GM’s Corporate Image, Balance Sheet At Risk During Ignition Switch Recall: Opinion Desk
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As the National Highway Traffic Safety Administration (NHTSA) investigates (and gets investigated) General Motors for the ignition switch recall tied to 13 deaths, there is a possibility that the organization could fine the automaker $35 million. And even though the fine would set a new record for the industry, it’s not what GM should fear the most.
Instead, The General’s worst fear most likely involves money-hungry lawyers looking to make a name and some money for themselves with product liability litigation. As of this writing, only one case has been filed, but we’re certain that more will surface in the coming months. In addition, scrutiny of the recall has expanded beyond the regulators at NHTSA, with two congressional committees having announced plans to examine the issue, and the Department of Justice also reportedly looking into the matter.
Even so, The General could potentially face an even bigger problem: as investigations, lawsuits, and associated media coverage continues, these events could tarnish GM’s corporate image, which has lately been on the upswing thanks to new products and the government’s divestiture in GM following the automaker’s 2009 bankruptcy. So in the grand scheme of events, it’s possible that the fine by NHTSA could end up being a slap on the wrist for GM when compared to some of the other, non-governmental repercussions.
Stay tuned to GM Authority for the latest GM news, and for continuous coverage of the ignition switch recall, as well as the second wave of recalls announced today.
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I do not know how it works justice in USA, but I think something serious by GM not take charge of re-designing the system on, morally knowing the problem is a very serious offense.
I guess it was something of the old GM Executives, surely they already saw that GM sank and did not care.
But the new GM see unfair to pay for the crimes of previous leaders, justice should condemn these executives
Regards from Spain
I feel for the families who had someone perish in any accident for which the airbags did not deploy because of this cause, I really do.
But the reality is that even NHTSA investigated the reports of this issue back then and they themselves found no evidence that the switches were directly at fault. So what is GM to do if NHTSA can’t even determine the cause?
But no doubt some ambulance chasing lawyers will be all over this and the publicity will be 100 times worse because of it.
I work at a dealership and I can’t tell you how many times we have vehicles in with ignition issues and when the customer hands you their keys, the darn things weigh 5 lbs. The worst I’ve seen is one key and one key fob for 2 different vehicles plus 17 other keys (for various things such as house door, garage, sheds, etc) all on one set of keys. And then the customer gets upset when there is an issue with the tumbler set or safety items in their ignitions systems.
I won’t drop one tear of the people that got put out to pasture! Darwins theory at it’s best! Maybe those people should of learned how to drive!
GM s should not be responsible for people not being able to to control their cars!
Don’t give me this crap that the car lost power, cars lose power everyday for all kinds of reasons and those people seem to find a way to get their cars slowed down and pulled over to the side of the road!
Just stop the money grab!
Ya know, You hit the nail dead on the head. I too, have seen many, many, many people who have the car keys on a ring or rings that will clearly weight over 4 to 5 pounds. One look at the outside of the steering column will show how 5 pounds of metal keys have scrubbed off all the pain and some metal. You can take a magnet and place it on the floor under the ignition switch and the magnet will be partially coated with tiny steel fragments of the keys and left behind you’ll find a lot of aluminum which is directly from the column and the switch.
I believe that all customers be protected from accidents, but not if they are going to cause them on their own. My Corvette will do close to 140 MPH, but if I’m going to drive it to that speed on regular highways I’m going to kill myself and most likely other too. This is going the way of the “Toyota unintended acceleration phonon” No Toyotas ever purposely accelerated without a floor mat stuck up against it, I have driven everything from a Rolls-Royce to a Yugo and I have NEVER driven any automobile that could not be pushed from Drive into neutral with a simple push of your palm. But for the simple reason of ambulance chasing lawyers, Toyota caved in and paid out a ton of money to the ignorant who should be forced to ride public transport since they are too stupid to operate anything more complex than a vacuum cleaner.
And for GM, this will go down in the books as it did in 1977 when some guy who bought a 76 Pontiac Catalina opened the hood one day and was looking at a chevy 350 engine instead of a 350 Pontiac specific engine. He took GM to court and won a very nice settlement. And from that day forward all large GM sedans or whatever have a statement on the second page of the owners manual that reads “This automobile is made by General Motors and has a variety of parts of and from different brands of General Motors!”
Only now, on page 36 of the manuals “Operating your whatever car, Do not have a keying weighting over one pound hanging from you ignition switch or risk bodily harm to yourself and your passengers” Every owners manual already says do not drive your car with a flat tire but is that ever taken seriously ??????? Of course not !
The same Chevy jokes here are Opel jokes in Europe. Never been to Asia but I am sure there are some good ones about Daewoo.
GM has never been known to build quality at any point in time or place. The fact they are junk are part of the charm. I own four. The only difference between old and new GM is the fact they suddenly want an arm and a leg for said junk when you buy it.
Although the pre-2010 GM vehicles had some that were very well known for issues, the 2010 and up models have by majority been great vehicles. Yes, there have been recalls, but even Honda and Toyota have recalls by the hundreds of thousands in vehicles.
The current Equinox has been a great vehicle as the increasing sales numbers would indicate (still increasing in its 5th year). The Cruze has been a very good car also with very solid sales numbers. The Sonics have very few issues (especially compared to the junky Aveo previously), and so forth.
According to JDPowers reliability rating, GM won the large CUV, large premium CUV, HD and LD trucks, large car and large luxury car awards this year.
Consumer Reports also did their Car-Brand Perceptions Survey based on customer’s perception from owning the brand in which Toyota finished first with 145 points, Ford with 120, Honda with 109 and Chevrolet with 105 (the closest Chevrolet has ever been). Honda declined again this year by 12 points and Chevrolet actually jumped 13 points.
Consumer Reports also ranked the 2014 Impala as the top ranked sedan in the market and tied it for 3rd in overall vehicles with the Infiniti G37.
So some other very informed people would have to disagree with you (because they did the surveys/testing) about the newer GM vehicles.
But then again Magirus, I don’t think I’ve ever read a positive statement about GM from you on gmauthority (we all know you don’t like the new GM). But you do keep the discussions entertaining.
Then why arent other manufactuers having problems if heavy key chains are to blame?
Brandon,
Actually they do have issues with heavy key chains. When I worked for Ford in the early 2000’s, it was right in their owner’s manuals warning customers about heavy key chains and the issues it can cause with ignition systems.
Plus the 2008 F150 my brother owned had to have the tumbler set replace (he works construction and has a very heavy key chain). My wife’s best friend called me last week in fact to ask if her Toyota dealer was feeding her a line because her security system wasn’t working on her vehicle and they told her the ignition set was worn due to the very heavy key chain set she has.
It just happens to be that in the GM design, the warn tumbler set allows the ignition to jump back a notch to the accessory position which shuts the car off. This is the same thing that was happening to by brother’s F150, only he didn’t crash with it so no accidents were reported. But if he had, his airbags wouldn’t have deployed either.
GM was ninth last year in recalls. Toyota was #1 again.
This too shall pass. The only think keeping this alive for now is the media and they will tire of it as most in the public do not care unless they own one.
Now if this were on cars still in production then it would be a different story but these cars have been gone for nearly 7 years or more so it is not a hot button to most.
It will cost GM to fix them as they have already announced but it is the cost of doing business. Just look a the major Honda recall and others they all account for it as it is part of the business.
Ignitions failing due to heavy key changes have been an issue for years. Generally they do not kill power but the keys can jam and not come out or even not turn to start or shut off the car.
GM will survive this and as soon as they have the replacement parts in May things will go away In the media.
Ford is about to eat Gm alive with the new f150. These recalls are gonna affect the way people look at GM. They knowingly concealed the other manufactuers didnt and if they did it wasnt for a damn decade. There new truck caught fire and couldnt even outsell the old f150. Game set match boys. They had to set aside 300million just for a qtr. Holy crap!! Wait till the law suits start.
I wouldn’t be so fast to declare the new F-150 a success. It doesn’t launch until Q3 of 14 and has so far sold zero units.
Brandon the new Ford will come and go and the rankings of the trucks will remain nearly the same.
The only people who really care here are those who already hate GM and those who own these cars. GM will fix the cars brought in and to be honest at this point half of the ones on the road yet will never even be brought in.
Time to stop being so dramatic and really deal with the real numbers and get over the media hype.
Once they find the missing plane and or Putin moves into another country this story will be forgotten.
More people died in the Ford tire issue and the Crown Vic and they too faded away with little long term harm. At this point no one can tell how many died and or even the other circumstances of the accidents of the claimed dead. We are even with the false inflated number looking at .00022% of all cars built suspected in a death.
Now if this was the new Malibu or Regal then it would be a bigger issue to GM.
Lawsuits are just part of the business.
People never remember what happen to a company years down the road, I never hear people talk about what happened to Toyota last year!
So like they have said before this will all blow over and GM will be selling cars like normal!
GM fixed my brothers Cobalt two weels ago. He told them it shut off on him.once, they came and got it and left him some gokart looking thing to use.
Excellent.
Scott, I understand your point regarding American’s short attention span. However, I believe that you would feel differently if a member of your family had died, or was seriously injured because of a faulty ignition switch. Yes, lawsuits are a cost of doing business; but, it’s best when they can be avoided and safety prevails.