Tag: recalls

OM in the News: Ford Breaks Record—Of Safety Recalls

Ford has recorded more safety recalls in the first six months of 2025 than any car company ever has in an entire calendar year, reports The Wall Street Journal (July 12-13, 2025).

Ford just recalled 850,000 pickup trucks and SUVs because of a potential fuel-pump failure. A bad fuel pump could result in the engine stalling while a driver is operating the vehicle.

Last month, the firm said it would need to fix  200,000 all-electric Mustang Mach-E SUVs after receiving complaints from the government about customers being unable to open their doors as a result of the vehicle’s 12-volt battery dying, including cases where children were trapped inside. “There was no way for me to get inside my car without jumper cables,” a driver in Houston wrote in an April complaint. The person had to call emergency services and break into the car.

Also this year, Ford said it would need to fix nearly half a million 2016-2017 Explorer SUVs to prevent door trim from falling off. The issue was potentially creating a road hazard for other drivers.

In January  of 2025, Ford paid $65 million to the government as part of a settlement over violations of auto-safety laws, specifically over a delayed recall of 600,000 vehicles with defective rearview cameras. As part of the agreement, the automaker said it would spend an additional $45 million to improve internal systems for tracking safety issues.

Ford and its CEO  have staked out improving quality as a priority for the automaker. Improving quality will also help to reduce the billions of dollars Ford spends every year on warranty claims and safety recalls. The company hired a quality czar in 2022, and it has tied 70% of executive annual bonuses to quality. It said it has significantly improved product quality in recent years, with four new models winning accolades from a recent J.D. Power study on quality. The company has more than doubled its team of safety and technical experts and expanded testing on critical systems, such as vehicle powertrains, steering and braking.

Overall, recalls across the auto industry have been rising, with more than 1,000 recorded in 2024, compared with 800 a decade earlier.

Classroom discussion questions:

  1. What quality tools in Chapter 6 of your Heizer/Render/Munson text could Ford employ to decrease defects?
  2. Discuss Figure 17.1 in the context of Ford’s problems.

Guest Post: The Tesla Recall

Prof. Howard Weiss, recently retired from Temple U., shares his stimulating insights monthly on our blog.

Tesla is about to recall 135,000 automobiles, reports The Wall Street Journal (Feb. 2, 2021). Recalls occur after delivery of an item to a customer and as noted in Chapter 6’s “Cost of Quality” section in your textbook, their external failure costs can be extremely expensive. In particular, this recall means that the direct costs to Tesla will include the “cumbersome physical repair” (according to Tesla); the cost of the computer chip that needs to be replaced; the cost of reimbursement for the 23,000 owners who paid out of pocket for the repair prior to the recall; and the cost of informing Tesla’s service centers and owners about the recall. Your text also notes that there may also be a loss of goodwill or possibly liability costs.

The Tesla recall has to do with the touch screen control. Its failure can impact many different features, including backup cameras, defog and defrost controls, turn signals, heat and air-conditioning. Tesla claims that the touch screen should last 5-6 years. This is analogous to the Mean Time Between Failures (MTBF) in Chapter 17’s discussion of Reliability. But the National Highway Traffic Safety Administration (NHTSA) expects the touchscreen to last “at least the useful life of the vehicle.” 

Tesla, of course, is not the only automobile manufacturer to experience recalls. According to NHTSA,  from 2000 to 2019 there have been 14,791 vehicle recalls in the U.S. affecting roughly 680,000,000 vehicles. Over 90% of the recalls were for safety reasons whereas the other recalls were for non-compliance with federal standards. Manufacturers voluntarily initiated 80% of these recalls, while the remainder were instigated by the NHTSA.

Classroom discussion questions:

  1. Have you been affected by the recall of any product?
  2. What will be the major cost to Tesla for this recall?

OM in the News: The Deadly Ice Cream Recall

blue bellMy teenage son is a Blue Bell ice cream junkie. He polishes off about two 1/2 gallon containers of vanilla (why vanilla, of all flavors?!) a week–or at least he did until all Blue Bell was pulled off the shelves in April. Federal records, reports The Wall Street Journal (Aug. 5, 2015), show that Blue Bell failed to follow practices recommended that might have prevented listeria contamination of ice cream at its plants. The recall came after health officials tied its ice cream to 3 deaths in Kansas since the start of 2014, and additional illnesses elsewhere.

The Food and Drug Administration states that sanitation problems that created refuges for listeria have persisted at Blue Bell since at least 2009. Beginning in 2013, Blue Bell repeatedly found listeria in its Oklahoma facility—including on floors, a drain and at equipment that fills half-gallon containers—indicating the company didn’t do enough to identify the underlying cause or eliminate the source.

The FDA advises companies to regularly test for listeria on surfaces that touch food. It also recommends testing the food itself. But records show Blue Bell didn’t test its ice cream, or surfaces that touched it, despite finding listeria traces in the plant.

Until recently, listeria in ice cream was uncommon, though not unheard of. Neither of the two largest U.S. ice cream producers— Edy’s and Ben & Jerry’s—have had to recall their products due to contamination. However, three smaller ones recently have recalled products because of listeria contamination, including  Jeni’s Splendid Ice Creams, which had to shut production twice. So Blue Bell’s problems reflect broader complacency in the ice-cream industry about listeria. Many believe the frozen dessert is at lower risk of being associated with infections from listeria than some other packaged foods, in part because the bacteria doesn’t grow when food is frozen.

But as we discuss in Chapter 17, maintenance isn’t just about keeping facilities clean and machines working. It also involves management and employee awareness and involvement.

Classroom discussion questions:

  1. What did Blue Bell do wrong?
  2. What would quality expert Philip Crosby (see Chapter 6) say about the cause of the outbreak?

OM in the News: Toyota and “The Cost of Quality”

In our Chapter 6 discussion of the cost of quality (COQ), we note the external costs that occur after delivery of defective products (such as rework, liabilities, lost goodwill, etc.). Philip Crosby, author of Quality is Free, wrote that the cost of poor quality is understated and “there is absolutely no reason for having errors or defects in any product or service.” The New York Times (Oct. 10, 2012) article that Toyota just announced the recall of 7.4 million vehicles worldwide, including 2.5 million in the U.S., to repair power-window switches that can break down and start a fire , certainly brings Crosby’s ideas to the forefront for your class.

It was only 2-3 years ago that the company recalled more than 11 million cars to replace floor mats and sticky accelerator pedals. It has been seeking to reassure consumers about the quality of its vehicles since then. The recall could surely set back its efforts.

The vehicles affected in the U.S. include more than a million Camrys. Eight months ago, the National Highway Traffic Safety Administration opened an investigation into reports of smoke and fire coming from doors. During its investigation, the safety agency collected reports of 161 fires and of 9 injuries. In its news release, Toyota said there were “no crashes related to the recall,” but did not mention fires or injuries.  Toyota said it originally wanted to conduct a “customer satisfaction campaign” but decided to pursue the recall after discussions with the agency. Toyota described the recall as voluntary, but under federal regulations once a manufacturer learns of a safety problem it must, within 5 business days, tell the safety agency of its plan for a recall or face a civil fine.

Discussion questions:

1. Will such recalls impact your students’ images of Toyota’s quality?

2. How does this compare to GE’s dishwasher recall several years ago in which the cost of repairs exceeded the value of all the machines?

Good OM Reading: What Really Happened to Toyota?

Consumers in the US were surprised in Oct., 2009, by the 1st of a series of highly publicized recalls of Toyota vehicles. It began with 3.8 million cars brought back  for uncontrolled acceleration. Over the next 4 months, 3.4 million more  recalls followed for gas pedal and software glitches. Then from Feb.-Aug., 2010, 13 more recalls followed. Just as things seemed to be settling down, 2 more recalls were announced in Jan.-Feb., 2011. The total had now reached 20 million vehicles!

How could this happen to the company that shaped the modern approach to quality improvement, asks UC-Berkeley Prof. Robert Cole  in his excellent article in MIT Sloan Management Review (Summer, 2011). Had auto execs all over the world “been chasing after the wrong manufacturing model”? And to what extent did the problems originate with product design and assembly and to what extent to Toyota’s manufacturing systems?

One factor Cole found was a “reverse halo effect”. Toyota buyers in 2010 had heard a barrage of negative news and became far less forgiving about minor quality flaws than previous owners. A 2nd factor was that competitors’ products were improving to the point that Toyota didn’t look as outstanding by comparison as it had in the past.

Cole’s analysis found 2 root causes for Toyota’s problems: (1)management’s ambitious plans for rapid growth (which did not focus on quality issues already arising), and (2) the increasing complexity of the actual auto product.

I think this is an article that you will enjoy reading and that you will be able to use in your OM class.

OM in the News: Tylenol, J&J, and a Quality Disaster

A timely topic to bring to your students when discussing quality (Ch.6) is an embarrassing and expensive problem currently facing Johnson & Johnson. It’s a tale that has been making news for months now,  but just ended with the US government taking over 3 Tylenol plants a few days ago (New York Times,March 10,2011). This follows a blizzard of drug recalls and an FDA criminal investigation into safety issues at the factories. The government also indicted two execs, the VP-Quality and the VP-Operations, for failing to comply with manufacturing standards.

The scathing report on 20 manufacturing violations and criminal investigation follows eight recalls of Tylenol, Benadryl, and Motrin that have been ongoing since  2009. J & J was warned over a year ago about the unsanitary and unsafe practices in the plants (one in Puerto Rico and two in Penn.), but the company was slow to fix them. Now, all drugs recalled must be destroyed, a “consent decree” allows independent experts to control the plants until safer manufacturing processes are in place, and one of the Penn. plants will remain closed until the FDA stamps its approval. Fines will also be levied at $15,000 per day up to $10 million annually until the FDA clears the company.

Production is expected to be hurt while the corrective actions take place. But as Philip Crosby wrote in his 1979 classic, Quality is Free, “What costs money are all the actions that involve not doing it right the first time”.

Discussion questions:

1. What happened in Tylenol’s 1982  famous recall?

2. What did Crosby mean when he wrote “quality is free”?

3. What is the role of OM in this dilemma?

OM in the News: Toyota’s Quality Problems

Toyota’s sterling reputation for quality took a major hit in 2009-2010 with the recall of 5 million vehicles for unintended acceleration and braking issues. The auto maker was also slow to tell federal regulators about sticky accelerator pedals and was fined a record $16.4 million…not exactly the quality image the firm had built up over the past 4 decades! These quality problems led to a temporary shutdown of all US plants and a halt in the sales of 8 popular models.

The Wall Street Journal (Oct.5,2010) has just reported that all 2011 Toyota, Lexus, and Scion models are equipped with “black boxes” to help identify the cause of accidents.

Toyota’s situation would likely cause my mentor Phil Crosby to turn over in his grave. “There is absolutely no reason for having errors or defects in any product or service”, he wrote in his 1979 book Quality is Free.

Quality, it turns out, is not to be taken for granted, even when one is the leader in the field. Mercedes faced this same recall issue in 2004-2005, when its suppliers cut corners on quality in response to Mercedes’ desire to pump up corporate profits. Its recall was 1.3 million cars, costing $600 million. You may recall seeing a photo in Ch.6 of our book’s 9th ed. of an E -Class Mercedes setting itself on fire in Tokyo.

Companies that take their eye off the quality ball find that “quality is not free”, and that it may take several years to rebuild a  reputation.

Discussion questions:

1.What was Toyota’s initial response to the “floor mat problem” (which it claimed caused the accelerator to stick)?

2.What is Toyota doing today to deal with customer complaints?

3. Name some other recent major recalls of cunsumer items. How were they handled?