Monday, May 14, 2007



RV Business
Monday, May 14, 2007

Dometic Corp.'s Brad Sargent
Faced with the prospect of a sizable product recall earlier this year – its first ever – Elkhart, Ind.-based Dometic Corp. was confronted with the same kind of serious strategic challenge that scores of American companies experience every year: How best to get the word out to consumers from coast to coast and, at the same time, exact the quickest and most efficient fix possible.

“Dometic is committed to offering RVers the best and safest in RV products,” Brad Sargent, vice president of marketing, stated in a Feb. 12 release announcing the recall of 926,866 refrigerators manufactured between April 1997 and May 2003. “We apologize for any inconvenience this may cause.”

The release went on to point out that of those recalled units, “99.99% do not pose a danger to the owner.” Nevertheless, a recall is a recall, and the RV Business staff wanted to hear more from Dometic’s Sargent about steps that were taken.

RVB: Given the fact that this was your first recall ever, how did you figure out where to start in sorting through the bureaucratic and procedural issues awaiting companies in situations like this? Did you seek outside assistance?

Dometic monitors its warranty program very closely. We look for trends, and act on the information that we see. In 2006, we were disturbed to notice a couple of reports of fires. We knew that the first step was to contact the proper authorities. The CPSC received a call from us, and they pointed us to the National Highway Traffic Safety Administration (NHTSA) as the entity with jurisdiction.

NHTSA’s input has been invaluable. Recalls are very formalized processes with a list of regulations that at first seemed daunting. There were self-imposed deadlines and NHTSA-imposed deadlines, and we worked hard to meet both.

We recognized early on that we needed to assemble the right people for a team. We sat in a room and started asking questions. Each question brought a solution and the program began to take shape. Every day we learn more about how to bring efficiency and accuracy to the management of this recall.

RVB: What, specifically, did this recall involve?

In our notification to NHTSA, we indicated that an oversized heating element could possibly over time create a fatigue crack in the adjacent boiler tube. The crack could then release a pressurized coolant, which could in very rare circumstances catch fire.

The incident rate is quite low; testing and analysis has determined that 99.99% of the recalled refrigerators will never experience a fire. But, clearly, this is a safety issue. Our own standards for quality, as well as NHTSA’s, demanded that we take a good look at the problem and find a solution. This recall is the most effective way to take care of our valued customers who have affected refrigerators.

RVB: The total number of units recalled – 926,000 – is considerable by most standards.

You’re right. The logistics behind a program of this magnitude are very complex. There are a lot of consumers to contact and to distribute critical information to. Each customer group had specific information that we needed to communicate to them – scores of OEMs to work with, thousands of dealerships and installers to educate, and then we had to pay for their work.

It was important to have a strategic notification plan for OEMs, dealers and consumers. These formal notifications were sent out this past January.

It has been a truly monumental undertaking. We contracted with a company that specializes in recall administration to handle the data storage and processing, as well as communication to all of our customer groups. They have staffed our recall information hotline, and they receive thousands of calls every day.

RVB: Do you have the resources necessary to handle a program of this magnitude?

Yes. We have the manufacturing capabilities to produce the rework kit and we have the distribution chain to ensure that customers have access to the kit. And we have good people making sure that this program runs smoothly. From a financial standpoint, Dometic is a strong, global company. We have allocated the proper funds, along with insurance, to handle this recall effectively.

RVB: So, how have owners of RVs containing refrigerators with the affected serial numbers been learning about the recall? It’s obvious that magazine advertising was one of the ways, as we’ve seen recall notices most everywhere.

From the first internal meeting, we knew the importance of structuring a plan that educated the marketplace. Each component was developed and presented to NHTSA for approval.

We sent official recall notices to hundreds of thousands of end consumers, thousands of dealerships and installers, and every involved OEM. The OEMs have been contacting owners from their customer lists. We have paid for and utilized R.L. Polk vehicle registration lists all in the name of finding good owner information.

We developed a page on our website for consumers to plug in their serial number and model information. If they have an affected refrigerator, it tells them what to do. We worked with an SEO (search engine optimization) specialist, to ensure that consumers looking for Dometic recall information online would receive the latest relevant news.

We are even looking to RV rallies to educate folks on the recall. At the FMCA show in Perry, Ga., we actually sent a team of installers door-to-door on the grounds of the rally, taking care of any consumer we came across with a recalled refrigerator. We created a hotline for consumers to call and we disseminated that number as much as possible. Press releases for RV publications and thousands of posters for dealerships, service centers and campgrounds were distributed. As you noted, we are running an extensive ad schedule. Each component goes to ensuring that we reach as many people as possible.

And frankly, we see this Q&A with RV Business as another opportunity, not just to be forthright, but to spread the word on the recall. We want as many consumers as possible to know to check their model and serial numbers by calling 1-888-446-5157 or going to to find out if they are involved. If they are, we’d like them to call a servicing dealer and set up an appointment to install the rework kit.

RVB: Tell us more about this rework kit that was to be available in mid-April. What is it, and how does it work?

First of all, it’s important to understand that the development of this kit is one of the good things that came from our current situation. The sheer number of refrigerators involved, coupled with the rarity of the problem, created the need for an appropriate and innovative response. We brought in a team of highly qualified industrial scientists to work with Dometic engineers in developing the Secondary Burner Housing (SBH) Kit. Thousands of man-hours have gone into its development and testing. Even so, we were able to develop and begin to ship the kit prior to the mid-April target date.

The rework kit is a secondary housing made of galvanized steel. It encases the burner, effectively encloses the area in the highly unlikely event of a fire. A double redundancy set of fuses is included as well. If any excess heat is sensed by these fuses, the refrigerator shuts down automatically.

We knew how important it was that we get the fix right. Naturally, our number one priority is keeping our customer and the vehicle from harm.

RVB: Is the consumer charged for any of this work?

Absolutely not. It is against federal law to charge the end consumer for recall work on any product.

We really appreciate the thousands of installers across the country that agreed to handle installations of the SBH Kit. We have received a few early reports of consumers being charged for the work. Not only will we not accept that, the National Highway Traffic Safety Administration won’t either. The regulation states that charging the consumer for this fix is a federal violation subject to a fine of $5,000 for each incident, with the potential for a total penalty of $16.5 million.

It is important to Dometic that a member of the servicing network does not receive a large federal penalty. Even more important is the safety and peace of mind of our customers.

RVB: How are dealerships and service shops reimbursed for the installation work, and what’s the most important thing for them to know about this recall?

The strategy here was to streamline the warranty process as much as possible. A postage-paid card is included with every SBH Kit. The installer simply fills out a few lines of information and drops it in the mail. The cards are processed and checks are cut.

During the development process for the SBH Kit, we found that a variety of installation scenarios existed, depending on how the refrigerator was originally installed. While the vast majority of installations will be simple, if the SBH Kit installation job goes longer than expected, we have a program in place for the dealership that will allow for a higher payment.

Naturally, there has been a learning curve with this program early on. But we feel that the program is now running smoothly. The most important things for dealers to know about this recall are that the SBH Kit can be installed quickly and easily, they can contact us if they have any trouble, and they cannot charge the customer under any circumstance. We see this as an opportunity for dealers to demonstrate excellent service and reinforce customer relationships, as well as meet new RV customers.

We want to thank them for being a part of this program and helping to ensure the safety of RV owners.

RVB: Considering this and previous recalls by other manufacturers, do RV owners have any cause for concern regarding the general safety of RV refrigeration?

I can’t speak to other manufacturers and the problems they have had, but Dometic refrigerator owners can be assured that we are using this as a learning experience. While we have always been motivated to design and produce excellent products, this recall prompted us to take an even harder look at our product. It created further testing and development, which has already led to innovation. At the end of this road, Dometic refrigerators will be better than at any point in our history.

We invented refrigeration 80 years ago, and we’ve been developing great products ever since. We have a history of innovation and standing behind our products, and our customers can rest assured that this latest event will not deter us from that, but instead make us an even stronger company as we look to the future.

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