Effect of vehicle safety recalls on the perception towards other vehicles from the same country of origin

Abstract

A vehicle safety recall significantly impacts the demand for these specific manufacturer vehicles. The effect of this recall on the other manufacturers from the same country of origin (COO) that are not involved in the recall is poorly understood. The purpose of this study is to examine the impact of a vehicle safety recall on other vehicle brands originating from the same COO. The study uses a case study related to Toyota recalls and the impact of the crises on the attitudes toward three other Japanese brands—namely, Honda, Nissan, and Mazda. A questionnaire was conducted with 375 participants who are familiar with the recalls. The findings from the questionnaire indicated that product-harm crises have an indirect negative effect on brands from the same COO. Thus, brands from the transgressor's COO should not make the transgressor's betrayal salient, which might hurt their brands. For example, if Honda makes the betrayal of Toyota salient through comparative advertising, Honda's efforts might hurt the company directly through consumers' image of Japanese products. Future research should examine the extent to which comparative advertising impacts non-transgressing brands that originate from the same country as the transgressing brand. The current results suggest that the non-transgressing companies might even assist the transgressing company to recover from such crises if consumers perceive a strong association between the non-transgressing brands and transgressing brands.