of reasons for this choice as well; 1. Toyota’s recent mass recall, refuting the claim that Japanese cars are always better than American cars 2.

The value for money that the American cars offer. 3. The consumer mind-set of “be American, buy American”. When asked whether recall was the best option against others, most of the respondents had the same opinion, which was in favor of recalls. This shows that the customers are satisfied with the way GM is dealing with the current situation. This response acts as an indicator towards the positive attitude of the customers, towards GM, observed in the earlier questions.

(News, 2010) The last two questions were left open ended, so that the respondents can freely express their views about GM and their choice, as well as what they honestly thought about the recall scenario. Most of the respondents, who chose GM, did so, on the basis of good performance, good value for money and reliability/toughness. (Belsie, 2010) The last question enabled the respondents to recommend actions and measures that they thought GM should practice during the recall situation. The general opinion was the fact that GM needs to take responsibility and admit their fault, addressing the issue and practicing good customer services at the same time.

But the main focus was on process improvement, behind the scenes. The customers wanted GM to change things and evolve, streamlining processes and enforcing strict quality control. Interpretation Although GM was going through a tough time with product quality issues, safety issues, several mishaps with accidents and crashes caused due to the faulty brakes, GM customers did not attack the company viciously. GM has built its brand image over the years and has a strong presence in the minds of the customers.

The traits that they associate it with include good value for money, performance, toughness and reliability. These things, in addition to the pride of being an American automaker, have strengthened the brand’s relationship with its customers. Such a strong relationship has its perks during tough times, as we have seen through this survey. Although GM customers are loyal and are satisfied with the way their faulty products are being dealt with, they also emphasize on the need for improvements and strict quality control measures.

GM has benefitted from its strong brand image and good customer relations, but repeating the same mistakes might not be an option. (AA1Car, 2005) Conclusion Large automakers often face quality and manufacturing issues. GM is no different. A market survey revealed that despite GM’s fault, its strong brand image and instant response in the form of product recall and checks, have controlled the amount of damaged caused to the company. In the future, GM will have to act differently. The customers, although forgiving, demand improvements, strict quality control and communication of the changes to the general public.

If GM continues to gives its customers what they want, it can retain its market share and strong positioning. References AA1Car, C. (2005, 7 30). GM RECALLS 800,000 SUVs with ABS Anti-Lock Brake Problem. Retrieved 5 15, 2010, from AA1Car: http: //www. aa1car. com/library/gm_suv_recall. htm Belsie, L. (2010, 3 2). GM recall: What to do if your Chevy or Pontiac is on the list? Retrieved 5 15, 2010, from CS Monitor: http: //www. csmonitor. com/Money/new-economy/2010/0302/GM-recall-What-to-do-if-your-Chevy-or-Pontiac-is-on-the-list Lacman. (2010, 4 6). NHTSA investigating 6.2 million GM trucks/SUVs over faulty brake line - By Mark Kleis.

Retrieved 5 15, 2010, from Auto Spies: http: //www. autospies. com/news/NHTSA-investigating-6-2-million-GM-trucks-SUVs-over-faulty-brake-line-By-Mark-Kleis-53134/ Mihalascu, D. (2010, 4 9). 6.2 Million GM Pickup Trucks and SUVs under Investigation for Faulty Brakes. Retrieved 5 14, 2010, from Auto Evolution: http: //www. autoevolution. com/news/62-million-gm-pickup-trucks-and-suvs-under-investigation-for-faulty-brakes-19015.html News, 4. (2010). NHTSA to investigate 6.2 million GM vehicles over brake line corrosion. Retrieved 5 14, 2010, from Carbuzz: http: //www. carzbuzz. com/story/nhtsa-to-investigate-62-million-gm-vehicles-over-brake-line-corrosion Staff, A. (2010, 3 22). GM Recalling 130,000 Cars For Brake Problems. Retrieved 5 14, 2010, from AOL Autos: http: //autos. aol. com/article/cadillac-cts-brake-recall/ Appendix A – Topic Guide Secondary research: internet articles, news, automobile blogs, GM website. Information on statistics, specific vehicles that the problem is associated with and the current measures by GM and the NHTSA. General perception of GM as a brand: ratings, rankings, product experiences, brand personality, associations and competition. Views and opinions about the faulty brakes: personal experiences, opinion about the service, effects on their brand perception, purchase and usage.

Inconvenience caused by the product recall. Recommendations by the participants: what they think GM should do about fixing the functional problem, is recalling products the right solution? What should GM do to recover from the damage done to its image? Appendix B – List of Participants 1.

James McCullen – 52 years old. Ranch owner. Owner of two Chevrolet Silverado and one GMC Topkick trucks. 2. David Anderson – 35 years old. Training supervisor at a bank. Owner of a 2009 Cadillac CTS. 3. Christopher Hartfield – 42 years old. Real estate agent. Owner of a Chevrolet Lumina SS, as a family car. 4. Jennifer Andrews –21 years old. College student and muscle car enthusiast. Owner of a 2009 Chevrolet Camaro SS. 5. Michael Rutledge – 27 years old. Software engineer and part-time performance dragster. Owner of a 2008 Hennessey Corvette. 6.

Catherine Bay – 31 years old. Food catering service owner. Owner of a 2009 GMC Yukon 7. Anthony Jackson – 33 years old. African-American. Hip-Hop music production partner. Owner of a custom Hummer H2 8. Jeremy Owens. 65 years old. Retired Insurance Sales Manager. Owner of Chevrolet Aveo sedan. 9. Ruth Lister. 18 years old. High-school student. Owner of a Chevrolet Aveo Hatchback. 10. Adam Wright. 17 years old. High-school student. Owner of a 2008 Pontiac Solstice. 11. Asif Akhtar. 35 years old. Construction contractor. Owner of a 2008 Chevrolet Avalanche. 12. Peter Wong. 25 years old.

Auto-electronics shop owner. Owner of a 2008 Pontiac G8. 13. Emily Fox. 28 years old. House-wife. Owner of a Ford Fiesta. 14. John Robins. 26 years old. Customer Service Executive. Owner of a 2009 Ford Mustang GT. 15. Lorenzo Johnson. 25 years old. Supermarket sales supervisor. Owner of a 2008 Honda Civic. 16. Robert Patterson. 16 years old. High-school student. Looking to get his first car. 17. William Henning. 32 years old. GM stockholder. 18. Vincent Taylor. 35 years old. Ex-GM Dealership Salesman. 19. Russell Nelson. 32 years old. Car repair shop representative. 20. Suneel Gupta.

43 years old. Finance Manager. Appendix C – Transcribed Data This section contains the interview data collected and transcribed from the 20 different respondents. A question is stated, which is then followed by 20 different responses. This format is followed for all questions. 1. If you own a GM automobile, have you experienced any trouble with your braking system? James: Yes, in one of my Silverados. The other two trucks are under check. David: Yes, the brakes were getting weaker and slipped as well. Christopher: No, the brakes are working fine. Jennifer: No trouble at all. Michael: No, my car has after-market ceramic brakes.

Catherine: Yes, they were causing some trouble. Anthony: Not at all. Jeremy: No. Ruth: No. Adam: No trouble with my brakes. Asif: Yes, the brakes failed twice and there was some leakage where the brakes were in contact. Peter: Brakes work great. Emily: Don’t own a GM car. John: Don’t own a GM car. Lorenzo: Don’t own a GM car. Robert: Don’t own a car. William: Don’t own a GM car. Vincent: Don’t own a GM car. Russell: Don’t own a GM car. Suneel: Yes, the brakes are causing trouble. 2.

If yes, has your car been recalled for repairs or has the issue been addressed by GM in any other way? James: Yes David: Yes Christopher: Yes, for inspection. Jennifer: - Michael: - Catherine: Yes Anthony: No Jeremy: Yes Ruth: No Adam: No Asif: Yes Peter: No Emily: - John: - Lorenzo: - Robert: - William: - Vincent: - Russell: - Suneel: Yes 3. How would you rate the customer service response received from GM? Poor, Below Average, Average, Above Average, Good or Excellent? James: Good David: Good Christopher: Excellent Jennifer: Good Michael: Good Catherine: Average Anthony: Average Jeremy: Below Average Ruth: Average Adam: Good Asif: Average Peter: Good Emily: Average John: Below Average Lorenzo: - Robert: - William: Good Vincent: Good Russell: Average Suneel: Below Average 4.

How would you rate GM in terms of automobile quality? Poor, Below Average, Average, Above Average, Good or Excellent? James: Good David: Good Christopher: Good Jennifer: Excellent Michael: Excellent Catherine: Good Anthony: Excellent Jeremy: Good Ruth: Average Adam: Good Asif: Below Average Peter: Good Emily: Average John: Average Lorenzo: Average Robert: Good William: Good Vincent: Average Russell: Good Suneel: Poor 5. How would you rate GM in terms of Performance?

Poor, Below Average, Average, Above Average, Good or Excellent? James: Excellent David: Excellent Christopher: Excellent Jennifer: Excellent Michael: Excellent Catherine: Good Anthony: Excellent Jeremy: Average Ruth: Average Adam: Good Asif: Good Peter: Good Emily: Average John: Below average Lorenzo: Average Robert: Good William: Excellent Vincent: Excellent Russell: Good Suneel: Average 6. How would you rate GM among competitors? 1 being the highest and 5 being the lowest. GM, Ford, Chrysler, Toyota and Honda. James: GM, Ford, Chrysler, Toyota, Honda David: GM, Ford, Toyota, Honda, Chrysler Christopher: GM, Ford, Toyota, Honda, Chrysler Jennifer: GM, Toyota, Honda, Ford, Chrysler Michael: GM, Ford, Toyota, Honda, Chrysler Catherine: GM, Ford, Chrysler, Toyota, Honda Anthony: GM, Ford, Chrysler, Toyota, Honda Jeremy: GM, Ford, Toyota, Honda, Chrysler Ruth: GM, Ford, Toyota, Honda, Chrysler Adam: GM, Ford, Toyota, Honda, Chrysler Asif: Ford, GM, Toyota, Honda, Chrysler Peter: Toyota, Honda, GM, Ford, Chrysler Emily: Ford, GM, Toyota, Honda, Chrysler John: Ford, GM, Toyota, Honda, Chrysler Lorenzo: GM, Ford, Toyota, Honda, Chrysler Robert: GM, Ford, Toyota, Honda, Chrysler William: GM, Ford, Toyota, Honda, Chrysler Vincent: Toyota, Honda, GM, Ford, Chrysler Russell: GM, Ford, Toyota, Honda, Chrysler Suneel: Toyota, Honda, GM, Ford, Chrysler 7.

Would you opt for a GM automobile for your next purchase? James: Yes, I would love to. David: No, but I don’t hate GM Christopher: Yes, I would. Jennifer: Yes, definitely. Michael: Yes. Catherine: Yes, I would consider it. Anthony: If it is a good car, Sure. Jeremy: No, I want something different. Ruth: No, I want an import, next. Adam: Yes, I want a muscle car, next. Asif: No, I would go for an Import. Japanese. Peter: Yes, why not? Emily: I could consider a good model, yes.

John: No, Ford all the way! Lorenzo: yes, I don’t see any reason why not. Robert: Yes, I want a Camaro. William: Sure, Why not? Vincent: Yes, I would. Russell: Yes, if I can afford one. Suneel: No, I have had a bad experience with GM products. 8. What would have been a better option than recall, to address the faulty-brakes issue? a. Free repairs at the nearest service center b. Vehicle Replacement c. No, recall is the best idea d. Other James: No, recall is the best idea David: No, recall is the best idea Christopher: Free repairs at the nearest service center Jennifer: No, recall is the best idea Michael: No, recall is the best idea Catherine: No, recall is the best idea Anthony: No, recall is the best idea Jeremy: Vehicle Replacement Ruth: No, recall is the best idea Adam: No, recall is the best idea Asif: Free repairs at the nearest service center Peter: Free repairs at the nearest service center Emily: No, recall is the best idea John: No, recall is the best idea Lorenzo: No, recall is the best idea Robert: No, recall is the best idea William: No, recall is the best idea Vincent: No, recall is the best idea Russell: No, recall is the best idea Suneel: Vehicle replacement 9.

What is/will be the reason for choosing/not choosing a GM automobile? James: Built tough, American built, good after-sales service David: Great performance and good value for money Christopher: Good value, good performance, reliable Jennifer: Great performance, great looks, good value for money Michael: Great performance, great looks, American, lots of customizing options Catherine: Good value, good performance, reliable Anthony: Great quality, performance, customizing options, luxurious, popular Jeremy: Good value, good performance, reliable Ruth: Good value, small, economical, and convenient.

Adam: Great looks, great performance, good value for money. Asif: Tough, good performance and not expensive. Peter: Great looks, great performance, good value for money. Emily: Ford was offering better value for money John: Ford offers better performance, toughness, reliability, value and quality. Lorenzo: Japanese cars are better built than American. Robert: Great looks, great performance, popular. William: Lacked that luxury option that European cars offer. Vincent: Sold my Chevy after I left GM. Personal issues. Russell: Great looks, great performance, good value for money. Suneel: American cars lack quality and reliability. 10.

What does GM need to do as a responsible brand, in order to address this issue for sub-quality/faulty parts and manufacturing? James: They need to face the public and admit it. Then they need to take responsibility and fix the problems. That is fair enough. David: GM needs to re-engineer its processes and improve. But the problem lies behind the scenes, where it all matters. Christopher: I think GM needs to face the people and admit their faults. The recall system works, but they also have to promise the people that the same mistakes won’t be repeated and that they will continue to give people what they have for decades; good reliable American cars.

Jennifer: GM is taking responsibility and addressing the issue in a classy manner. These things happen and with more improvement and learning from experience, I think GM will bounce back from the negativity. Michael: GM knows what to do. They’re doing the right thing with the product recall and the NHTSA scrutinizing the cars for any faults. I think these organizations handle the damage well.

Catherine: GM needs to strengthen their quality control department and make sure that only the best products leave the production line. Anthony: I think they’re doing the right thing. They need to learn from the mistakes. If they do that, the customers will be forgiving. Jeremy: They need to gain back the customers’ trust. Apart from repairs and recalls, they should communicate the positive measures that will prevent this sort of thing happening in the future. Ruth: GM needs to take responsibility and fix the faulty products.

Adam: These sorts of things happen. GM needs to take responsibility and face the people bravely. If they have confidence, the people will believe in them. Asif: GM needs to learn from other better companies like Toyota. They need to adopt newer methods and improve quality control. Peter: GM needs to improve their standards and enforce quality control at the supplier level. Emily: They need to improve their processes and ensure quality. John: it’s simple; GM needs to improve and communicate those improvements to the customers. Lorenzo: GM is far behind the Japanese and their streamlines processes.

They need to learn and change their ways in order to improve. Robert: They need to take responsibility and fix the mess. William: GM is doing its best, although, they need to take strong measures to avoid these things in the future. These events can seriously damage the company’s image bother market wise and financially. Vincent: They’re doing what they do. The problem lies at the back end. Suppliers need to be changed. Russell: They need to ensure quality; not only in their own factories but also from the people who supply them parts. Suneel: GM needs to learn and change their ways.

They need to realize that the same old American philosophy of building what the company wants, doesn’t work anymore.

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