As hard as we try to increase recall completions, there always seems to be a bump in the road. We may soon be in for a pretty big one from the used-car market and there are plenty of signs pointing to this having a major effect on both dealerships and consumers.

According to a recent article in Automotive News, here are four ways the scenario could play out:

1.   Rental Car companies filing bankruptcy – Federal law prohibits rental car companies from renting vehicles to consumers with open safety recalls. This was great for consumers as rental car companies had to complete the safety recall before they could get that vehicle back in service. In turn, consumers could rest assured that the rental vehicle was safe.

However, it is now expected that these bankrupt rental car companies will be forced to relinquish or liquidate their fleets due to a lack of travelers and reduced income. It is still NOT against the law to sell a used vehicle with an open safety recall. So, should the rental car companies go that route, these vehicles may ultimately end up in the ownership of consumers. And it is also likely that they will be sold with existing recalls left unrepaired. Considering that rental agencies account for 20-30% of all vehicle sales from manufacturers, that will be a lot of vehicles back on the road.

2.   Lease Returns and Repossessions – Recent circumstances have prevented consumers from returning leases after their maturity dates. Also, some consumers can no longer make payments on their vehicle loans. While most financial institutions work with these consumers, ultimately the bill will come due and leased vehicles will get grounded. This is another potential large group of vehicles that could end up in-market as used car inventory which is not required to have open safety recalls completed before sale.

3.   Wholesale and Auction Houses – Many dealerships that were forced to close will now open with a slew of vehicles destined for wholesale and/or auction houses. The scramble to unload these vehicles could further exacerbate the glut of available vehicles on the market which may end up in small used-car lots, buy-here-pay-here lots or independents.

4.   Dealer inventory – Similar to point #3, dealers could also have an inventory of front-line retail used vehicles they need to unload. A franchise dealer selling an off-brand used car may find it easier to simply sell it to a consumer, rather than sit on that vehicle until the safety recall can be completed and have the customer sign a disclosure stating that a recall exists (which has become more common lately).

These circumstances combined could very easily result in a glut of inventory across the board but, more importantly, a glut of used vehicles back on the road with open safety recalls. Hang on to your hats because this wild ride will probably get wilder before all is said and done. 

In my last blog, I shared some tips about how dealerships can help protect customers and staff in their service departments during this challenging time. In addition to having the precautions in place, it is important to know how to correctly communicate to your customers (or prospective customers with safety recalls) about these safety measures and the importance of completing any needed recall work.

Consumers are venturing outside for some essential tasks such as trips to the grocery store, traveling to assist a family member, or to their place of work as an essential worker. They still need the use of their vehicle and, if it has an outstanding safety recall, it could inhibit them from doing these essential tasks or place them in danger.

Here are some tips we have found to be successful for service departments at this time.

This data needs to be communicated to your customers correctly. Display this data prominently on the service section of your website and in your service advertising. Also, use it in your emails, texts, and phone calls.

1. 1. Communicate that your service department is legally open and ready to service them

First, let your customers know that your service department is considered an essential business and you are open and ready to service them. They may not even know this.

1. 2. State the safety measures you are taking in all your communications

Tell your customers that their well-being and safety are your top priority, especially during this challenging time. That you understand their vehicle is a vital link to critical health services, medication, and groceries. As such, you are committed to remaining open to offer expedient and safe vehicle servicing and maintenance.

Reassure your customers that to protect them you are adhering to all CDC guidelines and offering additional vehicle disinfection at vehicle drop-off and return. These added measures, which will come at NO COST, are in place during the COVID-19 outbreak to ensure their health and peace of mind.

1. 3. Develop a COVID Action Plan offered free to customers to make them feel safe

I also recommend that you offer something along the lines of a “COVID-19 Action Plan: FREE to all Service Customers.” Several service departments are using this to great success.

They generally include such things as:

* Your vehicle safely returned to you, disinfected before and after service

* Pickup and delivery to your home and office is available within a 15-mile radius. Services available during operating hours.

* For consumers who prefer to drop off/pick up at the dealership, strict social distancing observed in our service drive

* For extended repairs, a disinfected loaner car will be made available

1. 4. Correctly communicate the additional threat of unrepaired recalls

Let your customers know that unfortunately, the coronavirus is not the only threat in the world. More than 1 in 4 vehicles on the road today have an unrepaired safety recall, a government-mandated warning intended to safeguard consumers. If you have a recall check tool on your site, be sure to include a link to it in your texts and emails and make sure it is easy to find on your site. Urge your customers to attend to the recall as soon as possible.

1. 5. Inform your customers of the future increase in parts shortage

Communicate to your customers that you expect a disruption in the global supply chain to cause a parts shortage. It is a real possibility that in 3 months replacement parts will not be available. Advise them to please take immediate action. Again, state that all recall repairs and disinfection come at NO COST. This isn't a marketing ploy – it's a very real scenario that will likely play out, especially with imported parts.

1. 6. Offer a discount to help with expenses

Finances can be tough right now, so to assist with expenses, consider offering a discount such as a $50 dealer services gift card. The gift card can be applied to any additional services or parts.

1. 7. Contact information and hours are important

Include all methods of contact for your service department and your hours. You would be wise to add online scheduling, if you do not already have it, and include a link for ease of scheduling.

1. 8. Charities need help now more than ever and charitable messages can help too

If you are doing anything right now to support your local community include that and encourage your customers to help with a message such as, “It is times like this that bring the best out in all of us. ABC Dealer is a proud sponsor of the Give Back to ABC Community Outreach program, which provides meals and services to seniors in our community. If you would like to help or contribute, please visit www.SomeTownshipHelp.com/coronavirus.”

With 33 states prohibiting the sales of vehicles in some form, now is the time to reach out to consumers for service work. Many dealerships have traditionally under-marketed their service departments, even though they account for the majority of income.

Safety is on every consumer’s mind right now. Communicating the message of safety for both their vehicle and general health and well-being can help your dealership gain much-needed service revenue. It can also encourage new service customers that will continue to return once this immediate crisis is over. And it is important right now to also plan for the future.

April 8, 2020, Laguna Hills, CA – Recall Masters, Inc., the leading provider of automotive recall data, technology, and communications, today announced the launch of a special COVID-19 Response Kit at no cost for its auto dealer clients. The kit is designed to help improve the handling of service customers and recalls at this time.

“It appears that, as a country, we're moving past the immediate response to the COVID-19 outbreak and settling into a new normal for the next 30-60 days, if not longer. While the impact is unique to each dealer and local market, we stand united in supporting consumers who continue to rely on their local dealership for vehicle service. For stores that remain in operation, we are here to help. We've received some optimistic feedback from certain programs which are now available to our dealers at no additional cost,” said Dan Beres, Managing Partner at Recall Masters.

The Recall Masters COVID-19 Response Kit is offered at no additional cost to all current auto dealer clients and any stores within a group where one or more stores is a client. It includes the following:

1. MarketSMART Reports: These reports identify recalled vehicles on independent lots. Because sales have come to a standstill, Recall Masters has found that independents are now very receptive to vehicles being serviced by a franchised dealer. For a limited time, Recall Masters is making these reports available at no cost to its clients and all stores within the store’s group.
2. Group Inventory Batch Upload Reports: These reports identify recalled vehicles sitting on lots of dealers’ sister stores. For a limited time, if a dealer provides the VINs in its group's used car inventory, Recall Masters will check them for open recalls and return a report detailing which vehicles are affected by a recall.
3. COVID-19 Response Communication Campaign: In addition, Recall Master is offering a special COVID-19 Response Communication Campaign at no cost to its auto dealer clients. Dealers must fill out a questionnaire profile of their COVID-19 operations, and Recall Masters will coordinate communication with consumers who require vehicle servicing and repair (see sample email here).

Recall Masters dealers who are interested in a special COVID-19 RESPONSE communication campaign at no cost can click here.

Recall Masters has also drafted a best practices guide for using these tools, along with suggested call scripts, which can be accessed at https://bit.ly/2V9h2hV.

“With staff cutbacks, many dealerships lack the resources to craft and distribute important updates to customers. And a key part of any workable solution right now is effective customer communications. At the best of times, recall customers can be upset about an existing recall, especially if their vehicle is now unsafe and a threat to them and their family. Add the threat of COVID-19 and the fear is even greater. It is vital to communicate with these customers correctly to help soothe any fears. For example, let them know you are adhering to all CDC guidelines and offering additional vehicle disinfection at vehicle drop-off and return at no cost to the customer,” Beres stated. “We expect the majority of our customers to take advantage of this opportunity, so please be patient while we confirm your participation. If you don’t receive a response within 24 hours, please email covid19support@recallmasters.com and we will call you immediately,” Beres added.

Recall Masters provides recall solutions directly, and through strategic partnerships, to more than 3,000 dealerships nationwide. Also, two auto manufacturers, BMW of North America (BMWNA), and Mazda North American Operations (MNAO) are contracted with Recall Masters to assist with boosting recall completion rates for select dealerships in key US markets.

Any Recall Masters dealers interested in the COVID-19 Response Kit can call their representative or send an email to covid19support@recallmasters.com. 

About Recall Masters:

Recall Masters is the leading provider of automotive recall data, technology, and communications, dedicated to helping automakers and their dealers expedite the repair of recalled vehicles and make the roadways safer for everyone. Greater recall awareness and proactive recall management help automakers protect their brand and build trusting relationships between automotive dealers, rental car agencies, auto auctions and consumers alike. Recall Masters is a privately held company based in Laguna Hills, CA.  To learn more about Recall Masters and comprehensive recall management, please call 888.651.4480, email info@recallmasters.com or visit www.recallmasters.com.

Media Contact:

Sean Reyes
Chief Marketing Officer
sean@recallmasters.com
949.246.6023

Recall Masters' Dan Beres, Managing Partner, explains how dealerships are handling safety recalls. From NADA 2020.

Consumers are notoriously difficult to reach when it comes to safety, needed repairs and attending to recalls. OEM and dealer methods include everything from phone calls, to text messages and direct mail. However, far too frequently, these notifications end up in the trash and are ignored.

Perhaps there is a new way to communicate with these customers, especially those second and third-generation owners. And that is social media.

While almost every dealer utilizes social media as a sales tool, many don't want to use it as a platform to educate consumers about recalls for fear they will shy away from the message and head over to the competition. Newsflash – no brand is free of recalls and dealers are missing the opportunity to deliver a message about safety through social media.

Billions of consumers all over the world use one social media platform or another, making it easier than ever to get in front of consumers with your message. In fact, one manufacturer has jumped on the opportunity and joined this new era of transparency, with great success. A recent article in Automotive News reports that at one of the premier consumer auto events of the year, the New York Auto Show, Honda featured a Civic which crashed during official testing. Honda also encouraged current owners to share their personal stories on social media. By no means is this a strategy OEMs traditionally use at these events, which are well attended by both the public and major media outlets. However, consumers applauded Honda for their efforts, sharing their stories with Honda and, by default, the world, to positive response.

Perhaps social media is something dealers should use to inform and educate their customers about recalls which could then lead to building trust with your community and, as a result, an increase in service revenue. Of course, I entirely understand many dealers’ hesitations to publicize faults and problems by announcing to consumers that their vehicles have some issues.

But think about all the manufacturers who had problems with Takata airbags. This wasn't a manufacturer or dealer issue. Instead, Takata was the premier (and majority) supplier of airbags for most manufacturers. When the avalanche of recalls came to light, many manufacturers decided to become more transparent in other areas. And consumers forgave them.

If you inform consumers about recalls over social media, you can establish trust with your consumers and open the lines of communication. It can be an excellent opportunity to gain more customers from consumers who run across your informative recall postings. I don't believe it will hurt sales, but rather increase consumer confidence in the dealership.

Take the recent example from Honda and consider adopting a new social strategy. In the end, it can help communicate vital information to consumers and illustrate that you are you willing to talk the talk, but also ready to walk the walk. And that goes a long way to building trust and securing loyalty.

Retention is vital for long-term profitability and health. Some dealers coast along thinking they have retention covered, when, in fact, nothing could be further from the truth. Sure, offering a great customer experience in service can head you in the right direction. However, it is not just free coffee, donuts, or wi-fi access that bring customers back. Customers come back to the dealership because they trust that their vehicle will be adequately serviced at a fair price and made safe for them to drive.

Customer retention is an activity that is taken to prevent defections (i.e., going to your competition). Retention marketing includes programs and strategies that focus on growth and retention of existing customers through incentives to lure them back into the dealership for subsequent transactions. These ongoing touchpoints prevent your dealership from losing customers to the competition and enable your dealership to save money otherwise spent on customer acquisition tactics. They also increase the likelihood that these retained customers buy their next car from you.

Retention marketing programs can not only help you stay in contact with customers but can also be used to deliver valuable information at the same time. Many dealerships subscribe to and deploy a variety of marketing services designed to keep them top of mind. However, many don’t leverage these to inform customers about recalls. Perhaps they think that recall information is too broad and won’t apply to everyone. I'm sure some perceive recall communication as highlighting a negative situation. The truth is, consumers view recalls as an extension of sound safety practices.  Consumers gravitate to organizations that look out for driver safety, have product integrity, and practice proactive problem resolution.

Also, recall awareness communications can elevate your dealership’s profile.  Consumers tend to appreciate the effort and reward your dealership by servicing with you.

Many dealerships have an e-newsletter they send to customers. These same e-newsletters can easily include information about existing recalls. They are a channel that dealerships already use to communicate with their customers. By using this existing medium to share information about recalls, you can reinforce your dealership’s commitment to vehicle safety and build consumer trust for your dealer and factory brand.

Another tool your dealership can deploy is an online scheduler. Most service schedulers require (or at least ask) a customer what vehicle they are bringing in. Nobody likes surprises in the service lane.  A Service Advisor or Director can quickly review which vehicles are scheduled for the next week or so, identify those with existing recalls and call, text, or email the customer this information prior to their visit. This also helps in scheduling the appointment properly since some recalls take time to fix which means setting up alternate transportation for the customer ahead of time. 

Imagine a consumer’s disappointment if your dealership failed to catch a recall during a recent visit, and the consumer then independently discovers its existence from another source.  These oversights can chip away at your credibility and the customer’s loyalty.

Provide your customers with valuable recall information that affects the safety of their vehicles. Offer them a convenient time to get the recall handled. And at the same time, offer those service coupons you already had planned. You can easily encourage the customer to allow you to do both. 

A few simple customer retention strategies in place can help prevent defection and build loyalty. This can also reduce customer churn without spending thousands of dollars every month in acquisition efforts to replace the customers lost the previous month.  Recalls are a unique opportunity to win over new customers, retain existing customers, and drive revenue without any need for discounting. 

Several manufacturers, including Tesla, have rolled out some “innovative” features that include self-driving technology. At first glance, consumers like this type of vehicle technology because it typically means that these vehicles are fuel-efficient, use advanced technologically and are, frankly, cool. However, there are hazards involved with this advanced technology and, sadly, plenty of accidents (and deaths) are reportedly associated — some caused by human error, and some by a person’s misunderstanding of the technology.

According to an article in Automotive News, some automakers and ride-sharing companies want to go even further. Not only do they want to create self-driving vehicles, but also plan to remove the very controls that allow a human to intervene when necessary – namely steering wheels and brake pedals! 

While self-driving cars are still in their infancy, auto manufacturers are in a race to be the first to market. Several states have limitations and regulations regarding how and if these vehicles can be tested. Most of them still have the infrastructure to allow drivers to take over if needed. The argument state and local governments have put before NHTSA is that the federal government should revise current regulations to ensure vehicles also allow human interaction. Many people want a more relaxing commute and are intrigued by this new technology. However, in removing the steering wheel and brake pedals, consumers are entirely at the mercy of a computer, with no chance to manually intervene. All you can do is watch and (like in the old days of emergencies) duck and cover.

Some of this early technology – even when the driver can interact and take over – is flawed. There are sure to be recalls and technology issues that create dangerous situations. Does any consumer want to put their lives in the hands of a computer? Some already do on a smaller scale. For example, while the world is telling drivers not to text or look at their phones while driving, Tesla has huge interactive screens in some vehicles that can be just as distracting!

By taking away the ABILITY for a person to control a vehicle, manufacturers force consumers to rely on self-driving vehicles to operate safely amongst conventional human-controlled cars. Also, you must admit, they are not always operated by the most safety-conscious drivers!

Yes, technology is cool. However, while this future of vehicle technology may look and sound desirable, there are many hidden safety issues inherent to these vehicles that we should consider. As a society, it may be a good idea to try not to find self-driving technologies quite so alluring – similar to how a mosquito is attracted to a bug-zapper. The warm glow might not be so comforting, after all. The proper balance is to evaluate what technology can do for us while looking at how fail-safe it is. Can we really endure another Takata disaster?

If we fail to proceed cautiously with vehicle safety at the forefront, we could quickly end up with road rage on a robotic level. With vehicles doing their own programmed, pre-determined tasks while each manufacturers’ vehicle has different priorities.

Perhaps not the nirvana of a pleasant commute, but one of helpless commuters staring out their vehicle’s windows helplessly wondering what to do. And that is a commute that is probably not as pleasant as expected. 

According to a recent article in Automotive News, consumers LOVE the idea of all of this new in-vehicle technology. The problem is that many of them don’t truly understand the intricate features and benefits. There is no way a salesperson can explain each and every technological feature on many of today’s cars succinctly, as is the case with any technology. For example, if you have ever had a problem connecting your phone to a Bluetooth speaker, well, then you have some idea as to the challenges the average consumer has when they get that new vehicle home. With all the electronic bells and whistles installed on today’s latest models, it's easy to see how owners can struggle with their operation.

So, who does the customer turn to for a quick refresher course when they opt out of that massive owner's manual? Chances are, consumers are looking to the friendly service advisor to guide them through the maze of new in-vehicle technology patiently. Only in instances of pure desperation do consumers turn to the owner's manual. If my parents struggled with the VCR, then they're for sure going to be at the advisor’s desk seeking assistance the day after the vehicle purchase…….

Some of the questions actually have nothing whatsoever to do with any maintenance or repair issues, but rather about how to work certain vehicle features such as Bluetooth connectivity, or any number of technology features that are now standard in new cars. As savvy as we've all become with technology, our nation's population is getting older, and they're going to need some help.

For the first few days or a week after purchase, the customer may call their salesperson. But, ultimately, they will rely on their service advisor to assist them when they come in for service.

With all this new technology, there is a lot of talk about the need for technicians and, more specifically, those that are trained in this new technology. But we don’t hear too much about the need for service advisors to be trained in these features.

If a service advisor isn’t knowledgeable about the vehicle itself, it may take valuable time for a dealership technician to teach the customer. If the service advisor were knowledgeable about the most common new features and technologies, the issue could be handled in the service drive, preserving valuable technician time for the dealership. While technicians are in short supply, every minute spent away from the service bay costs the dealership.

I realize this may be a bit of a balancing act as the service advisors are very busy. I have heard of some dealers that have a team of younger tech-savvy employees who are not a huge expense, know the tech inside out and can quickly educate vehicle owners. It is excellent for CSI and customer retention. And, on the luxury side, I see more and more tech support/sales people such as BMW Genius Everywhere reps, a great program that even has an app.

If you do not have an in-dealership or OEM program like this in place, training your service advisors on the new technology features or employing a couple of inexpensive tech-savvy kids who can educate your customers, may be a great idea to streamline owner education, keep customers happy, improve CSI and customer retention. Who knows? It could even help with upsells.  If you handle the customer's Bluetooth-synching issue, they may be more amenable to those recommended repairs that need to be done!

Automotive Recall Solutions Innovator Adds Industry and Technology Leader to its Executive Team

April 23, 2019, Laguna Hills, CA – Recall Masters, Inc., the leading provider of automotive recall news, data, training, and communications, today announced the appointment of John Dunning as President. In this position, Dunning oversees all day-to-day operations, including finance, investor relations, human resources, sales, marketing, technology development, and client services. The appointment comes at a time when the recall solutions provider is growing fast and has become a top vendor in the automotive industry.

Dunning has a track record of taking new ideas and creating and implementing plans that successfully bring them to life, boosting revenue. He brings more than two decades of experience to Recall Masters as an entrepreneur, investor, and operational executive. His expertise ranges from founding CEO at Confident Financial Services (now DigniFi), currently the leading auto repair financing solution, to serving as a critical team member in several San Francisco-based software start-ups, to working as a venture capitalist. He also founded and served as CEO of two Boulder, Colorado-based technology start-ups and has served as an advisor to several software businesses. 

Most recently, Dunning ran San Juan Vacation Ventures, LLC, the largest vacation rental management agency in the San Juan Islands, northwest of Seattle. Dunning possesses a B.A. from the University of Oregon, where he studied Economics, International Studies and Spanish, and an M.B.A. from the Thunderbird School of Global Management.

“I’m very honored and excited to join such an impressive team of individuals dedicated to vehicle safety,” Dunning stated. “This is a pivotal moment, not only for Recall Masters but also for the automotive industry, state and local government and consumers. While fingers point at who is to blame for the recall crisis, Recall Masters is procuring the most comprehensive knowledgebase of vehicle owners and recall data, developing innovative technology and deploying effective communications that engage consumers and compel recall compliance. We are beyond the point where blame plays any part in helping consumers and are focused on solutions.”

With more than 1 in 4 vehicles on US roads and highways having an open recall, and another year of record recalls for 2018, the recall crisis continues to grow. Recall Masters provides recall solutions directly, and through strategic partnerships, to more than 3,000 dealerships nationwide. Also, two auto manufacturers, BMW of North America (BMWNA) and Mazda North American Operations (MNAO), recently contracted with Recall Masters to assist with boosting recall completion rates for select dealerships in key US markets

“If we want vehicles to be safer, then we need the kind of transparency that encourages auto manufacturers and the government to work together at uncovering and disclosing potential dangers, and that seems to be working. The bigger challenge is locating the current owners of these recalled vehicles and helping them resolve it before tragedy strikes. Recall compliance is almost entirely a local issue. From the dealerships that have to perform the necessary repairs, to the consumers that need to bring their vehicles in, we have a serious disconnect from what law mandates and what the consumers and dealers need at the local level. We've bridged that gap and it is an exciting time to be here as we’re are doing amazing things,” Dunning explained.

About Recall Masters:

Recall Masters is the leading provider of automotive recall news, data, training, and communications, dedicated to helping automakers and their dealers expedite the repair of recalled vehicles and make the roadways safer for everyone. Greater recall awareness and proactive recall management helps automakers protect their brand and build trusting relationships between automotive dealers, rental car agencies, auto auctions and consumers alike. Recall Masters is a privately-held company based in Laguna Hills, CA. To learn more about Recall Masters and comprehensive recall management, please call 888.651.4480, email info@recallmasters.com or visit www.recallmasters.com.

Media Contact:
Sean Reyes
Chief Marketing Officer
sean@recallmasters.com
949.246.6023