Print

Comment

Email

Digg

Del.icio.us

Reddit

Nokia, the handset market leader, has once again stood by its reputation. The Finish giant has recalled certain Nokia branded chargers, manufactured by a third-party supplier, owing responsibility. In India, this charger exchange program is limited to charger model AC-3E only, manufactured between June 15 to August 9, 2009, for a Nokia mobile phone-Nokia 7210. However, globally the exchange program includes AC-3U, AC-3E, AC-4U series of cellphones.

In an issued statement the company said, "During a routine quality control process, Nokia identified a potential product quality issue with certain chargers manufactured by one of its third-party suppliers. The plastic covers of these chargers could come loose or separate, exposing the charger's internal components and potentially posing an electric shock hazard, if certain internal components are touched while the charger is plugged into a live socket.” While Nokia did not name the number of customers affected, reports have estimated the recall applies to 14 mn chargers worldwide. The numbers of people affected in India would be small.

Nokia, as per VOICE&DATA estimates have a market share of 64% by the end of FY 2008-09. Nokia, is still the market leader in the country, but its growth rate is falling down. The company had registered a growth of 10% in the last financial year. Its closest competitor, Samsung grew by 72%, with an innovative and attractive product line.

This product recall will strengthen Nokia's brand image in the country. Whether this exercise will be able to catalyst sales figure-which is heading south, for the handset manufacture-can only be told in the coming times.

"It will obviously strengthen the company's brand image among users. It will boost its reputation and customer's confidence too. But, I doubt how much of it would convert into sales, as buyers consider various factors while buying, brand value is only one of them," said analysts associated with a leading research firm, pleading anonymity.

These chargers were manufactured this year by the battery making arm of Shenzhen based BYD. The company is owned by Wang Chuanfu, the second-richest man in China. Moreover, US millioner, Waren Buffett's MidAmerican Energy owns a 9.9% stake in BYD, which stands for 'Build Your Dreams'.

It is worth mentioning that, BYD also makes chargers for Motorola. The company will cover the costs of the recall. Interestingly, BYD's success is largely driven by automobiles-not rechargeable battery or mobile phone component sales. Revenues from cars accounts for 55% of BYD's sales.

Nokia's last recall was in 2007, when it found 40 mn lithium-ion batteries produced by Japanese manufacturer, Matsushita Battery Industrial that posed a risk of overheating. During charging, a short circuit can occur which may pose an overheating risk. So far, about 100 separate incidents have been reported. Although there were no serious injuries or property damage being reported. At that time (FY 2007-08) Nokia had a market share of 62.5 % with a growth of 30%.