GM is recalling 8.23 million vehicles in North America, including Chevrolet Malibus from 1997 to 2005 and Cadillac CTS cars from the 2003 to 2014 model years, for unintended ignition- key rotation. Among the vehicles recalled today, GM said it’s aware of seven crashes, eight injuries and three fatalities. The fatal crashes occurred in older full-size sedans being recalled for the ignition flaw.
It isn’t clear whether the faulty ignition caused those crashes GM said. Shares, which had been temporarily halted, fell 1 percent to $36.27 at 3:38 p.m. New York time. They had traded at more than yesterday’s closing price for most of the day after Kenneth Feinberg explained how the company will compensate victims of an earlier ignition recall of 2.59 million small cars.
“It’s unprecedented,” Karl Brauer, a senior analyst with Kelley Blue Book, said today in a telephone interview. “People are now wondering where’s this going to end, how long is it going to take, how much is it going to cost?”
GM said it expects to take a charge of as much as $1.2 billion for recall-related repairs announced in the second quarter. It took a $1.3 billion charge in the first quarter for recalls.
‘Industry Standard’
The biggest U.S. automaker is stepping up the pace of recalls as it faces multiple investigations for its slowness in calling back the small cars with ignition issues linked to at least 13 deaths. Since that action began in February, the company has recalled other cars for similar issues, accounting for about 9 million of the fixes before today.
“We undertook what I believe is the most comprehensive safety review in the history of our company because nothing is more important than the safety of our customers,” said Chief Executive Officer Mary Barra. “Our customers deserve more than we delivered in these vehicles. That has hardened my resolve to set a new industry standard for vehicle safety, quality and excellence.”
Some of today’s recalled ignitions were worked on by Ray DeGiorgio, the former GM engineer responsible for the faulty ignition switch at the heart of GM’s crisis, Alan Adler, a company spokesman, said in a telephone interview. He wouldn’t identify which of the new recalls involved DeGiorgio, who was one of 15 people ousted by the company after an internal investigation released this month found a lack of urgency in the engineering and legal departments led to GM taking more than a decade for the flawed vehicles to be recalled.
“This all comes from our review that began after the Cobalt,” Adler said today in a telephone interview. “We looked at every ignition switch across the company, some of them he was involved with and some of them he wasn’t.”
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