A record fine of $35 million U.S. will be paid out by GM after a government investigation into how GM handled the recall of 2.59 million vehicles over faulty ignition switches. GM’s agreement with regulators also includes significant changes into how the automobile manufacturer reviews safety problems and decides when to issue a recall.
- G.M. will be required to meet monthly with regulators and provide a list of every safety problem under consideration, as well as report on any new communications with their dealers.
- The company must also improve information sharing across its different units, make recall decisions more quickly and revise its analysis practices to improve the ability to identify safety issues.
David Friedman, acting administrator of the National Highway Traffic Safety Administration (NHTSA) said that GM’s treatment of safety concerns was found to be “deeply disturbing”. Reviews of internal company documents showed that G.M. had known since at least November 2009 that faulty ignition switches were prone to turn off and he quoted GM training presentations that encouraged employees not to use word and phrased with negative overtones. The announcement of GM’s fines will put all automobile manufacturers on notice that they will be held accountable if they fail to quickly report and address safety defects.
Since the ignition switch recall, General Motors has announced four more separate campaigns for an additional 2.42 million vehicles. The automaker has now recalled over 13.6 million vehicles in the United States under 29 separate campaigns in 2014.
