Battery Recall May Ding Dell Reputation

Iria · Aug 15, 2006, 08:56 PM

Source: ExtremeTech
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Dell's battery recall couldn't have come at a worse time, with customer service waning and Wall Street increasingly growing impatient with the PC giant's earnings misses. The good news: Dell's main supplier, Sony, is expected to foot most of the bill for recalling 4.1 million batteries, analysts said.

Late on Aug. 14, Dell announced a voluntary recall of laptop batteries that could pose a danger to users. The recall comes amid Web video of exploding Dell laptops. Add it up and analysts said Dell's reputation has taken another hit as it is losing market share and its once high-flying shares are wallowing near five-year lows. It's unclear whether the recall will hurt future demand, but analysts such as Moors & Cabot Capital Markets analyst Douglas Crook said it is possible.

"We believe the battery recall is mostly a PR issue that will need some attention in terms of customer service and brand management," said Arun Sharma, an analyst with UBS Equities. "The timing of the recall is unfortunate given recent consumer share losses. We expect Dell to continue to invest more in the customer experience in order to improve its image over time."

Aug 15, 2006, 08:56 PM	#1
Iria DriverHeaven Extreme Member Join Date: Apr 2004 Posts: 7,275 Rep Power: 89	Battery Recall May Ding Dell Reputation Source: ExtremeTech ________ Dell's battery recall couldn't have come at a worse time, with customer service waning and Wall Street increasingly growing impatient with the PC giant's earnings misses. The good news: Dell's main supplier, Sony, is expected to foot most of the bill for recalling 4.1 million batteries, analysts said. Late on Aug. 14, Dell announced a voluntary recall of laptop batteries that could pose a danger to users. The recall comes amid Web video of exploding Dell laptops. Add it up and analysts said Dell's reputation has taken another hit as it is losing market share and its once high-flying shares are wallowing near five-year lows. It's unclear whether the recall will hurt future demand, but analysts such as Moors & Cabot Capital Markets analyst Douglas Crook said it is possible. "We believe the battery recall is mostly a PR issue that will need some attention in terms of customer service and brand management," said Arun Sharma, an analyst with UBS Equities. "The timing of the recall is unfortunate given recent consumer share losses. We expect Dell to continue to invest more in the customer experience in order to improve its image over time."