The number of recalls for General Motors keeps on getting larger this year, with GM announcing this week the recall of an additional 717,949 vehicles in the United States.
The latest vehicles to be recalled for safety reasons include, among others, recent-model Chevrolet Camaros and Silverados, Cadillac CTS and ATS sports sedans, Buick Regals and LaCrosses.
“These recalls signify how we’ve enhanced our approach to safety,” Jeff Boyer, vice president of Global Vehicle Safety at GM, said in a statement. “We are bringing greater rigor and discipline to our analysis and decision making. If we identify an issue – large or small – that might affect the safety of our customers, we will act decisively.”
GM has had a record number of vehicle recalls this year. The company has recalled some 26 million vehicles in just the United States so far in 2014. Altogether, GM worldwide has announced 60 recalls so far this year, and they include some 29 million vehicles, globally.
It was started by cars that had a defective ignition switch. That defect was associated with some 50 crashes and 13 deaths. GM apparently will pay damages to crash victims from a compensation fund set up in response to the ignition switch issues. Lawsuits are pending on other issues related to the faulty ignition switch.
In the latest recall, some of the cars had problems with power height adjustable systems on seats. Because of a faulty bolt, there has been one crash and three injuries but no fatalities.
Another safety issue in some of the recalled vehicles relates to the welding on the seat’s bracket assembly. That defect has not led to accidents that GM knows about. Another defect relates to front-turn signal bulbs, and still another relates to belt-drive electric power steering. The steering issue led to one crash.
“These recalls will have a significant impact to General Motors’ bottom line,” Eric Ibara, director of residual values for Kelley Blue Book, told The New York Times. “Ultimately the market will judge.”
Meanwhile, GM announced on July 24 that it saw Q2 net income of $200 million, and the company had a $1.2 billion recall charge. Q2 net revenue was $39.6 billion, compared to $39.1 billion in Q2 of 2013.
The company also announced that it took a special charge of $400 million for the GM ignition switch compensation program.
“There is no cap on this program, but this charge is the company’s best estimate of the amounts that may be paid to claimants,” the company said in a statement. “This estimate contains significant uncertainty and it is possible the total cost could increase by approximately $0.2 billion.”
GM remains positive about the company’s recent business performance.
“Our underlying business performance in the first half of the year was strong as we grew our revenue on improved pricing and solid new vehicle launches,” GM CEO Mary Barra said in the statement.
In recent weeks, media reports have estimated that GM could end up paying $6 billion for fines, charges and settlement funds in recall-relates issues, according to InsideCounsel.
The company is facing government investigations, angry members of Congress and multiple legal cases – in connection with product defects and its response to the issues.