Dallas, Texas 03/06/2014 (FINANCIALSTRENDS) – General Motors Company (NYSE:GM) in a rare move is recalling around 1.37 million cars that were rolled from 2007 or earlier. The recall is directed due to a potential defective ignition switch existing since 2004 which GM was aware. These defective ignitions lead to 31 crashes and 13 deaths. The company also issued an apology to the customer for the delayed response and assured them the company will focus on building superior cars going forward.
General Motors Company (NYSE:GM) CEO To Monitor The Recall
The new General Motors CEO Mary Barra will be directing the recall. The new CEO re-assured its employees after the recall a through analysis will avoid similar issues in the future. According to the reports the new CEO will be leading a group of senior executives to plan, monitor the recall and ensure essential alterations are made as required. She also emphasized in a letter to the employees, the company’s reputation will determined by how the problem is addressed and not by the recall itself. GM will be accountable for this issue and ensure customers do not face the problems again.
U.S. Auto Safety Department To Probe Into GM Recall
U.S. government’s auto safety watchdog National Highway Traffic Safety Administration (NHTSA) is investigating GM recall. The agency probe as to why GM delayed to report the problem for a long time, though GM was aware about this issue in 2004 and also the holdup in initiating the recall. As per the US legislation Automakers are supposed to notify NHTS within 5 working days once the safety defect is identified. Under the new legislation which came into effect last year GM could end up paying $35 million. If fined GM will be third Automaker in US paying major penalties. During 2012, Toyota paid penalties and Ford Motors in 2013 for delaying to report safety problems in their vehicles.