E&MU: Fleets’ Methods for Managing Truck Recalls

By Mindy Long, Contributing Writer

This story appears in the May/June 2012 issue of Equipment & Maintenance Update, a supplement to the May 14 print edition of Transport Topics. Click here to subscribe today.

Some motor carrier executives have said the sometimes maddening process of addressing truck recalls is eased by ready access to notifications about potential problems and the ability of some fleets to handle the work in-house.

In just the past nine months, P.A.M. Transportation Services, Tontitown, Ark., has received notices of recalls and campaigns on issues ranging from exhaust gas recirculation systems and heater cores to electronic control modules, said Gerald Mead, the carrier’s vice president of maintenance. P.A.M. Transportation ranks No. 62 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers.

“When you’re in the process of buying new equipment, sooner or later you’re going to have some sort of recall or campaign,” Mead said.

And recalls can affect everything from electronics to mechanical equipment, fleets said — in short, almost all of the components on a truck.

Both Scott Perry, vice president of vehicle supply management for Ryder System Inc., and Todd England, executive vice president for C.R. England Inc., told Equipment & Maintenance Update they’ve also seen the number of recalls increase in recent years.

“There are campaigns that may be as simple as an electronic recalibration related to the emissions or the fuel economy. Others would be component reliability where they’ve identified an accelerated failure rate of a specific component,” Perry said. Ryder System, Miami, ranks No. 12 on the for-hire TT 100.

England, who said increases in onboard technology have added to the recalls, also said, “I don’t think manufacturers have become lackadaisical in testing products, but sometimes I wonder if there are unforeseen things come into play” that would cause a recall. C.R. England, Salt Lake City, ranks No. 21 on the for-hire TT 100.

A recall is issued when a defect relates to motor vehicle safety or when a vehicle is not in compliance with a motor vehicle safety standard. Other manufacturer-initiated equipment fixes are frequently termed a campaign and don’t require involvement from the National Highway Traffic Safety Administration, which issues recalls. According to NHTSA data, the major manufacturers that sell Class 8 trucks in the United States — Daimler Trucks North America, Portland, Ore.; Navistar Inc., Lisle, Ill.; Paccar Inc., Bellevue, Wash.; and Volvo AB, Gothenburg, Sweden, combined to recall 245,739 trucks in 2011, up from 239,826 in 2010.

Already this year, a major recall that affected the trucking industry involved a brake valve manufactured by Bendix Commercial Vehicle Systems. In March, the company recalled 131,221 defective valves installed on more than 67,000 trucks produced by Volvo, International, Kenworth and Peterbilt.

Bendix is distributing permanent repair kits to truck makers now, and OEMs will reach out to carriers when they receive a certain amount of kits. The company doesn’t have a specific time frame for when carriers will hear from the OEMs, but Bendix has said it may take six months to complete the required repairs. Bendix did not respond to requests for comment for this story.

Manufacturers must follow specific procedures if they discover a safety defect in their equipment, which include notifying NHTSA, equipment owners, dealers and distributors of the defect and then remedying the problem at no charge to the owner.

“A description of the safety-related defect, the scope and the owner notification timing are all included in the report,” said Brandon Borgna, a spokesman for Volvo Trucks.

NHTSA regulations require vehicle manufacturers to notify registered owners, the last known purchasers and lessors of its vehicles of the recall by mail. NHTSA’s investigative process consists of a review of customer complaints, an analysis of any petitions calling for defect investigations and/or reviews of safety-related recalls, the investigation of alleged safety defects and an investigation into the effectiveness of safety recalls.

“Each owner of a vehicle affected by a safety recall receives a notification via first-class mail with the words ‘Safety Recall Notice’ clearly marked on the outside of the envelope,” said Nasser Zamani, senior manager of compliance and regulatory affairs for Daimler Trucks North America.

Borgna said all affected customers, fleet customers and owner-operators are notified at the same time. However, some carriers said they often get advance notice.

“We’ll typically get notice prior to an official recall being issued, so we have a little bit of a jump on it in terms of putting together a procedure,” England said. “Oftentimes, we’ll have some inkling of a problem going on and having had failures in our own fleet.”

Mead said he also stays up on recalls by reading industry publications.

“A lot of times, you’ll catch a recall, but you don’t know if it covers your trucks. We can then check to see if it affects our fleet,” he said.

Perry said how Ryder learns about a recall varies, depending on the manufacturer and the size, scale and scope of their relationship.

“There are some we interact with on a daily or hourly basis. If they issue something, we get a direct call about what is being released and when,” Perry said. “If it is a smaller, less volume-driven relationship, we’ll typically receive an electronic notice or a written notification to our technical assistance team.”

Kyle Treadway, president of Kenworth Sales Co., West Valley City, Utah, which operates 20 branches in Mountain and Western states, said dealerships get pulled into the loop when there is formal notification.

“We’ll receive an electronic notice with comprehensive outline of the problem, the mechanical issue and the risks that are apparent with it,” he said.

Dealers receive specific information on the part that must be used, the labor involved and what they will be compensated for it. OEMs also provide dealers with a list of the chassis and vehicle identification numbers in the area and what they sold to customers. “Then it is our responsibility to contact those customers and coordinate a repair,” Treadway said. “Kenworth sends a written notification, but we prefer a phone call because we know we’ve reached them.”

NHTSA also requires lessors that receive a recall notification to notify their lessees within 10 days of their receipt of the notice. Ryder relies on a dynamic tracking system that allows the company to issue a recall notice across its entire network.

“It shows up in our shops, and they know immediately that vehicle needs to be serviced,” Perry said.

After the notice is given, Ryder creates a repair order and updates the information as the work is performed. How long the process takes depends on the type of recall.

“For the immediate, high-severity campaigns, we work to get the vehicle off the road and into our shop immediately,” Perry said. “Then there are campaigns where we notify them there is a component that needs to be replaced at their earliest convenience or that it can wait until their next regularly scheduled maintenance.”

When issues are not related directly to vehicle safety, OEMs have several levels of service actions from which to choose.

“Depending on the circumstances, an owner may receive notification advising them to bring their vehicle in for a specific repair, or they may not be notified and only receive a modification if they experience a problem,” Zamani said. He added that, in general, each individual vehicle is flagged in the OEM’s service support system so that, when the vehicle comes in for routine maintenance, the service provider knows that the recall must be performed before the vehicle is returned to service.

“Beyond safety or noncompliance recall campaigns,” Navistar spokesman Steve Schrier said, “Navistar periodically conducts authorized field changes for customer service purposes such as improvements for performance or durability.”

Certain requirements surround recalls, and repairs typically need to be performed at an OEM repair facility. But some large fleets have representatives from the major manufacturers working in their shops and can do the work themselves, or at least they have affiliations with local dealers who can handle the work for them.

“The specifics on how to have a recall performed on a vehicle are identified in the customer notification letter that is sent out,” said Michael Lynch, director of Nafta customer service and product support for Meritor.

When deciding whether or not to fix an item in-house, Mead said he looks at how many units are affected, downtime, the cost and any needed mechanical training.

“We look at all of those factors to make a smart decision if we’re bringing it in-house,” he said. “You don’t want to put an untrained guy on a fuel line campaign because it could leave you open to liability if the repair isn’t completed right.”

If carriers see a recurring problem, they sometimes issue their own in-house campaign. Mead uses photos and strives to make an in-house recall look just like a manufacturer recall. If vehicle owners suspect a safety defect, they also can notify NHTSA, and the federal agency may launch an investigation.

“The many reports received by the public form the basis for NHTSA’s defect investigations, which often result in significant safety recalls,” the agency said on its website.

In NHTSA regulations, vehicle manufacturers are required to reimburse owners for costs incurred to remedy a defect based on either the date NHTSA opens its engineering analysis or one year before the manufacturer’s notification of a defect to NHTSA, whichever is earlier.

Manufacturers are legally required to cover the cost of the recall fix, but they don’t cover expenses for the travel to get a truck to a dealership or the downtime of that vehicle.

Darry Stuart, president of DWS Fleet Management Services, Wrentham, Mass., has one fleet customer that recently had to drive a handful of trucks 40 miles round-trip to take care of the recall.

“If you get 6 miles to the gallon, that is four gallons of fuel. That is $24 there, $24 back. Then you have to pay the driver, and you have to send a guy to go pick him up,” he said.

For carriers, it is also important that they keep track for the closing date of eligibility for reimbursement of repair, which for a motor vehicle is 10 days after the manufacturer mails the last of the owner notices informing them of the defect. For equipment, the closing date is 30 days after the manufacturer’s closing of its efforts to provide public notice of the existence of a defect.

When issues aren’t safety related, Stuart said, some carriers hold off on doing them until it needs to be done — even if they miss the reimbursement window.