Car Recall Data: no Brands

The measures Toyota took in America and China respectively when dealing with customers (after apparent safety issues) were worlds apart, argues Southern Metropolis Daily, in an article of May 1 titled “Why does Toyota dare to openly discriminate against Chinese consumers?” The only vehicle type recalled in China was Toyota RAV4, involving 75,000 car owners, and the extent was smaller than abroad, writes the paper. In America, Toyota had provided on-site vehicle inspections, paid or subsidized the owners’ transport expenses, and provided them with similar cars during the repair time. In China on the other hand, Toyota only apologized, but offered no compensation. By operating two different sets of treatment, Toyota had discriminated against Chinese consumers, and because government supervision and the judiciary had allowed that to happen, they had failed to do their job, writes Southern Metropolis.

Chinese Car, Syrian Characteristics

Made in China, bought in Syria: Complaints about this one would hurt many feelings

Unclear quality information about Chinese automobile sales was hampering consumer protection, lacking the drive to award the superior and to eliminate the inferior (奖优汰劣). Neither did the government monitor quality according to transparent data, nor was there a defined process for making the manufacturers recall their products. Requests by a “safeguarder of rights” (apparently a lawyer) named Liu Wenjun (刘文俊) for information about consumer lawsuits had been politely but clearly refused.

On October 1, 2004, an auto recall regulation was introduced, but so far, there were only few recalls recorded,the China Vehicle Recall Website (中国汽车召回网) listed every recall action, but without information that would easily provide specific data, writes Southern Metropolis. The China Association for Quality’s user committee (中国质量协会用户委员会), che310.com (车人网) and an organization or publication named Tsinghua Car (清华汽车) jointly published a “China Automobile Quality Report Quarterly” on April 29, showing complaints against companies such as FAW-Volkswagen, Shanghai Volkswagen, Shanghai GM and dozens more. But valid  information concerning safety and service was hard for consumers to find there, too.

Southern Metropolis Daily quotes statistics saying that the number of car ownerships in China had reached 76,190,000  in 2009. Production and sales that year exceeded 13.6 million. The production and sales of passenger cars also exceeded ten million for the first time in 2009, making China the world’s biggest country in terms of car production and consumption. But the production and consumption giant is a legal protection dwarf, notes Southern Metropolis. A director with the General Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China (AQSIQ) who replied to Liu Wenjun’s data requests actually embodied all the care and thought spent on protecting the producers:

“AQSIQ isn’t only responsible to the customers, but also for not misguiding the public. We can’t harm the car manufacturers. If we publish brands, we will receive huge pressure. Commercial and consumer associations’ periodical complaints are published in accordance with the types of complaints, not by the product brands.”
That’s why Toyota dares to discriminate, the paper subsumes. The problem, it says, goes beyond the car industry. The governments interests were GDP-based – bao ba, i.e. making sure that economic growth is at eight per cent or more, was an overriding governmental concern.

Li Yongyan, with the Asia Times, referred to the same regulation as Southern Metropolis. His or her criticism, right after its introduction was announced:

The maximum fine, if an auto maker refuses to recall a defective vehicle or part, is only 30,000 yuan (US$3,600) – so small that it does not represent a disincentive and may even be an incentive to ignore new regulations – just part of the cost of doing business.

That plus the factor that China prefers administrative over legal remedies. A 30,000 yuan RMB fine is just not as convincing as a lawsuit that can get a manufacturer slapped with a lawsuit involving millions or even billions of dollars.

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Related
Shanzhai Shandong Cars, Oct 26, 2009

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