Ford EcoSport recall: Will it dent consumer sentiment?

Ford EcoSport recall: Will it dent consumer sentiment?
New Delhi:  The Ford EcoSport which was launched amidst much fanfare last month with an aggressive staring price of Rs 5.59 lakh (ex-showroom Delhi) has recalled almost 1,000 diesel variants of the car in little over a fortnight of its launch.

Will the recall dent consumer sentiment is the question looming large for Ford India.

The EcoSport diesel recall is to rectify defects in the instrument used as an aid in starting the engine.

The company maintains that the customers are taking the Ford EcoSport diesel recall positively and appreciate Ford owning responsibility for the defect.

"If the company would have thought like that (recall denting Ford India's image) then it wouldn't have done it (the recall)...what is important for us is customer satisfaction in the long run and customers are seeing that and there is positive sentiment about the recall," Ford India spokesperson told NDTV.

When asked if the move is likely to weigh on customer sentiment, Ford India said, "Don't want to speculate on that front."

''We are totally committed to the quality of our products and customer satisfaction and the fact that we were able to react quickly to the issue shows that. We believe that will benefit our customers in the long run.'' Ford India said.

Auto expert Tutu Dhawan, however, has a different opinion on the recall and believes it will indeed have a psychological effect on consumers.

"You see the problem is people don't understand what the recall is about, it's more of a psychological thing for customers. It will definitely affect customer sentiment," Mr Dhawan said.

Ford's biggest competitor in the compact sports utility (SUV) segment Renault's big-ticket Duster, which has been driving Renault's sales since its launch has had no such issues reported so far.

"As part of routine checks, we discovered a potential concern with EcoSport diesel variants related to the Glow Plug Module which requires relocating the module. We are contacting customers to take their vehicle to their Ford dealership to have the work carried out," Ford India had said in a statement on Thursday.

The Duster, with a starting price of Rs 7.99 lakh has been a game-changer in the compact SUV segment so far, until Ford stormed into the market with the EcoSport challenging Renault's pricing and taking its rival head on.

Mr Dhawan however, believes the Duster is unlikely to gain from the psychological impact the EcoSport recall may have on consumers.

"You see the difference in the prices of EcoSport and Duster is a lot, it's not a matter of couple of thousand (rupees), the customers' philosophy will be wait and watch...but Duster is unlikely to get extra business due to this but this is definitely going to be a reason to think for customers," Mr Dhawan said.

The company said it would take about two hours per vehicle to fix the problem in the 972 diesel variants of the EcoSport it has recalled.

Ford India clarified that the petrol variant of EcoSport does not have any such issues and there were no recalls in the segment likely.

Ford India's domestic June sales saw a 14 per cent jump thanks to the EcoSport.

The Ford EcoSport is available with three engines options -- the 1-litre EcoBoost petrol, 1.5-litre Ti-VCT petrol, and the 1.5-litre TDCi diesel. The 1.5 Ti-VCT will have the option of a six-speed dual-clutch automatic gearbox (same as the one in the Fiesta) while the rest of the variants will sport a five-speed manual.

Ford India has invested $142 million at its Chennai plant to manufacture the EcoSport.

The company is investing another $1 billion to set up its second production facility at Sanand that will be operational by 2014. The plant will have an installed output capacity of 2.4 lakh vehicles and 2.7 lakh engines annually.

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