GM recall costs rise to $2.7 billion
Recalls aren’t cheap for any manufacturer to carry out and if you’ve ever questioned that, a peep at GM’s recall costs climbing to $2.7 billion as lawsuits multiply, is all the proof you need.
The Detroit-based automaker has spent $680 million to repair defective ignition switches in 2.6 million cars, and $325 million to rework or replace ignition keys in 12.1 million cars in the nine months through Sept. 30, according to a regulatory filing yesterday. But that’s not all, for last week GM disclosed details of new suits filed against it in Manhattan federal court, where customers have demanded $10 billion for fallen car prices and other damages allegedly tied to recalls of 27 million defective vehicles.
GM denies that recalls triggered price losses in its cars. However, the company and Chief Executive Officer Mary Barra have said, GM will fight all claims except for those by driver’s who had accidents in cars with faulty switches.
Confirmed deaths tied to defective switches have risen to 29 and may spike as new claims are filed before a December deadline set by the automaker for victims to seek money, Kenneth Feinberg, who is handling payments to victims, said last week.
Source: Bloomberg News