Study: Automakers delay recalls to minimize negative attention

Automakers tend to wait until competitors have announced recalls before disclosing their own, a recent study suggests, to 'hide in the herd' of other recalls.

1From Car and Driver

Rather than announce recalls as soon as they surface, automakers wait until they can blend into a crowd of other recalls, an academic study suggests.

This “clustering” of recalls reduces the attention paid to a given recall, and that lessens the negative impact on the stock price, because the automaker that initiates a cluster of recalls is the one that gets the most attention.