By on September 17, 2015

General Motors Renaissance Center HQ

Two sources have told Reuters that the government will levy a $900 million fine on General Motors for its failure to recall and subsequent attempts to cover-up of faulty ignition switches linked to at least 124 deaths.

Criminal charges will be filed against GM for its role in hiding the defect from regulators, but will defer prosecution while the automaker complies with its penalty. The agreement is expected to be announced Thursday.

The massive fine is smaller than the $1.2 billion Toyota paid in March 2014 for its role in concealing that its cars could accelerate suddenly.  Details about the settlement weren’t immediately available. GM may avoid prosecution by complying with the terms set out by the Department of Justice, Reuters reported.

GM still faces more than 200 civil lawsuits connected to the faulty ignition switch. More than a decade ago, engineers learned that ignition switches installed in models of the Chevrolet Cobalt and HHR, Saturn Sky and Ion, and Pontiac G5 and Solstice could stall and prevent the airbags from being deployed in a crash. Engineers failed to recall, then covered up, and failed to acknowledge the scope of the problem.

In all, 124 deaths and 274 injuries were linked to the switch that cost about $1 to replace.

The case against GM has significantly changed a once-cozy relationship that automakers had with government oversight bureaus. 

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24 Comments on “GM to Pay $900 Million For Faulty Ignition Switch Cover-up...”


  • avatar
    WhiskeyRiver

    Didn’t the C4 Corvette kill the most drivers of any car ever built? They should pay for that cover up too.

  • avatar
    milkplus

    “Old GM” or “New GM?”

    • 0 avatar
      DenverMike

      Old GM, New GM, taxpayers, it doesn’t matter. It’s one big cluster of fukk anyway. Except it’s such a relatively minor amount, that it’s not likely to change the way GM, Toyota or any OEM goes about business. It’s like a parking ticket to you or I.

      This is a meaningless business expense for GM. Probably a tax write-off too.

      • 0 avatar
        highdesertcat

        And just like in Toyota’s case, they’ll just raise the prices of their products to offset this expense. However, Toyota builds the better products so that makes this whole mess an absurdity.

        Why charge more for inferior GM products? If you buy one you have got to be worried about what awaits you down the road. Will it kill you or just run badly longer than most other brands?

  • avatar

    TAXPAYERS to Pay $900 Million for Faulty Ignition Switch.

    • 0 avatar
      highdesertcat

      Pales in comparison to $10B lost by taxpayers keeping faulty UAW members working while 25-million other Americans lost their jobs during the Great Recession.

    • 0 avatar
      wmba

      Taxpayers to pay? Exactly how do you figure that when the government owns no shares.

      Voices in your head? The government sold its last shares on Dec 10, 2013.

      Not that many here took any notice.

      • 0 avatar
        Lorenzo

        Well, it’s a cost, so it’ll reduce taxable income. But that’s like saying increases in steel or glass prices are paid by the taxpayer, since they lower taxable income too.

  • avatar
    PeriSoft

    “…Toyota paid in March 2014 for its role in concealing that its cars could accelerate suddenly.”

    I wish my Sonata could accelerate suddenly. :P

  • avatar
    Gardiner Westbound

    Settlements, fines and judgments, even multibillion dollar ones, are simply license fees, costs of doing business. Stiff executive jail terms are much more likely to permanently correct an issue.

  • avatar
    RRocket

    Toyota:

    Verifiable deaths due to UA : 0
    Fine $1.2 Billion

    GM:

    Verifiable deaths due to ignition fault: 150+
    Fine $900 million

    Government motors at work….

    • 0 avatar
      highdesertcat

      If people are dumb enough to buy a GM product, they deserve whatever they get, even if it kills them.

      Personal responsibility goes hand in hand with freedom of choice.

      • 0 avatar
        CJinSD

        My employer was pressuring me to get a GM product as my next company car. Fortunately, I was able to convince him it was an awful POS, with a little help from a power seat switch that seemed like it was going to snap off before engaging a motor. I may still end up with some sort of SRT Fiat, which is just as Darwin-worthy.

        • 0 avatar
          highdesertcat

          I know that Mission Chevrolet in El Paso, TX, gives ginourmous discounts to people who buy GM products. It’s a great place to buy if you’re a GM fan.

          Friends of mine in construction routinely trade their Silverados in for new ones there. Discounts of $10,500 and more off MSRP are common and buyers are urged to trade-in their old vehicles.

          When my best friend was still working, his company took him there to get his new company truck off the new-truck lot, an ExtCab Silverado.

          My friend told me he would have preferred an F150 SuperCab but the price difference was the deciding factor in that buy.

          • 0 avatar
            CJinSD

            Fortunately, we didn’t go to a dealer like that. The Cadillac dealer in Mission Valley thinks anyone that walks on the lot must have a two-digit IQ, so they tried telling us that they can get over list for all of Cadillac’s faltering alphabet-soup of turkeys. A quick demonstration via cars.com that we were being insulted by about a 20% exaggeration of value seems likely to keep me from the ignominy of rolling a GM product.

          • 0 avatar
            highdesertcat

            Interesting. My dad bought his Caddy from Marvin K. Brown and they treated him very well (back then).

            When my #2 son was a CHiP, stationed at the I8/Rosecrans Division, a long time ago, he wanted to buy a Grand Am for his new wife, from Hines Pontiac in Mission Valley, and was met with the same two-digit IQ mentality attitude.

            He ended up buying her a Caprice at City Chevrolet on Morena. His wife liked the people at City right away. Not so with University Ford and Pascal-Dilday.

            He has since switched brands and bought a BMW 328i from Kearney Mesa BMW for her.

            When my brothers were still in the business, I noticed that many on their sales staff had that same two-digit IQ mentality. They thought buyers were stupid.

            Maybe it’s just a California thing.

          • 0 avatar
            CJinSD

            San Diego car dealers mostly seem to stink on ice. The Porsche dealer is an exception, and the Audi dealer was in 2012. When we returned this year, there were no familiar faces and they wanted a deposit to test drive a car even though we were returning a leased A6 with no payment issues over three years. It was an RS7, but so what? I could talk my way behind the wheel of anything when I was a 22 year old punk. The Porsche dealer next door to the Audi place offered me anything on the lot to drive while the A6 was getting an oil change. It’s service like that which put me at risk of driving a Cadillac.

            I’ve seen some horrific stuff here at Mazda dealers, Nissan dealers, Ford dealer, Chevrolet dealers, Honda dealers, Buick dealers, and others I’m probably forgetting. Penske Lexus were jerks when my friend was looking to trade in his five year old 740i Sport. Bizarrely, I know of lots of good experiences at San Diego Toyota dealers, even ones that are part of generally awful dealer groups. Usually, Toyota dealers are the worst element of Toyota ownership.

          • 0 avatar
            highdesertcat

            I have heard great things about the dealerships in Carlsbad and Oceanside. Maybe it is because they cater to the largely-Marine Corps crowd of Camp Pendleton and the better-off-than-the-average-bear curmudgeons of the North County.

            My grandson had a great Honda-buying experience last year with the Honda dealership in/near Kearney Mesa but I think it was only because they were so desperate to get his 2010 Wrangler in trade on a new Accord V6 EX-L.

            And although the dealerships in National City/Chula Vista often will undercut their Mission Valley competition, I found the best pricing vs profit margin ratio to be in the LA area.

            One of my brothers had dealerships in the LA area, another brother in the SF/Oakland area.

            The turn-over of new stock for those two dealerships, like most in those locations, was something that other dealers everywhere could only hope to approach. Stock velocity -> out the door – gone!

            My philosophy in advising them has always been to make the sale. That’s what pays the bills and rings the cash register.

            A condescending attitude does not promote sales.

          • 0 avatar
            CJinSD

            I drove my friend to an LA Honda dealer to pick up a rare color/manual transmission combination that a salesman confirmed was in stock. He had an appointment to pick up the car. When we got there, the dealer had the same inventory as all of our local dealers. Supposedly, the car had been sold out from under my friend, but some digging on Honda’s inventory system showed it hadn’t existed. There really aren’t any good enough reasons to go to LA. I think that was my last trip there, and it was in 2012.

            The Kearney Mesa Honda dealer, Pacific Honda, is where he ended up getting his car. It wasn’t the color he wanted, but why exactly the LA Democrat thought he would buy the same car after getting lied to and making a 250 mile round trip is beyond me. We made a point of scaring a few other customers off the lot while we were in HellA too. Pacific Honda used to give great service, but when the economy got bad they tried making up for lost sales with expensive service. I haven’t used them in years.

  • avatar

    Can someone tell me the reason why Toyota had to pay a higher fine? Or GM that low a fine?


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