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Print Edition> Business
UPDATED: February 24, 2014 NO. 9 FEBRUARY 27, 2014
The Blame Game
Weighed down by a massive recall, a farce has been staged by Aston Martin
By Deng Yaqing

The counterfeit material displays the deficiencies present in Aston Martin's supply chain and quality supervision, argued Zhang Yu, Director of Automotive Foresight (Shanghai). This may be explained by the carmaker's stakeholder and personnel changes. In 2007, Aston Martin was acquired by a consortium of investors that included American investment banker John Singers and two Kuwait companies, Adeem Investment and Investment Dar. Since then, it had been dragged down into a nightmare of sliding sales and expanding losses.

Its sales shrank from 4,800 units in 2011 to 3,800 units in 2012, with losses hitting £2.46 million ($4.08 million), and things failed to turn around in 2013. At the same time, Ulrich Bez, Chief Executive Officer of Aston Martin, had been in favor of subcontracting to improve production efficiency and lower costs.

Who to blame

"Aston Martin targets wealthy consumers who can afford exotic sports cars with price tags running into hundreds of thousands of dollars, which makes it unnecessary to separate the production of models from normal manufacturing. There is a possibility that Shenzhen Kexiang didn't know the models were used in the car production," said Zhao Yu, an automobile analyst, who believed the root cause was the inefficient supervision of product quality by PVI and Aston Martin.

In modern industrial chains, subcontracting allows suppliers to specialize in the production of a specific part and serve different downstream enterprises, which can remarkably boost the accuracy and quality of automobile parts, said Zhang Zhiyong, a car-marketing expert.

According to Zhou, such supply chains may pose challenges to quality management. With regard to Aston Martin's case, he maintained negligence in choosing suppliers was dangerous for product quality and customers, while passing the buck to Chinese suppliers was unprofessional. Therefore, automakers should give serious consideration to quality risks when picking subcontractors, he argued.

Furthermore, he stated that enterprises are fully responsible for their product quality and the quality supervision of subcontracted products. "Apparently, the Chinese supplier involved was not able to reach the strict standards that a prestigious luxury brand should insist on," said Zhou.

In the case of Aston Martin, the first-tier supplier PVI, which has a direct contractual relationship with Aston Martin, should be blamed and give a reasonable explanation to the public, Jia said.

"Aston Martin can only name the specific subcontractor at an internal meeting when investigating the causes, not to mention that Shenzhen Kexiang denied any direct contract with the carmaker," said Wan Di, a project manager of automobile business at a Sino-foreign joint venture, suggesting that Aston Martin had failed to inform consumers of the real cause and shoulder the responsibility.

A similar incident happened in 2007 when Mattel Inc., an American toy manufacturing company, recalled over 18 million products, because many of the products had exceeded the U.S. limits set on surface coatings that contain lead. At first, Chinese manufacturers were blamed for using paint that contained excessive lead, which resulted in the suicide of Zhang Shuhong, owner of Lida Plastic Toys Co. Ltd. Later, Mattel delivered an apology for maligning Chinese manufacturers in the course of toy recalls and admitted that most of its toy recalls were due to its own design flaws.

All quality problems boil down to the inefficiency of quality management. The current sweeping recall mirrors severe loopholes in Aston Martin's quality management and supervision system, market observers agree.

Email us at: dengyaqing@bjreview.com

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