The Automotive Industry, Briefly

The GM Recall Nightmare Continues

General Motors Recall

Last month GM announced the recall of 1.5 million small vehicles spanning seven models and three names that were equipped with faulty ignition switches.  So far this recall has cost GM an estimated $300 million, brings into question the validity of their 2009 bankruptcy, and has been responsible for twelve deaths.  These vehicles were manufactured between 2003 and 2007, but that is not where the GM nightmare ends.

In addition to the ignition switch recall, GM has just recently announced three more recalls to vehicles which affects an additional 1.18 million vehicles.  These recalls are for vehicles far newer than the ignition switch recall and shows GM is really trying to address defects proactively rather than wait until the ignition switch mess has been cleared up.

The details of these current recalls can be found at http://www.foxnews.com/leisure/2014/03/18/gm-recalls-118-million-suvs-over-airbag-issue/ which talks about the ignition switch recall as well as the new recalls.  Suffice it to say GM is either going to be viewed as careless and faulty, or as taking the problems seriously and attacking them head on.

No matter which way the general public views GM, they are really putting a full effort into changing the way they are addressing recalls and ensuring their vehicles are without faulty equipment.  Mostly this new wave of recalls is a preventative program and no accidents or fatalities have been linked to the new recalls.

Regardless of this new set of recalls, the focus still remains on the twelve fatalities and lengthy investigations surrounding the ignition switch recall.  According to records, GM was investigating the ignition switches as early as 2004 and may have to incur criminal prosecution if found in negligence.

Although these recalls loom heavy over the head of GM, they are pushing forward and looking forward to another profitable year in 2014, but much of that profit may end up tied up in litigation, fines, and settlements.



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