Posted by: coastcontact | June 5, 2013

The Reasoning of Corporate Executives

jeep-cherokee-fireA fatal fire involving a 1999 Jeep Grand Cherokee that was struck by a pick-up truck, according to NHTSA

It is always a wonder to me how the reasoning of corporate executives works.  Those brilliant minds seem to ignore the obvious so many times.

An outstanding example was the decision by Sav-on Drugs in Los Angeles (a retail chain of drug stores) to change their name to Osco.  The new name was mistake because “Osco” having the same pronunciation as the Spanish word “asco” (oss-ko) which means “nausea” or “disgust”, a considerable factor within southern California’s heavily Hispanic market.  After spending millions of dollars on those new signs (Osco Drugs) they spent more millions changing the name back to Sav-on Drugs. 

Then there was the issue of auto safety.  Toyota Camry’s were reported to accelerate even as the drivers were applying the brakes.  Toyota’s sterling reputation was seriously damaged.  Consumer’s Reports removed their recommendation to buy that car and warned their subscribers that the car was not safe.  Stories about lax quality abounded.  Camry sales plummeted.  Apparently Toyota has overcome the issue after a massive recall.  It most definitely impacted my decision in purchasing a new car in 2012.  We bought a Nissan Altima.

So why is Chrysler saying “No” to NHTSA when asked to recall their 1993 to 2004 Jeep Grand Cherokees and 2002 to 2007 Jeep Libertys?  What could be Chrysler reasoning?  After all, they have finally seen a rebound in their sales.  Is it worth saying “No” to NHTSA?  Chrysler’s cars are still poorly rated by Consumers Reports but the public has been supportive of their brands.  Why chance another sales nose dive?

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