"Something went wrong with our process in this instance, and
terrible things happened," she told employees in a video message
posted online. Barra said the company is changing how it handles
defect investigations and recalls.
In the last two months, GM has recalled more than 3.1 million
vehicles in the United States and other markets. The actions started
with last month's recall of more than 1.6 million vehicles for
faulty ignition switches. The latest recalls cover airbag wiring
harnesses, brake parts and other components across several models.
The Detroit automaker said on Monday it would take a $300 million
charge in the first quarter, primarily to cover the costs related to
the ignition-switch recall and the three new recalls.
Barra previously apologized for GM's failure to catch the faulty
ignition switches sooner. In Monday's video, she said GM is
"conducting an intense review of our internal processes and will
have more developments to announce as we move forward."
The decade-long process that led to last month's ignition-switch
recall of such older GM models as the 2005-2007 Chevrolet Cobalt and
2003-2007 Saturn Ion has led to government criminal and civil
investigations, congressional hearings and class-action lawsuits in
the United States and Canada. All ask why GM took so long to address
a problem it has said first came to its attention in 2001.
Barra said on Monday that the company was working with the supplier
of the ignition switches, Delphi Automotive, to add a second
production line for replacement parts and that customers would
receive a detailed notice by mail during the second week of April.
The latest recalls cover more than 1.5 million newer crossover
utility vehicles, luxury sedans and full-size vans. While there were
reports of engine compartment fires in two dealer-owned Cadillac XTS
sedans, the company said it has received no reports of accidents or
injuries related to the three new recalls.
GM said the latest recalls include 1.18 million mid-sized crossovers
to repair an issue that could lead to the nondeployment of side
airbags. It said it will repair the wiring harness of seat-mounted
Affected are some 2008-2009 and all 2010-2013 Buick Enclave and GMC
Acadia crossovers, some 2009 and all 2010-2013 Chevrolet Traverses
and some 2008-2009 and all 2010 Saturn Outlooks. Most of the
vehicles were sold in the United States, but some are in Canada and
The automaker also is recalling 303,000 Chevrolet Express and GMC
Savana full-size vans to replace plastic material in the passenger
instrument panel to meet federal head-impact crash standards for
unbelted passengers, a spokesman said.
Affected are vans from model years 2009 through 2014 that are rated
to carry up to 10,000 pounds including the vehicle's own weight, the
spokesman said. Most were sold in the United States, but also in
Canada, Mexico and other markets.
In the XTS, a brake booster pump wiring issue can lead to
overheating, melting of plastic parts and a possible engine
compartment fire, the spokesman said. There were two reports of
fires in unsold cars on dealer lots in June and September last year
as well as two cases of melted components.
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Affected are 63,900 of the 2013 and 2014 luxury sedans, mostly in
the United States, but also in Canada, Mexico and a small number in
the Middle East, the spokesman said.
GM said the new recalls resulted from Barra's push for a
comprehensive internal safety review following the ignition-switch
"I asked our team to redouble our efforts on our pending product
reviews, bring them forward and resolve them quickly," Barra said in
a statement on Monday.
On Friday, the automaker was hit with what appeared to be the first
U.S. class action related to the ignition-switch recall, as
customers claimed their vehicles lost value because of the ignition
switch problems. The proposed class action was filed in a Texas
federal court. Other plaintiffs' lawyers say they are preparing to
file similar cases in the coming days.
GM shares closed 1.6 percent higher at $34.63 on Monday on the New
York Stock Exchange. Last week, the shares fell 10 percent.
Analysts have called the media coverage of the ignition-switch
recall and resulting sell-off of GM stock "overdone."
"We think much is being made in the media about recent recall
headlines, but in short, we believe GM is doing a good job balancing
its ongoing investigation while taking steps to prevent further
vehicle related incidents by proactively announcing new vehicle
recalls," Stifel analyst James Albertine said in a research note on
"There is clearly a target on GM's back, in our view, given its
highly publicized government-sponsored bailout and its
industry-leading market share position."
Barclays analyst Brian Johnson said the risk of market-share loss
increased because the latest recalls include newer models on dealer
RBC Capital Markets analyst Joseph Spak said the charge for the
recalls worked out to less than $100 per vehicle, but the greater
risk was the potential damage to GM's reputation and whether that
would force the company to offer higher incentives to customers to
defend its U.S. market share.
(Reporting by Ben Klayman; editing by Matthew Lewis)
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