By on March 13, 2014

2007 Pontiac G5

1.37 million owners in the United States affected by the ignition switch recall issued by General Motors last month will be offered $500 toward the purchase or lease of a new vehicle just as the National Highway Traffic Safety Administration cites a lack of sufficient data as the reason said recall wasn’t issued sooner.

Automotive News and Bloomberg report the cash allowance offer will apply to 2013 through 2015 Chevrolet, Buick, GMC and Cadillac models, with the following explanation issued to dealers in a notice delivered March 4:

GM will not market or solicit owners using this allowance. We ask that you not market to or solicit these customers either. This allowance is not a sales tool; it is to be used to help customers in need of assistance.

For owners opting to have their affected vehicles repaired, a free loaner will be made available for the duration of the repair, as well as free towing to the dealership if so requested. Said repair work is scheduled to begin early next month.

Meanwhile, NHTSA acting administrator David Friedman explained that a lack of sufficient data regarding the ignition switch behind the recall prevented his organization from forcing such a recall out of GM sooner than last month:

If we had that information, if GM had provided us with timely information, we would have been able to take a different course with this. We took several efforts to look into this data.

At the end of the day, with the data we had at that time, we didn’t think that was sufficient to open up a formal investigation.

The NHTSA is facing criticism over their lack of action as of late from both Congress — who are launching their own investigation over the recall — and former employees, such as former administrator Joan Claybrook. Claybrook asked the Transportation Department’s inspector general to look into why “no one [was] evaluating why NHTSA failed to carry out the law” in regards to the issue, which had been known in some capacity to the organization since 2006 when investigators were sent to document a high-speed fatal crash in Wisconsin involving a Chevrolet Cobalt and two women resulting from the switch cutting off engine power while preventing air-bag deployment.

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80 Comments on “GM Offers Cash Allowance, NHTSA Cites Lack Of Sufficient Data Amid Recall Fallout...”


  • avatar
    chainyanker

    If GM really wanted to help its customers, they’d give them $500 towards the purchase of a competitor’s vehicle.

    • 0 avatar
      bullnuke

      chainyanker, ya beat me to it. +1

    • 0 avatar
      NMGOM

      GM wants to give $500 to suspect cars whose owners “need assistance”? And it can even be put “toward a new vehicle”!
      Who are they kidding? That money is a bribe to keep complainants quiet. $500 won’t mean a whole lot towards any new GM vehicle nowadays. If they were offering to take the suspect vehicles back and issue a $5,000 inconvenience/hazard reimbursement that can be applied toward a new vehicle, then maybe GM would have credibility in this matter….

      ——————–

  • avatar
    danio3834

    And the finger pointing intensifies.

  • avatar
    PRNDLOL

    And the affected owners in Canada?

    A free can of belt dressing.

  • avatar
    CoreyDL

    Yeah, because all these people driving little old GM crap cans were just $500 away from that brand new car they actually wanted.

    Not.

    They’re driving these because they can’t afford a new or newer vehicle.

  • avatar
    SCE to AUX

    It’s easy for journalists and politicians to distill 10 years’ worth of obscure car crashes into a concise story that says GM/NHTSA ignored evidence.

    But as I said in a prior thread on this subject, GM’s engineers are addressing a host of issues every day. Thousands of GM cars crash every year, yet we’re supposed to think that 1 or 2 of these each year would initiate an immediate recall – especially in Year One. There is such a thing as ‘statistically meaningful data’, but that doesn’t translate in today’s pop culture.

    However, Delphi and GM both share responsibility for producing and shipping a part that didn’t meet spec.

    • 0 avatar

      There were so many process failures in this matter. Delphi made out of spec parts and their QC procedures didn’t catch them, nor did GM’s. Then, once GM was aware of the problem, they didn’t ignore it. They threw an alphabet soup of various procedures to analyze and find the source of the fault and the best they came up with was to redesign the ignition key so things hanging off the key ring would create less torque. Add in the failure of NHTSA regulators to recognize that there was a problem and this was a clusterfark of massive proportions.

      I predict that this case will end up being studied in business and engineering schools.

      • 0 avatar

        > I predict that this case will end up being studied in business and engineering schools.

        In a complex system such as car composed of thousands of parts, it’s only natural that not every combination of minor deviations can be accounted for. Perhaps Detroit isn’t the greatest at meticulous details but they’re hardly the worst either.

        Consumers who’ve never dealt with complex systems themselves often have the odd expectation that everything *should* function perfectly rather than wonderment at how something like this ever worked at all (which it probably wouldn’t if they were responsible).

        The latter irony would probably make for a far more interesting study than the mundane stuff of arbitrary oversights responsible for most recalls.

      • 0 avatar
        Erikstrawn

        I remember that in the original article I read, every time there was a death reported, GM would conduct tests, the tests would end up “inconclusive” and they would give up until another death occured, then repeat. It gives the appearance that (internally) GM really didn’t care enough to conduct a thorough investigation, and only conducted tests long enough to let things cool down.

  • avatar
    Z71_Silvy

    There shouldn’t be any “fallout”.

    People were their usual stupid selves and had far too much weight hanging from their ignition.

    Driver stupidity is not the fault of GM. If you’re a moron, you will suffer the consequences.

    • 0 avatar
      CJinSD

      Consequences like driving a GM product?

      • 0 avatar
        28-Cars-Later

        I’ll lol at this as it’s clever but inaccurate.

      • 0 avatar

        @CJ: You mean like when Toyotas kamikazi’d their clueless owners and blamed it on floor mats? They should have have blamed it on “Curry Fumes” messing with the throttle controls. Considering 90% of Toyota/Honda/Lexus/Acura owners fall in that category, that would have been more believable scenario. Say what you want about GM car owners. When our co-workers ride in our cars to grab lunch, at least they don’t have to sit through in a car that smells like the inside of a chicken vindallo take-out box and reek after a 10 minute drive.

        • 0 avatar
          CJinSD

          To paraphrase Bill Engvall, here’s your Chevy.

        • 0 avatar
          tonycd

          Is this a dig at some ethnic group or something? I hereby award you the prize for Most Incoherent Post Of The Week.

        • 0 avatar
          Pch101

          Great. Now I have a craving for Indian food.

        • 0 avatar
          Pch101

          On a more serious note, take that racist nonsense of yours and shove it up your tailpipe. There’s no place for that here.

          • 0 avatar

            @PCH. My apologies. Agree that my comment was disrespectful but racist it was not.

            1. I wasn’t the one who started the personal insults.
            2. Calling someone a moron for owning a GM product was in poor taste and I took offense as a 2014 Chevy owner
            3. With nearly 20% market share, I doubt 20% of the car buyers in this country are morons. Though 20% of the country believes Mrs Palin will make a great president, they are not the ones driving around in GM vehicles.

            There is a difference between being racist vs making fun of stereotypes. How different is it from making fun of Corvette drivers with comb-overs, Escalade or MB owners driving around with 26″ rims.
            If you lived in the coasts you would know what I was talking about.

          • 0 avatar
            Pch101

            I am unaware of a stereotype of any sort that suggests that most drivers of Toyota products in the US are of Indian (as in Asian Indian, not Native American) origin.

            (You do realize that vindaloo is Indian, not Japanese, don’t you?)

          • 0 avatar
            CJinSD

            Fun with stereotypes is okay? How about the one that the only people that still settle for UAW cars are jingoistic, racist imbeciles? You really made that one look silly today, except that you did the opposite instead.

          • 0 avatar

            > Fun with stereotypes is okay? How about the one that the only people that still settle for UAW cars are jingoistic, racist imbeciles?

            You know you done mess up when even CJinSD gets to call you out for bigotry.

          • 0 avatar
            Pch101

            “I would like to know who the import humpers would call out for help when natural disasters or terrorism strikes in their town or city. Lets see if the ***Japs*** are going to be bailing out hurricane victims.”

            http://www.thetruthaboutcars.com/2012/03/government-motors-on/#comment-1865657

            There seems to be a pattern here, and that pattern isn’t good.

          • 0 avatar
            alsorl

            Come down to Florida. Every other Toyota commercial is in Spanish. Is that racist ? No. But adding up the typical Toyota driver. Excluding the Prius owners.
            A) Hispanic
            B) Indian
            C) Caucasian- primarily Republican’ s, anti-union. Pro foreign products.

    • 0 avatar

      GM has already announced that the ignition switches supplied by Delphi were out of spec and required less than specified torque to turn the key. The parts were defective.

    • 0 avatar
      DenverMike

      Unless GM drivers are more stupid than any others, this could have happened to any OEM. Point is it didn’t. Safety was severely compromised for the sake of pennies. Had it happened to Ford, you’d be playing a different broken record, over and over and over…

  • avatar
    Johnny Canada

    The fact that GM used the same part number for the old ignition switch AND the new version, makes me believe that there was an attempt to hide the problem.

    You really can’t be shocked, as almost every manufacture has a history of trying to dodge a nhtsa forced recall.

    Oh, and where is Mary Barra in all this? She’s letting the PR department spin tails of her “leadership” to the gushing PC media.

    • 0 avatar
      SCE to AUX

      Or… keeping the same part number makes purchasing, documentation, and inventory control easier – especially for a modest design change.

      This approach is used all the time in many companies.

  • avatar
    johnhowington

    keep it classy GM.

  • avatar
    Pebble

    More cheap Government Motors junk. They occasionally come out with something decent, which makes one wonder why they can’t be consistently good.

    • 0 avatar
      alsorl

      Your precious Toyota has had more recalls then any other brand over the last 8 years. Well probably before this GM issue. I’m not saying GM’s are great by any means. I sold Pontiacs in the 90′s. It would take 2 days to fix the new cars right off the truck before any customer could drive the autos. Loose spark plugs, air vents that would fall out, etc..

  • avatar
    jpolicke

    How is it to GM’s advantage to pay a $500 bribe to owners rather than just replace the key cylinders? The replacement part, while probably of higher quality than the original (low bar here) can’t be too expensive; how much labor are they allowing the dealers to make the change? Lord knows the average thief can get one out in about 15 seconds.

    Are they requiring trade-ins to get the $500? Are they then going to scrap all the trades ala Cash for Clunkers? If they resell them, would NHTSA suddenly be OK with these still-defective cars on the road? Sounds like a possible liability to put these cars back into other buyers’ hands with a known defect.

  • avatar
    Halftruth

    Was it the switch or the key? I thought the key was redesigned to keep the weight at the center and to reduce the pulling force of a heavy key chain. Either way, doesn’t look good.. and the voucher thing is the wrong way to go. Just fix it already.

  • avatar
    Terry

    One thing in these posts, or in some blogs is that whenever a negative statement is made about GM, someone ALWAYS brings up Toyota.
    When my 2 sons were young, and I told one to clean up his room, he would say, “Yeah, mine’s a mess, but look at my brother’s room!!”
    As a dealer tech/shop foreman with years in both domestic and import shops, a couple of things I’ve noticed: 1) owners with the domestic cars view recalls as a PIA and start to doubt their own car-buying judgement, and 2) the import owners LOVE the recalls!–Free parts and labor, free rental, and they like the personal attention.

    • 0 avatar
      28-Cars-Later

      The brand/dealer experience may be part of it. While this is not a recall anecdote, in the early 90s my mother’s ’87 Caravan kept requiring A/C repairs of some kind, the system of which had already been replaced under warranty in ’89. The story she tells me is the dealership effectively gave her the finger on covering what was then the second or third out of warranty A/C repair so she started calling numbers out of the phone book for Chrysler. Eventually after repeated bouncing around with calls she claims she got through to Iacocca’s secretary who put her in touch with a vice president of some kind who heard her out for fifteen minutes on the problem and how the dealership was treating her. I’m honestly not sure how far she truly got in her queries, but when she went to pick up the Caravan a dealer tech remarked to another tech within earshot: “There she is, the bitch who called Detroit”. I’m not sure how it felt at the time, but she wears this comment with distinction today. If this derisive attitude is how the domestic dealers treat their customers when there is a recall, I can see what a PIA it would be. Ironically my mother’s Saturn Ion is under recall for the same malady in the article and yours truly will probably be the one to handle it. Should be interesting.

      • 0 avatar
        alsorl

        Yep dealer experience is a great help in building a brand. The local Dodge and Ford dealers look like crap and the service personnel all look hung over. Yet the Toyota, Hyundai, and Honda dealers look all bright and shiny. Personnel does not smell like cigarettes.
        Then again the local BMW, MB, VW, and Infinity dealers have too be nice and accommodating. Because there customers spend so much time at the dealer with repairs.

  • avatar
    mikey

    @ Terry…..Good comment, always great to hear from an insider.

  • avatar
    Terry

    Thanks, Mikey!
    The cars that get recalled never worry me. It’s the ones that dont get recalled that concern me.
    Imagine buying a smart phone or PC and never getting an update…

  • avatar
    84Cressida

    And the hilarious part is that it expires. “We’ll give you this rebate for your troubles, but only until next year so buy now”.

    I wish Toyota would offer incentives to GM owners with recalls, just like GM did to Toyota during the whole SUA fiasco as a way of pay back.

    • 0 avatar
      ajla

      Just in general, I find the $500 on any new GM vehicle to be more insulting than not offering any cash allowance.

      And, of course, I’M CERTAIN that no car salesperson would ever try to “market or solicit” the $500 to a person in their dealership.

      • 0 avatar
        84Cressida

        $500 dollars is essentially McDonald’s taking off 40 cents from a BigMac. More insulting than anything.

        What I want to know is why do the airbags not deploy when the car is off? I’ve seen videos of cars getting hit hard parked and the bags go off. How come these don’t?

  • avatar

    Time and time again GM and others are given a pass by the NHTSA when it comes to auto safety. There is no question now that the Audi 5000 or the Toyota’s never killed anyone but nonetheless faced severe penalties from the mass hysteria whipped up by the NHTSA and elected government officials. In the present case of the ignition switch there is no doubt that many people have died and that the reported problem could have easily been duplicated and demonstrated by anyone with the simplest grasp of automotive systems. NHTSA didn’t need “more” information from GM in order to verify the likelihood that the ignition switch with a heavy key chain was shutting down the airbag system. NHTSA is at fault here 100% for failing to protect the public and for not enforcing it’s own laws. Enough is enough, from the moment a company has a valid reported safety issue they should morally and legally take immediate action to notify owners and take corrective actions and if they don’t the NHTSA should immediately recall the vehicle and fine the company. This is what the public expects and deserves but for some reason every excuse under the sun is offered and excepted. It’s just ridiculous to think that the NHTSA couldn’t verify these allegations independently of GM. In Toyota’s recall the NHTSA spent millions trying to prove a nonexistent vehicle defect which they knew from prior experience was brake pedal misapplication. When they are faced with a real ignition defect that has killed people they seem incapable of conducting a few simple tests? In this case they couldn’t find a Chevy Cobalt, a rough road and a heavy key chain? The real problem is the NHTSA is failing in it’s duty to protect the public in a capable and equatable manner. Car companies can’t make a perfect product and somebody needs to make sure when they don’t they are made to correct it. That’s what the NHTSA is supposed to do but once again has failed the public. Why?

    • 0 avatar
      mkirk

      I don’t know man, Ford still gets flack for the Pinto.

    • 0 avatar

      > Time and time again GM and others are given a pass by the NHTSA when it comes to auto safety. There is no question now that the Audi 5000 or the Toyota’s never killed anyone but nonetheless faced severe penalties from the mass hysteria whipped up by the NHTSA and elected government officials.

      Toyota was exonerated by the NHTSA much to the chagrin of the piranhas. Consider reading the report before getting whipped into a lather by the same media.

      • 0 avatar

        Read the report? Yes many times my friend – I’d say you need to read the final report on the Audi 5000 and Senate transcipts to get a little more insight. For example, why didn’t Strickland or LaHood tell them about the Audi 5000 in 1986. Why didn’t they show them all the false claims, crying old ladies etc shown on the 60 minutes episode? If they had the Senate hearings would have been over in minutes with everyone realizing it was brake pedal misapplication a conclusion reached 3 years (1989) later in a report co authored by NHTSA and leading experts at the time. With Toyota they forgot to mention to the Senate the history of UA and the conclusions.

        Had NHTSA properly informed the Senate hearings on UA and its causes Toyota would not have been given such a rough ride and the mass hysteria would itself have come to a sudden end.

        Please note CBS would not release to me a copy of the Audi 5000 episode saying it “was on legal hold” The general public needed to see this video at the time and CBS prevented it. Either way NHTSA had a duty to inform the Senate at the time in my opinion and not go along with a dog and pony show and then years later say they knew what the cause was.

        • 0 avatar
          Pch101

          Nobody wants to tell the American people, “You crashed because ur stupid.” Audi essentially did that, and came close to disappearing from the American market as a result.

          And TMC did have issues with the pedal design. The electronics were not a problem, but the pedal design combined with a propensity for brake fade did pose an issue that deserved to be addressed.

          • 0 avatar

            > And TMC did have issues with the pedal design. The electronics were not a problem, but the pedal design combined with a propensity for brake fade did pose an issue that deserved to be addressed.

            In case the emergency situations not caused by stupids mashing the gas would’ve been solved by mashing the brakes.

          • 0 avatar

            I’d say you are 100% correct – Toyota wasn’t about to blame customers like Audi did because they knew what happened to Audi what happen to them if they did – no sales for 7 years, billions lost. As far as pedal design and brake pedal misapplication – all the manufacturers know its a problem but no one is going to risk re-arranging the historical locations of the brake and gas

          • 0 avatar
            Pch101

            There was a genuine issue with fade for those who pumped their brakes. As many drivers grew learning to do just that in the pre-ABS era, it’s best to presume that many drivers will do just that in an emergency situation.

          • 0 avatar

            > As far as pedal design and brake pedal misapplication – all the manufacturers know its a problem but no one is going to risk re-arranging the historical locations of the brake and gas

            What can they do? Putting them on the same side decreases risk of simultaneous application given the mutually exclusive positions. If someone can forgo all muscle memory and cast blame elsewhere, surely they can just as well use the wrong foot.

          • 0 avatar

            > There was a genuine issue with fade for those who pumped their brakes. As many drivers grew learning to do just that in the pre-ABS era, it’s best to presume that many drivers will do just that in an emergency situation.

            I searched through the complete NHTSA report and can’t find anything specifically related to brake vacuum in Toyotas.

            All power brakes work this way so all cars should be similarly effected unless Toyota drivers are particularly stupid.

          • 0 avatar

            > There was a genuine issue with fade for those who pumped their brakes. As many drivers grew learning to do just that in the pre-ABS era

            It’s also worth mentioning the way NHTSA presented the finding is confusing (and frankly wrong) because power-brakes/vacuum issue has nothing to do with ABS per se. All ABS does is pulse the brakes by cutting them off upon lockup, just as a good driver should w/o it by pumping, but faster and better.

            So technically ABS has the *exact same* problem. From a physics perspective there’s no worse outcome by pumping the brakes to generate a given amount of deacceleration. (unless you’re holding down the gas at the same time in which case the longer duration of deceleration via less effective pumping increases the amount of counteracting acc. applied, but this also allows the vacuum to regen somewhat so it’s a wash).

        • 0 avatar

          > Senate transcipts to get a little more insight. For example, why didn’t Strickland or LaHood tell them about

          Take back what I said; before reading anything try to figure out that Senators don’t work for the NHTSA and pretty much say whatever’s populist.

    • 0 avatar
      Johnny Canada

      “That’s what the NHTSA is supposed to do but once again has failed the public. Why?”

      That’s what (insert any name Federal Government department with political appointments and unionized labour) is supposed to do but once again has failed the public. Why?

  • avatar

    The trivialization of accident investigations is pretty ridiculous. Consider how much effort it takes very professional teams of investigators to determine the cause(s) of air incidents, which have generally superior communication/instrumentation.

    It’s true the NHTSA and manufacturers have some rivalry of interest, but regulatory working relationships esp. in large companies outside of the usual politics tend to be more mundane and collaborative than many assume it to be.

    • 0 avatar

      Bender, I’d say a great many people believe NHTSA’a relationships with manufacturers is odd to say the least. When was the last time NHTSA ordered a mandatory recall of a domestic vehicle? Why are “voluntary” recalls allowed? Why do they except limitations on recalls such as “rust belt” clauses? NHTSA used to publish absolutely anything unedited that came in as a complaint and posted it. They had people’s SIN numbers, home addresses, phone numbers etc posted until I pointed this out to them. That was the reason the complaint database was closed for so long. They couldn’t even log a complaint correctly – still can’t.

      • 0 avatar

        > When was the last time NHTSA ordered a mandatory recall of a domestic vehicle?

        In order to demonstrate some sort of bias it’s contingent upon the accuser to show actual difference in the chain of causality against a reasonable control. Note I didn’t bother to verify if your claim is true because that’s not my job in this here discussion.

        Just because that bear-deterrent spray coincides with lack of attacks doesn’t mean it actually works.

        • 0 avatar

          A better analogy would be that people were reporting bear attacks, video taping them and asking for an official to help then 5 years later the official shows up and wants to know whats’ going on and how can they help. Case in point the Jeep Grand Cherokee fuel tank fires – NHTSA and Chrysler were well aware of the problem before 2009 according to Mr. Ditlow yet not much happened until late 2013. Why the wait? it either has a safety defect or it does not.

          • 0 avatar

            > A better analogy would be that people were reporting bear attacks, video taping them and asking for an official to help then 5 years later the official shows up and wants to know whats’ going on and how can they help.

            Exactly, bear attacks are real. Better stock up on that bear-repellent.

            > Case in point the Jeep Grand Cherokee fuel tank fires – NHTSA and Chrysler were well aware of the problem before 2009 according to Mr. Ditlow yet not much happened until late 2013. Why the wait? it either has a safety defect or it does not.

            Wait, so you don’t have a lifetime supply already because it may be a statistically negligible safety concern which warrants further investigation?

            That’s rather the point of the opening post:

            http://www.thetruthaboutcars.com/2014/03/gm-offers-cash-allowance-nhtsa-cites-lack-of-sufficient-data-amid-recall-fallout/#comment-2953474

            The key part of regulatory process is paperwork (ie documentation) of reasonable good faith. There’s a path to walk between sluggish and knee jerk (the same clueless people hate on either just to hate on something), and the investigative paper trail is what determines proper regulatory action. So unless the math shows improper conduct it’s just pointless whinging.

      • 0 avatar
        Pch101

        NHTSA negotiates recalls with automakers. The policy of the current administration is to impose maximum fines on automakers that aren’t proactive and to publicize those breaches, presumably to encourage self-policing and to make up for the lack of funds that are available for enforcement.

        This effort has largely been successful — automakers try to get ahead of these things with voluntary recalls so that they don’t get slammed with major penalties and bad PR. GM is likely to experience what happens to those who aren’t so proactive.

        And perhaps you’ve forgotten what just recently happened with the Jeep fuel tank issues. NHTSA went after Chrysler with both barrels blazing; however, in a rare show of defiance, Marchionne pushed back and negotiated a compromise.

  • avatar
    mcs

    This mess could possibly reopen the bankruptcy. The theory is that since GM failed to disclose the ignition fault and the potential for litigation, they fraudulently negotiated the restructuring agreement. Combine that with criminal charges against managers and subsequent trials – it’s not looking good for GM.

    • 0 avatar

      Maybe the Ford ignition switch fires will finally come to light because of this. How many homes burned down where the cause was determined to start in the garage? It was so common I saw an Aerostar light up in a parking lot.

    • 0 avatar
      Pch101

      All of that is a stretch.

      Liabilities for pre-bankruptcy crashes go to Motors Liquidation. And driver negligence in post-bankruptcy crashes remains a mitigating factor in a lot of these individual cases.


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