A series of high-profile safety recalls by car manufacturer Toyota made little to no impact on how consumers perceived the brand with car buyers still willing to pay the same price, according to a study from North Carolina State University.
“I wanted to look at how a product recall for safety would affect what a consumer is willing to pay for that product,” says the study’s lead author Dr. Robert Hammond, an assistant professor of economics at NC State.
Hammond found the average price of affected vehicles declined by approximately 2%, compared to unaffected vehicles (such as similar Honda models). That 2% decline is within the statistical margin-of-error for the study.
And the effect did not last long. The first Toyota recall was in November 2009, and the apparent decline in vehicle price had levelled out by January 2010.Read more at North Carolina State University