Volkswagen started the last decade with some momentum, thanks to clever ads and the return of the iconic Beetle. By 2003, the new generation of VW converts were an irked bunch, thanks to a problem with faulty ignition coils in its four- and six-cylinder engines that led to charges of foot-dragging by the German automaker. The coils would fail without warning, and until an official service action in 2003, VW only would replace the coils after they had failed--and after much kvetching. Eventually, more than half a million Volkswagen and Audi vehicles were included in a service action that replaced the coils at no charge. The cost to VW's reputation: enormous. Today, the issue still is under surveillance by the NHTSA, as VW prepares another U.S. onslaught with the 2011 Jetta and with a new mid-size sedan manufactured in Tennessee.
2002-2004: Honda automatic transmissions
Honda's first step beyond four-speed automatic transmissions proved a difficult one. A new five-speed automatic developed for use across its lineup, in vehicles from the Honda Accord and Odyssey to the Acura TL and MDX did not provide enough lubrication for proper transmission shifts. Honda spent more than $150 million to fix the problem in more than 1 million affected vehicles, but its reputation for reliability took a big, rare hit.