On Monday, General Motors CEO Mary Barra released a video message for GM employees announcing the recall of 1.5 million vehicles due to faulty engineering.
In her message, Barra stated that “Something went wrong with our process in this instance, and terrible things happened.”
Those terrible things include at least 12 deaths and more than 30 injuries of those who were driving vehicles involved in the recall.
The 1.5 million vehicle recall on Monday applies to multiple sectors of the GM brand:
– Multiple cross-over SUV’s, including the Buick Enclave and GMC Acadia, are being recalled due to faulty construction of the air bags which does not allow them to deploy when the service light is lit on the dash.
– More than 300,000 vans are being recalled due to the material on the instrument panel not being protective enough during a crash.
– 63,900 Cadillac XTS’s are being recalled due to a faulty brake plug, increasing the likelihood of an engine fire.
Unfortunately for GM, this is its second recall in as many months. In February, GM announced a recall for more than 1.6 million vehicles due to an ignition failure which would allow one to turn-off the vehicle while driving, disabling the air bags in the vehicle.
Ignition switch recall update: Be cautious when speculation is presented as fact. More on our FastLane blog: http://t.co/jFYKwg39RH
— General Motors (@GM) March 15, 2014
In all, these recalls will cost GM upwards of $300 million during the First Quarter of 2014. However, there may be much larger consequences.
GM currently finds itself in the midst of an investigation from the Justice Department of the United States due to how the company handled the initial recall announced last month.
Reports have surfaced indicating that GM knew about the faulty ignition switch in the Chevrolet Cobalt and HHR, Pontiac G5 and Solstice, and the Saturn Ion and Sky as early as 2004.
If the Justice Department finds that GM did not respond to the faulty ignition switch promptly enough, it could face a $35 million fine.
Despite the losses, Barra believes that GM is doing its best to handle the situation, stating “The bottom line is we will be better because of this tragic situation if we seize the opportunity. And I believe we will do just that.”
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