We gave Porsche a second chance... this was there response

As one of our kind readers pointed out, Porsche Australia appeared to have completely missed the point of our original letter. He suggested we give them the benefit of the doubt and reach out to them again to correct the situation. Here's what happened:

Second letter to Porsche:

Dear Ben - Really? Is that the Porsche Customer Commitment? How exactly is this Customer Relations Management?

It appears that the point of my letter has been lost in the translation. So let this letter be a bit more explicit. Porsche was given an opportunity to do the right thing. It was an opportunity to turn losing a customer into gaining a champion. Your response tells me you have chosen to let go of a customer that would have otherwise been loyal for potentially another 20 years.

What is a life-time customer worth to Porsche? What is the cost of losing a life-time customer compared to getting a new customer?

If you were to do a cost-benefit analysis on that, it doesn't stack up. The cost to Porsche of leaving your customer by the side of the road and losing him forever may be $0 now. But factor in the future loss of margin on sales, service and parts on all the cars he would have bought. Of course the second hand market may not be as lucrative to you, but surely you realise it is necessary to ensure upgrading existing customers to new cars.

Now add into your math the customer who was left by the side of the road that tells everyone who will listen not to buy a Porsche. If he steers only one or two potential customers away, what's the cost of that? With viral marketing today, there's a strong chance that this could get out of hand. 

Have a look at 

• this video of a 911 IMS failure that got over 500,000 views: http://www.youtube.com/watch?v=IC4Rpl0_dW8  while 
• this video of United got 13.6 million views: http://www.youtube.com/watch?v=5YGc4zOqozo and they ended up having to do the right thing after the horse had bolted. 

According to my math, the cost of losing just one customer is far more than $20,000. Imagine the cost of a good letter going viral. I already have about 50 people eagerly awaiting an update on this saga. And I have two people who have decided not to buy a Porsche - kid you not. Now imagine the potential damage when motoring publications decide to have some fun and when academics start using it as a case study of what not to do. I know a few academics and journos that will have a field day with this. Who doesn't love a good story.  

Point 1: So just to be clear - the first point is that on economic terms, it would have paid for Porsche to foot the bill to minimise the damage to Porsche's reputation that was once tied to quality.

This leads us to the second point of quality. When someone, who has plenty of options to choose from, spends 2-3 times what they would spend on an alternate luxury car, it is 'reasonable' for them to have higher expectations. My expectation in buying a Porsche was that I was buying something of higher quality. Quality is achieved by paying attention to detail. So let's explore that:

1. Your letter has my name spelt incorrectly. Thanks Been. 

2. You say my car is 11 years old. According to math, that would be impossible.

3. Forget the math, we're talking about an engine. Engines are not judged by age, but by mileage. This engine had only 85,000 kms when it failed and it had been serviced as per Porsche's schedule. Let me point out that I had, prior to this incident, spent over $5.5K on replacing numerous parts - none of which I hold Porsche responsible for because I understand wear and tear, although that's a lot of money for just one year. 

4. Forget maintenance. The part that failed had nothing to do with maintenance. It has to do with poor design and quality which is why this part has been re-designed a number of times and has been now completely designed out of the engine in the latest models. Let’s not try to kid anyone here.

Point 2: The argument you present does not stack up. Any reasonable judge or jury will agree that they would not buy a car that has an engine that only lasts 85,000 km. Even if this was the case, they would surely not buy this car for the kind of money asked in the second hand market when it already had 70,000 kms.

A key provision (s54) in Australian Consumer Law 'is a statutory guarantee of acceptable quality enforceable against the suppliers of goods (i.e. retailers, dealerships, etc.), as well as manufacturers.' Your North American operation finally saw the light, albeit after a class action case http://www.imsporschesettlement.com/, to agree to do the right thing. Is that what it's going to take in Australia? If so, move to point three.

Point 3: There is legal precedent and a legal framework that favours customers like me. We may be stupid, but we're not dumb.

All of that aside, it boggles the mind that Porsche is willing to allow its customer stories to be 'You're not in good hands when you buy a Porsche. Porsche doesn't sell quality and high performance. Porsche sells ticking time bombs that will cost you a bomb. And when they pop, Porsche will leave you by the side of the road.' Because that's the true customer experience - just search the web and I can vouch for it.

So,  

1. I have already initiated discussions with a law firm to understand what is involved in a class action case.

2. I will be sharing my story with anyone who cares to listen and will be targeting specific motoring media, web sites and academics. 

3. I will be approaching the appropriate government authorities.

It is human to err. My error was believing that I was paying for quality when I was buying a Porsche. Everybody makes mistakes, but when we don't learn from them... well you know the term for that. You can only fool the stupidest among us for only a period of time. 

The question is whether we are going to correct our errors before it's all too late? 

Over to you, once again... Please note that I will proceed down the path outlined above in a week, unless I hear back positively from you before then. I hope nothing is lost in translation.

UNFORTUNATELY THE BENEFIT OF THE DOUBT WAS UNWARRANTED. HERE'S BEN'S SECOND RESPONSE. THIS TIME HE GOT THE CUSTOMER NAME RIGHT...

Ok... next steps:

1. Lodge a case with Department of Fair Trading - DONE... stay tuned.

2. Speak to lawyers of North American Class Action settlement - DONE... Turns out Porsche settled the case very quickly. If there was nothing wrong with their cars, why would they?

3. Evaluate merits of class action case in Australia - Currently talking to a few law firms... stay tuned.