Risk Management & Analysis

Stout is recognized internationally as a leading advisory firm in the automotive sector. Our experts have advised companies ranging from multinational, publicly traded OEMs and Tier 1 suppliers to closely held component suppliers around the world. We have also worked with franchised and independent dealerships, raw material suppliers, logistics and data providers, and other stakeholders and participants in the automotive supply chain.

What we do

Stout professionals have provided consulting services and expert testimony for significant automotive industry warranty and recall programs and disputes. On behalf of both OEMs and suppliers, Stout has analyzed:

  • Warranty and recall data-collection systems, warranty repair history, administrative processes and costs, recall risks and costs, component risk factors, recall completion rates, and other information
  • Warranty and recall circumstances of many sizes and types – from the largest of recalls affecting millions of vehicles to small recalls or extended warranty actions affecting several thousand vehicles – and everything in between

Our analyses are used to assist clients in understanding the risk and economic costs of warranty service repair, recall campaigns, and other actions for purposes of risk mitigation, improved business processes, customer and supplier negotiations, claim assessment, and settlement and trial testimony.

We work closely with our clients to understand the risk and potential impacts associated with defects of automotive components, whether it is a customer service action, extended warranty offers, a voluntary recall or one required by NHTSA, or other responses to warranty data, component defects, or customer complaints.

How we do it

We utilize a collaborative approach leveraging our clients’ knowledge, experience, and expertise – seeking to integrate cross-functional expertise from our clients with Stout’s data and experience. To do this, we:

  • Develop and use over 20 data sets containing recall and other defect campaign data
  • Use our expertise in understanding the wide variety of potential warranty and recall activities and the costs associated with each
  • Employ traditional and creative approaches in assessing risk from multiple perspectives, as appropriate
  • Make use (wherever possible) of supplier and program-specific information to further refine and support our analysis
  • Apply both quantitative and qualitative risk factors impacting warranty and recall risk, as warranty and recall risk is often nuanced and not easily represented by simple mathematical or actuarial calculations
  • Identify likely warranty and recall scenarios and establish cost and risk parameters for each
  • Work to develop risk-mitigation strategies based on our work with the cross-functional teams of our clients (engineering, legal, insurance, risk management, sales, etc.)

To learn more, read our Automotive Warranty & Recall Services brochure. 

 

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