GM lifts stop-sale order on Cruze as probe continues

PRIMER
Related Links
Related Stories
Related Topics

DETROIT (Bloomberg) -- General Motors Co., which has recalled a record number of vehicles in the U.S. this year, lifted its temporary stop-sale order on its top-selling Chevrolet Cruze sedans as it evaluates the vehicles for a new type of airbag problem.  

About 33,000 vehicles may have received potentially faulty airbag modules supplied by Japan’s Takata Corp., Jim Cain, a GM spokesman, said Wednesday. GM ordered Chevrolet dealers earlier Wednesday to stop selling 2013 and 2014 Cruzes because airbag modules may have an incorrect part.

That order was lifted later Wednesday after the specific vehicles were identified. GM is working on a likely recall of those cars, according to a person familiar with the process who spoke on the condition of anonymity.

Takata, a Tokyo-based supplier, made airbags that led to millions of vehicle recalls by automakers including Honda Motor Co. and Toyota Motor Corp. Honda, for example, has said its recall was for flaws related to inadequate pressure and excess moisture. GM’s problems are different, Cain said.

“We are working to resolve a mechanical issue,” he said in an e-mail. 

GM’s stop-sale order conflates two of the largest recall issues in the global automotive industry this year and threatened to expand the automaker’s recall crisis to its most popular car while further exposing the Japanese supplier to more unsatisfied automakers. 

‘Perfect Storm’ 

“This is exactly the perfect storm when you have two companies the size of General Motors and Takata, which has supplied multiple OEMs, having massive recalls,” Dennis Virag, president Automotive Consulting Group, said in a telephone interview. “It’s just a situation that is beyond comprehension.”

GM has redoubled efforts to ensure its vehicles are safe following the slow recall of 2.59 million compact cars linked to at least 13 deaths. GM said it has recalled 20 million in North America through June 16, including 17.7 million in the U.S.

The company’s crisis erupted in February with the recall of some small cars it no longer sells, including the Chevrolet Cobalt, that have a defective ignition switch that could be jarred into the “accessory” position, disabling power steering and preventing air bags from deploying.

‘Big Problem’

“In the manufacturing industry, all kinds of problems can happen, but what’s important is you deal with it seriously when you have a problem like this,” said Satoshi Okumoto, CEO of Fukoku Capital Management Inc. in Tokyo. “If it’s just a simple mistake, it may not be a big issue but if there are wrongdoings that companies normally don’t have, then it could be a big problem.”

Takata can’t comment amid an investigation, though it apologizes for concerns it caused customers, said Toyohiro Hishikawa, a Takata spokesman in Tokyo. 

GM has not yet said whether it will recall the Cruzes. U.S. sales of the car rose 4.4 percent last year to 248,224, making it GM's top-selling sedan in the U.S., according to the Automotive News Data Center.

“We are working through all of the issues associated with the part in real time, and we will move as quickly as possible as we stitch the facts together,” the company said.

Contact Automotive News

Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

Or submit an online comment below. (Terms and Conditions)




Rocket Fuel