By on April 21, 2014

File photo of General Motors logo outside its headquarters at the Renaissance Center in Detroit

Reuters reports a lawsuit related to the 2014 General Motors recall crisis filed in federal court in California has placed airbag supplier Continental Automotive Systems U.S. at-fault for its role in the recall. Attorney Adam Levitt of Grant & Eisenhoffer proclaimed the supplier knew about the out-of-spec ignition switch at the heart of the recall as early as 2005, yet “did nothing to redesign its airbags” to deploy even when electrical power was cut, “nor did it warn NHTSA or the public.” Continental joins Delphi Automotive as the second supplier to face a lawsuit linked to the ongoing recall crisis.

Between the National Highway Traffic Safety Administration and GM, Automotive News says the former found itself pushing the latter on a number of occasions to do more than issue service bulletins, regional recalls, warranty extensions and customer-satisfaction campaigns regarding problems ranging from corroded fuel filler pipes in full-size vans and risks of fire from door modules in fullsize SUVs, to malfunctioning airbags in Camaros and Malibus and the aforementioned ignition switch affected over 2.26 million 2003 – 2011 vehicles to date. In a 2013 email released to the public by the ongoing Congressional investigation into the recall, NHTSA Office of Defects Investigation director Frank Borris expressed his frustration with the automaker to GM executive Carmen Benavides over GM’s slow approach to communication and action, as well as needing more provoking to do more than the least amount of effort to resolve an issue.

In more NHTSA/GM news, The Detroit News reports the agency has closed the book on its four-year investigation of 334,000 2004 – 2007 Saturn Ions regarding steering problems after the automaker announced they would recall the cars. Four service bulletins linked to power-steering repairs will be issued by GM, affecting the Ion and Chevrolet Cobalt, as well as the Saturn Aura, Pontiac G6 and Chevrolet Malibu. A total of 10 crashes linked to power-steering failure — with two resulting in injury — 4,787 complaints and 30,560 warranty claims were discovered by the NHTSA during the investigation.

As for bringing the affected vehicles in for service, Automotive News reports GM-affiliated and non-GM dealerships are having a rough time with the recalls, citing a lack of parts, growing backlog of recall-related repairs, and lost sales and dealer-related financing. However, GM President Dan Ammann says the main recall hasn’t had a “measurable impact” on overall sales, citing a 4 percent truck-led U.S. sales gain in March and a “decent start” to April’s sales. That said, Ammann has not ruled out a future impact from the recall news.

In the meantime, GM will invest $12 billion into China by 2017, with plans to boost production capacity 65 percent by 2020 based on expectations of the local market to reach 33 million to 35 million new vehicles made per year by the start of the new decade, which Ammann claims will be double that of total projected U.S. demand at the same time. The expansion would total capacity to 8 million units per year, fueled by 60 all-new or refreshed products introduced to China between now and 2018, including 11 new utility vehicles — such as the Chevrolet Trax — and a new Cadillac model every year through 2016.

Finally, The Detroit News reporter Henry Payne took to heart GM CEO Mary Barra’s statement before Congress about allowing her son to drive an affected Cobalt so long as the key was by itself in the ignition switch, turning up at a local dealership to drive an affected 2006 Cobalt to see for himself what would happen. In short: Nothing involuntary, as Payne had to put the switch into the “accessory” position himself to recreate what may have happened in the reported accidents and fatalities linked to the switch.

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23 Comments on “GM Sales Unaffected By Recall, Reveals China Expansion Plans...”


  • avatar
    28-Cars-Later

    Today on As The Bowtie Turns.

  • avatar
    gtrslngr

    ” GM President Dan Ammann says the main recall hasn’t had a “measurable impact” on overall sales, citing a 4 percent truck-led U.S. sales gain ”

    Seems to me Mr Ammann is more than just a little bit out of touch with the man on the street / GM dealerships / GM’s customer base when it comes to sales not being affected by GM’s recent debacles : along well as the fact that GM trucks are lingering on the lots despite incentives and discounts

    Oh well . Yet another round of ” The Year of Delusional/Magical Thinking ” brought to you by those fine folks at GM partaking a little too often at those Dr Tim infused drinking fountains in and thru out GM .

    Their Mantra being ;

    ” If we say it enough times and loudly : it shall be so ”

    And to add insult to injury . Once again the NHTSA letting GM off the hook . Whereas had it been Toyota , Honda , Nissan or any other foreign automaker the fines , penalties and investigations would be flying like gnats on a wetlands nature trail

    Next up no doubt . Delusional commentary from the raft of GM apologists/shills/cheerleaders/true believers on site

    Ahhh … the Cult of GM ! ” Eyes Wide Shut ” pretty much summing them up in a nutshell

  • avatar
    KixStart

    Last night, I noticed a TV ad for a law firm regarding the GM recall. I believe the number was 1-800-3-BAD-CAR. I guess 1-800-4-BAD-CAR is taken.

    What I found interesting is that I don’t recall the lawyers gearing up for a feeding frenzy quite this way over any Toyota recalls. Perhaps the laywers thhink there’s more dead and ingured to be found and used… I mean represented. Ka-Ching!

    I took a look at Henry Payne’s article. “I drove it according to GM specs: Key in the ignition and only a companion fob hanging from the chain.”

    The idea of a “spec” for what’s hanging off your key remains ludicrous.

  • avatar
    Truckducken

    Sue everybody!

  • avatar
    carguy

    Toyota didn’t see much of a sales impact from its media attention of its recall and nor will GM.

    GMs strategy at this point is to mitigate their liability and keep the hordes of lawyer vultures at bay.

    Just like the Toyota incident the brand will move on, there will be a fine, some lawyers will get rich but the owners of the affected vehicles will not see much in the way of compensation.

    • 0 avatar
      sunridge place

      ‘Toyota didn’t see much of a sales impact from its media attention of its recall and nor will GM.’

      Well, the US industry did increase 11% YOY 2010 vs 2009 and Toyota/Lexus was essentially flat. The highest heat on Toyota was in early 2010 and their biggest problem was the fact that some of the impacted vehicles were current models. Ten percent is definitely an impact if you want to place their recall as the primary cause. Can’t think of anything else that would have kept Toyota flat in 2010 vs 2009 while the industry began the recovery.

      • 0 avatar
        APaGttH

        Ahhh, but how much of that “flat” was due to extended stop sell orders and extremely tight supply due to the Japanese earthquake and tsunami.

        Even the TTAC overlords predicted that all the negative press would have little impact.

      • 0 avatar
        carguy

        When the lack of negative impact is hard to prove or quantify then it probably wasn’t a great impact.

        • 0 avatar
          sunridge place

          10% of Toyota’s US sales back then was around 175,000 units.

          Assume an average of $25k invoice price, its about a $4 billion hit.

          To be conservative, assign half the hit to the ‘recall’ hysteria, and you have a $2 billion hit against Toyota’s annual revenues of over $200 billion, it was a drop in the bucket.

      • 0 avatar

        This is perhaps in large part why Toyota decided to pay off the Justice dept rather than drag the at best margin case out in the court of public opinion.

  • avatar
    jpolicke

    Someone please explain to me why Continental is being dragged into this. Are they somehow at fault for making an electrically powered device that fails to function in the absence of electricity?

    • 0 avatar
      DenverMike

      Airbags are designed to work (energized) when power is lost, up to 20 minute. But turning the airbags OFF is a different story. They won’t deploy with the ignition in the ACC position. Not usually a problem with cars and car crashes. But Continental knew about this potentially fatal reality in ’05, but sat on their hands.

      • 0 avatar
        wmba

        “But Continental knew about this potentially fatal reality in ’05, but sat on their hands.”

        There is no QED in your statement. What was Continental guilty of? Absolutely nothing.

        GM was the aggregator of all systems in this car, and the last thing they would want is some idiotic suppplier/designer taking matters into their own hands on a subassembly and possibly introducing totally unexpected effects that nobody could have foreseen. No, behavior like that is just not on.

        GM is at fault here, if any blame is merited. If Continental produced an airbag that fully met GM’s specification, that’s the end of their obligation, period. Second guessing not allowed. The people suing Continental should be advised to take a hike because their claim is ludicrously ridiculous.

        But then, with the level of technical sophistication the average person and lawyer has, they’d sue the sun for rising a minute late.

        • 0 avatar
          DenverMike

          When did I say Continental was guilty of anything? But it’s a bit disgusting that they could see there was a huge problem, and deadly problem, with GM’s defective ignitions, but did nothing. I’m not saying it was their job to act on GM’s problem, but who the heck knows what was said to GM and who was told to mind their own damn business? Parts suppliers also don’t want to lose their contract by going to NHTSA. But who says Continental didn’t go to NHTSA and GM with what they found? That’s what investigations and court proceedings are for.

          • 0 avatar

            > When did I say Continental was guilty of anything?

            Here I was thinking they were accessory to murder.

          • 0 avatar
            DenverMike

            >>Here I was thinking they were accessory to murder.>>

            “Guilty” in the moral, ethical, spiritual, and or biblical sense. Not in the legal, court proceedings, indictable way.

      • 0 avatar
        Exfordtech

        Not sure about this particular model, but many vehicle supplemental restraint modules get their vehicle speed info from the powertrain control module. I don’t know if Continental should be held responsible for lack of deployment, but the failsafe functions should be in GM’s hands in my opinion.

    • 0 avatar
      APaGttH

      Lawyers want leafy greeny money.

      The aggrieved parties will get a $10 gift certificate to Shakey’s Pizza and a $500 off coupon on their next GM product with a MSRP price of $40,000 or above.


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