Rise In Auto Recalls May Result In A Vehicle Price Surge
If knowing vehicles have never been recalled as frequently as they are now wasn’t enough, now consumers are faced with another troublesome consequence of the great volume of auto recalls: rising prices.
According to a series of news sources, suppliers that are responsible for developing auto parts are going to have to step up the quality of their manufacturing process. Experts say that this will cause an increase in vehicle prices. In spite of the fact that 2014 was a record year in car sales, manufacturers are soon going to be concerned about the prices of their vehicles since auto parts are going to cost them more.
The development of better techniques to manufacture certain auto parts may force companies to invest a lot of money in purchasing more sophisticated machinery. This will eventually force manufacturers to raise the price of their parts so they can cover the expenses of stepping up quality.
The move to ensure equipment failure is no longer a reason behind major recalls, especially those linked to deadly accidents, might be traced back to the companies’ concerns regarding liability issues. To avoid having to compensate for the losses in the long run, companies are working on developing safer, sturdier parts that might stand the test of time and keep the number of recalls down.
Experts believe that the number of auto recalls tends to go up instead of down mostly because most newer vehicles come with too many electrical components. The more complicated these components are, the more recalls are going to be issued. This type of development of very sophisticated parts may cause the prices of autos to continue rising.
Takata Air Bag Problem Prompts Concerns
Companies like Takata are working on developing better technologies to manufacture auto parts after its air bags were responsible for the recalls of millions of cars across the country. The items manufactured by the Japanese parts manufacturer have been associated with at least five deadly crashes. In all incidents, the air bag inflators made out of metal exploded once they were deployed, causing metal fragments to impact passengers and drivers.
Takata is expecting to lose 25 billion yen, which is about $212 million as it puts 47.6 billion yen into changing certain quality provisions regarding its products.
Honda is one of the companies impacted by the air bag issue. According to a series of reports, the Japanese automaker is set to pay a record $70 million in civil fines over failing to notify federal agencies about the more than 1,700 deaths and injuries associated with its vehicles and their flaws.
While it’s important that parts makers are changing how they ensure their products quality, consumers are in for a surprise when checking for new vehicles’ price tags in the future.
Click here to read more on this story.