GM recalls 2.7 million more cars; industry on record pace
By Tom Krisher, AP
May 17, 2014, 12:06 am TWN
DETROIT--General Motors recalled an additional 2.7 million vehicles Thursday as a deep dive into safety issues at the nation's biggest automaker turned up more problems with some of the cars it built over the past decade.
The latest recalls bring GM's total for the year in the U.S. to more than 11 million cars and trucks, close to its annual recall record of 11.8 million vehicles, set in 2004.
The auto industry also is on track to set a single-year record for recalls. Auto companies have recalled 15.4 million vehicles in a little more than four months. The old single-year record for recalls is 30.8 million vehicles in 2004. Toyota, Ford, and Chrysler also have announced sizeable recalls this year.
Several factors are behind the industry's recall binge. GM is reviewing all of its vehicles for safety issues following the recall earlier this year of 2.6 million older small cars with a defective ignition switch. GM knew about the switch problem for a decade before finally issuing a recall. The company links the problem to 13 deaths and faces multiple investigations, including one by the Justice Department, over its handling of the matter.
Industrywide, automakers are moving faster to fix problems than they have in the past in a bid to avoid bad publicity and record fines from government agencies.
Jeff Boyer, the new safety chief at GM, said in an interview with The Associated Press that the company is looking at cases that were under review in its system and moving to resolve them as fast as possible. GM, he said, has added 35 people to its recall review team.
"We're not waiting for warranty trends to develop over time," Boyer said. "It's not only about frequency, it has to be about the seriousness of the potential defect as well."
GM said the new recalls will fix problems with brake lights, headlamps, power brakes and windshield wipers. The Detroit automaker will take a US$200 million charge this quarter, on top of a US$1.3 billion charge in the first quarter, mostly to cover the repairs. Shares fell 2 percent in afternoon trading.
The largest of Thursday's recalls shows how GM is behaving differently. The company is recalling 2.4 million Chevrolet Malibu, Pontiac G6 and Saturn Aura midsize cars from the 2004 through 2012 model years because the brake light wires can corrode, causing the lights to fail. GM says it knew of the problem nearly six years ago, but previously only issued a bulletin telling dealers of the problem and fixed a small number under a service campaign.
The Detroit automaker said it knows of several hundred complaints, 13 crashes and two injuries caused by the problem.