GM Settles Continuously Variable Lawsuit
More than 90k purchasers of ’02 – ’05 Saturn Vues and ’03 – ’04 Ions have opted for GM’s VTi continuously-variable transmission. And though it’s tempting to trot-out ye olde caveat emptor, GM is taking responsibility for the widespread failure of its cogless boxes. Since the transmissions cost $4k – $5k to replace, and the preliminary settlement covers repairs, car rentals, towing and trade-in losses, plaintiff lawyers reckon GM could be on the hook for up to $100m. Meanwhile, according to Automotive News, GM’s lawyers demonstrate the carefree optimism of their corporate masters, estimating final settlement costs at $10m – $20m. The settlement will include payments to a yet-to-be-determined class of Vue and Ion owners based on the mileage of the vehicle when the transmission failed, and whether owners purchased the vehicle new or used. The vehicles must have failed within 125k miles or eight years of the purchase date. Although GM lawyer Joe Lines was happy to call the $90 – $100m cost “wildly exaggerated,” he declined to provide a failure rate for the transmission. More tellingly, the settlement means that GM must agree with the “exceptionally prone to premature failure” characterization in the original lawsuit.
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"GM has a sense of humor. The burglar alarm that keeps no one out but the owner is built with a copper wire that bends everytime you turn the key to on or off or whatever. The GM folks decided to make that copper wire 26 gauge. I mean thin. Now when this wire fails and it will you will not be able to start your car. Now, every thief in the business knows what two wires to jump for deactivation of this security system. that has now permaneantly shut down your car. The fun part for this $400 joy ride (fix) is the dealer will tell you by law that he has to reinstall this BURGLAR alarm instead of a 25 cent resistor. So you can do this over and over…. By the way if you put in the resistor your key would cost $3 not $50" I had a Grand Am that locked me out and after a 5 minute search on the internet found out which 2 wires that needed attention. Dealer wanted $450 to install a new ignition switch. Pathetic.
I should have read this news post earlier. Our Cadillac DeVille started shitting parts left and right at almost exactly 80,000 miles. And the main seal on the "wonderful" Northstar V8 crapped out shortly after that, leading to a partial engine rebuild, $2500. Remember this is the 100,000 mile tune up engine that didn't last 85,000 intact. Repairs are all about getting people to come in sooner and buy a new car. When everything goes to hell around the same time people are stretched to the breaking point and cave-in and buy a new car. In the end they are always having a car payment. Why let the customer escape the trap? They need your money. I think you hit the nail on the head there. I wish I could prove it but I bet while they still had market dominance they figured out they had engineer their cars to fail at just outside the warranty to keep customers coming and the profits real high. If their cars last too long people don't come right back after 4 or 5 years to buy another one and keep the money flowing.
cdotson's statistical points are correct and I thank you for that. I would add, however, that GM stated the 80,000 mile target as a design point for "major components", not for the entire vehicle. So even if every component individually has a 90% confidence of surviving for 80,000 miles you are still going to end up with a car (or truck) which has lots of things failing by that point. The number of components which goes into a vehicle is huge. In any case, my experience with well maintained GM vehicles is that by the time I (and my friends) hit the 80k mile point there have been multiple over $500 repairs required. My friend's impeccably maintained and gently driven Impala just racked up a $2200 repair bill at the ripe old age of 4 years and 66k miles. The fuel pressure regulator died and the transmission needed the valve body disassembled, cleaned and reinstalled. He had even changed out the tranny fluid every 30k miles instead of listening to GM's 100k mile BS.
The reason Chrysler's CVT is so good is that they don't make it. JATCO (Former Nissan/Mitsu auto trans people) makes it for them. JATCO also makes the Nissan CVT's.