GM Recalls 2.7M More Cars; Industry On Record Pace
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DETROIT (AP) — General Motors recalled 2.7 million more cars Thursday and has now recalled more than 11 million vehicles in the U.S. since January, putting the auto industry on track to set a record for recalls in a single year.
GM said the cars are being recalled to fix problems with brake lights, headlamps, power brakes and windshield wipers. GM will take a $200 million charge this quarter, mostly to cover the repairs. Shares fell slightly in early trading.
Along with sizeable recalls from Toyota, Ford, Chrysler and others, GM’s actions have the U.S. auto industry on pace to break the record of 30.8 million recalled vehicles set in 2004. GM also is close to breaking its own U.S. recall record of 11.8 million, also from 2004.
A number of factors are behind the large numbers of recalls. GM is reviewing all of its vehicles for safety issues following a 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.
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.”
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.
Overall, the industry’s approach to recalls appears to be changing. Bob Carter, Toyota’s U.S. automotive operations chief, told analysts last month that car owners can expect more frequent recalls because the regulatory and competitive environments have changed. Instead of recalling cars for known defects, companies are now “recalling vehicles to change problems that we anticipate might happen,” Carter said.
GM’s $200 million second-quarter charge is on top of a $1.3 billion charge it took in the first quarter, mostly tied to recalls.
GM’s handling of the ignition switch situation has subjected it to investigations from two congressional committees, the Justice Department and the National Highway Traffic Safety Administration.
It’s also brought a shake-up in the ranks, with two top engineers leaving the company, two more suspended with pay and Boyer being appointed to oversee safety.
GM shares fell 25 cents to $34.69 in morning trading.
Other GM recalls announced Thursday include:
— More than 140,000 Malibus from 2014, where a software problem in the brake control computer can disable the power brakes. That means drivers would have to push the brakes harder to stop, and stopping distances would increase.
— Nearly 112,000 Chevy Corvettes from 2005 through 2007 because they can lose low-beam headlights. GM says when the engine is warm, an electrical housing can expand and bend a wire, causing it to fracture. GM will also repair Corvettes from 2008 through 2013 if owners have the problem.
— 19,000 Cadillac CTS sports sedans because the windshield wipers can fail after the cars are jump-started and the wipers are stuck by ice and snow.
— 477 Chevy Silverado and GMC Sierra pickups and Chevy Tahoe SUVs. A suspension part can detach from the steering and cause loss of steering.
Thursday’s recalls also cover about 290,000 vehicles in Canada, Mexico and other countries, bringing the global number of recalled vehicles to more than 2.9 million.
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