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Renault Clio Recall – March 2007

The 1990’s saw the birth of a new supermini car which Renault believed could change the motoring industry and the way we travelled, Renault where right. The Clio to date is one of Europe’s best selling cars in history and is the only car to be voted ‘European Car of the Year’ twice. Renault where growing from strength to strength, it seemed like nothing could get in their way of taking reign of the motoring industry. Its global force and power was incredible, being one of the top car makers in Western Europe. Renault was moving into Asia and North America, with their advertising expenditure reaching over six hundred million, making Renault ranked 34# in the worlds advertising chart. Renaults adverts had links with: The Simpsons, Thierry Henry and The Muppets, these just a number of clients that have worked with Renault.

Thousands of Renault Clio’s where recalled for safety checks after a number accidents had occurred all relating to the same problem, the bonnet. More than often cars travelling down the motorway, travelling around 70 mph would be in for a shock as their car bonnet would blow open shattering the windscreen. After the first case Renault said they would recall the model, Clio II, but said that they found no construction or design faults with the bonnet catch mechanism. This was just the begging of Renaults troubles.

Renault was under a great deal of pressure to recall one of their biggest selling models which has led to owners questioning the safety of their car. The Clio is an incredibly successful car which started its life in the 1990’s. Many angry Clio owners have created a Facebook group which has been dedicated to the car, highlighting the stories of bonnet failure, the aim of the group was to try and force Renault into issuing a product recall. The group called, ‘Renault Clio Bonnet Catch’, has 222 members, who have all added various images of their experience with the ‘faulty’ bonnet catch. The members have also added a series of details that describe the accidents caused by the bonnet shattering windscreens.

Facebook Group comments:

Happened to me today whilst driving down the M5 in the outside lane! Fortunately managed to slow down and eventually get over to the hard shoulder - but absolutely terrifying! Something has to be done!

Happened to me yesterday on a 50mph road on the way back from my MOT. Scariest thing that’s ever happened in my car I’m still shaken. Doesn’t look like I’ve got a legal leg to stand on though.

This is not the first time the French car maker, Renault has been forced to recall their cars, in Brazil more than 64,000 cars were recalled due to possible brake problems and fuel leaks.

The fault affecting Renault cars first surfaced three years ago, on the television program BBC Watchdog. The investigation found that if the bonnet catch was pulled too hard it could stick in the open position. This put Renault well and truly under pressure, especially after claiming, “There were no construction faults”. Renault’s head of communication left the company in 2007, claiming Renault knew there was a problem with the bonnet catches on as many as 550,000 Renault Clio II models sold between 1998 and 2006. However, Renault has consistently denied there is a manufacturing faulty, saying it is the drivers error that causes the problem. The government agency that oversees cars roadworthiness, Vehicle and Operator Services Agency (VOSA), agreed with Renault and no recall was issued. Although Renault denies any problems they wrote to owners advising them to take their cars to Renault garages or dealers to have their cars examined. The Clio owners group responded saying Renault where putting their customers at risk by refusing the recall, the group also said that Renault where endangering new customers because the Vosa website does not include details of the fault, future customers would not be aware of the problem. Vosa has a voluntary code of conduct which gives car makers the decision if they feel a recall is necessary, although they do have the power to force a recall but has never done so. Groups such as the Renault Clio owners group criticise the arrangement and say their relationship is too cosy. Crisis management is often described as the practice in which an establishment deals with a serious incident that can affect and could cause harm to the organisation, it could also attract adverse publicity. If an organisation wishes to successfully handle a crisis they must prepare, therefore they should have an organisation routine. An organisation should: have a crisis management plan and try to update it annually, have a trained crisis management team, exercise the plan to make sure the team works effectively and create messages that can be circulated in the event of a crisis.

However Coombs (1995) created a theory relating to crisis management in public relations, it was designed to help organisations deal with a crisis. Coombs used a two stage process to assess a crisis. The first stage is to determine the basic crisis type. A crisis manager would have to evaluate how the media and stakeholders define the crisis. A stakeholder is someone who is affected or has a valid interest in the organisation and could be affected by decisions made. They extract this data to group basic crisis according to the threat it could cause to the organisation. There are three groups in which crisis are categorised.

The first group is attribution of crisis responsibility; attribution theory considers that people try to explain why actions happen, especially when they are unexpected. Attributions create emotions and affect how people interact with the crisis; this often results in people blaming the organisation, if people blame the organisation negative relations are caused. This can be seen at Renault, the problem with the bonnet catch was sudden so their customer’s basic instinct was to blame Renault. This is evident by the rapid response on Facebook, creating groups target Renault and the problem. Renault faced negative reactions such as: damage to their reputation through word of mouth and other media sources, also sales reducing. There are four types of basic crisis that can affect an organisations reputation. Victim crisis are considered as minimal responsibility towards an organisation and their reputation. Victim crisis include; natural disasters which are acts of nature such as floods or an earthquake. Rumours, these are false and negative information that circulates about an organisation. Work place violence, this can be an attack by current or former employee within the organisations location on another employee. Product tampering is an external agent that can cause negative effects towards the organisation.

The second type of crisis is accident crisis which is thought to have low responsibility towards an organisation and their reputation. There are three categories; challenges, this is when stakeholders claim the organisation is operating in an inappropriate behaviour. This relates to Renault as their customers argue that their needs and wants are not being met, as they are purchasing defective products. Another challenge they face is customer would like Renault to call a product recall for the Clio II, but Renault insists that there is no need for a recall. A predicament is caused as Renault has to keep their reputation positive thus doing so by keeping customers happy, so why don’t they recall the Clio II and respond to their customers requests? But in doing so they could and most possibly will create negative media which may well have a huge affect on their reputation. The second category is technical error accidents; this is when equipment or technology fails on an organisation which leads to industrial accidents. The last category is technical error product harm; this is when equipment or technology failure can cause a product to be defective or potentially harmful. This is a problem Renault is faced with, as their bonnet catch has proven to cause accidents to many customers who say it is down to a faulty bonnet catch, although Renault argues that this is due to poor maintenance to the vehicle.

The final type of crisis is preventable crisis which is considered to have a strong responsibility towards an organisation and their reputation. Preventable is defined as if something can be hindered or stopped, especially by advanced planning or action. The first section of preventable crisis is human error accidents. This is industrial accidents caused by human error. Human error product harm is slightly different, as this is when a product is defective or potentially harmful because of human error. In this case the faulty bonnet catch doesn’t seem to have affected thousands of Clio’s II, only a reported couple of hundred. This could mean that a Renault worker could have made an error whilst working on a batch of cars, resulting in a human error. Organisational misdeed is when organisational actions put stakeholders, such as customers, at risk and possibly breaking the law. This is evidence in this crisis as a faulty bonnet catch puts customers at risk, but as VOSA hasn’t declared a problem with the car Renault isn’t breaking the law by not calling a recall.

The second step Coombs indentifies is to review the escalating factors of crisis history and an organisations previous reputation. If an organisation was to have a history of similar crises or has had previous negative reputation, the threat to reputation increases and outcome can be so much worse. If an organisation was found to be judged as having a strong crisis responsibility when the organisation had a previous crisis, this can lead to a greater reputational threat in the future. Coombs created the attribution theory based on crisis communication and how they can perform with their practices. This theory had nine stages, the first stage was; victims and potential victims should get all the information, also recall information. This can be crucial for an organisation in the case of a crisis. Although Renault did deny the fault with their Clio II, they did manage to publish a number of documents and statements, for example; Yann Vincent the Renault Director of Quality put a statement on the Renault website about quality. It was good PR for Renault as he posted positive comments such as; their main objective: to prevent you experiencing even the smallest of incidents on your vehicle. The second step is all victims should be provided with an expression of sympathy, victims should be given all the support they need. This is called care response. This is one area where Renault failed, as they had a number of customers that experienced some form of trauma due to the Renault Clio II, because Renault denied the claims that the bonnet catch was faulty. They didn’t support customers when needed; I believe this is why the public attacked Renault in such a vicious manner. The third stage is care response should be premium along with instructing information, to ensure the increase of negative response towards the organisations can be minimised. The fourth aspect is if the crisis has minimal attribution of crisis responsibility on an increasing issue, the organisation should try to justify or create an excuse. To successfully retain their reputation the organisation should send out information out to victims and set up a care response. The fifth stage is if a crisis is low attribution towards the reputation of an organisation, again the company should try to justify why the crisis has occurred. The sixth aspect of Coombs theory is if the crisis has low attributions, how the crisis will affect the emotions of the victims and public, the organisation should release an apology with information and commit a care response team for victims. Renault weren’t very quick to respond to customers about their views and problems; however they did release statements advising customers the best possible solution to their queries. Offering customers with free motor checks at any Renault garage to see if their car was safe on the road, Renault also appeared on national television answering customer questions, also facing gruelling interviews with journalists and television presenters. Stage seven is similar to stage 6, as the organisation should respond by compensating victims and giving as much information as possible, but the risk is greater for the organisation as the attributes are stronger. Step 8 is called the compensation strategy which is used if a customer or victim suffers any serious harm, Renault didn’t offer any compensation as such but did allow customers to get free checks on their cars. Stage 9 is to remind and to integrate strategies so they can be used during a crisis; this involves the crisis management team ensuring the crisis plan and team work effectively. The final stage to Coombs theory is denying the crisis should only be used if it is a rumour, also attacking the accuser should again be restricted unless it is a rumour.

After a crisis has occurred an organisation then reaches the ‘post crisis phase’, this is when the organisation tries to get their business back to their normal practices. If reputation has been damaged they should try to rebuild relations, in this case as Renault didn’t have to recall any of their vehicles it was only a small number of customers that had negative views. At first I think Renault where slow and almost ‘lazy’ on the uptake of their customer’s problems, but did eventually respond by posting statements on their websites and on other forums, also appearing on national television programs advising customers about their vehicles. This helped boost the trust of the public and potential Renaults customers. I believe that Renault were right not to recall the Clio II as it was later found that it was just a maintenance problem which occurred over time, also the damage that a recall could have caused to the brand reputation would have been enormous. The scale of the operation could have destroyed Renault, this would have destroyed many of jobs and disrupt the economy as it is such as huge scale. On the other hand I do understand why many customers felt betrayed by Renault, the response wasn’t quick as customers who had been in a serious crash or incident would have wanted and expected from such a respectable company. I think if Renault hadn’t come out on the defensive straight away I don’t think customers would have suspected their relationship with VOSA. Renault worked effectively after the crisis as they delivered all promised information to customers, along with stakeholder who were constantly updates on the progression of the crisis. Renault also told customers on a statement that they would analyse their crisis management team and plan to ensure the right response it applied in the event of another crisis.

Sources

Youtube video – Watch Dog

http://www.youtube.com/watch?v=P8CBv58Z9-g

Vosa letter:

http://www.dft.gov.uk/vosa/repository/07%20152.pdf

http://www.dft.gov.uk/vosa/repository/07%20152a.pdf

References

Last updated February 14, 2010

http://www.timesonline.co.uk/tol/driving/news/article7024312.ece [accessed 12.10.2010]

Last updated 29th March 2007

http://www.autoexpress.co.uk/news/autoexpressnews/207915/renaults_clio_recall.html [accessed 16.10.2010]

Last updated at 18:08 22 May 2007

http://www.dailymail.co.uk/news/article-456894/Thousands-Renault-Clios-recalled-safety-checks.html [accessed 18.10.2010]

http://www.theaa.com/allaboutcars/recalls/recalls.jsp?modelID=A2&modelName=Clio&makeName=Renault&makeId=D6 [accessed 16.10.2010]

http://www.dft.gov.uk/vosa/apps/recalls/searches/expand.asp?uniqueID=5619445A6BB4240380256BB9002693E3&freeText=Blank&tx [accessed 18.10.2010]

http://www.renault.co.uk/ownerservices/qualityandsafety.aspx [accessed 18.10.2010]

Last updated December 2007

http://www.instituteforpr.org/files/uploads/Coombs_Crisis2.pdf [accessed 25.11.2010]

http://www.renault.co.uk/cars/model/new-clio/product.aspx [accessed 26.11.2010]

http://www.adbrands.net/fr/renault_fr.htm [accessed 26.11.2010]

Bland, M (31.10.2004). When it Hits The Fan: Turning Crisis into Opportunity. London: Centre Publishing. 176.

Coombs, W (05.04.2007). Ongoing Crisis Communication: Planning, Managing, and Responding. California: SAGE Publications Ltd. 224.

Mitroff, I (04.03.2005). Why Some Companies Emerge Stronger and Better from a Crisis: 7 Essential Lessons for Surviving Disaster. London: Amacom. 256.

Regester, M (03.04.2005). Risk Issues and Crisis Management in Public Relations: A Casebook of Best Practice. London: Kogan Page Ltd. 264.

Reyner, J (25.07.2003). Managing Reputational Risk: Curbing Threats, Leveraging Opportunities - Institute of Internal Auditors Risk Management S.. London: John Wiley & Sons Inc. 340.

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Communication and Management Crisis

...Communication to Manage Crisis HCS/320 Communication to Manage Crisis Those who work in hospitals have to face crisis. It may happen in the emergency room or even in the manager’s office. Hospital employees need to be ready for such events. Coombs 1999 states that no organization can guarantee that they will not have any crisis. According to Reynolds 2006, crisis may occur internally or externally for the organization but when it occurs people’s lives may be at stake and at the same time the reputation of the company may get jeopardized. During crisis communication as well as improper communication can play a great role. For lack of communication right things may not be done and crisis may occur. Even a rumor may spread and crisis may happen. Communication methods to be adopted during a crisis have been talked about a lot but defining crisis is not so easy. According to Heath 2006, before defining the crisis, the risks need to be identified. According to him a risk may have both negative and positive influences of different levels. If anything happens to people, communication with them can tell us a lot and it can be understood whether crisis can be overcome. Whether reputation can be left intact needs to be understood. I am acting as the director of the Regional Emergency Office and I got reports about the public water that had been infected with something fatal. The pollutant is a biological element that has life threatening effect. We know that biological agents...

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