GM will take a $300m charge over the recalls of more than three million cars

GM to take $300m hit over recalls

General Motors will recall another 1.5 million vehicles after recalling 1.6 million last month due to faulty ignition switches linked to at least 12 deaths.

The USA’s number one carmaker expects to take a $300m (£180m) charge in this quarter, to cover the cost of the new recalls as well as last month’s recall of cars with faulty ignition switches that could cause the engine to shut down and disable the airbags when jostled, sometimes while the car was travelling at high speed.

The firm did not provide a breakdown of how much was related to the ignition-switch recall of older vehicles and how much was to do with the three latest recalls of newer sport utility vehicles, luxury sedans and full-size vans, which followed chief executive Mary Barra’s request for a comprehensive internal safety review.

While there were reports of engine compartment fires in two dealer-owned Cadillac XTS sedans, the company said it has received no reports of accidents or injuries related to the three new recalls.

"I asked our team to redouble our efforts on our pending product reviews, bring them forward and resolve them quickly," Barra said in a statement. "That is what today's GM is all about."

She previously apologised for how GM handled the ignition switch recall and said the company would take an "unvarnished" look at the process while making customer safety and satisfaction the top priority.

"We are conducting an intense review of our internal processes and will have more developments to announce as we move forward," Barra said today.

The ignition-switch recall has led to government criminal and civil investigations, an internal probe by GM and preparations for hearings by Congress asking why GM took so long to address a problem it has said first came to its attention in 2001.

GM has said it received reports of 12 deaths and 34 crashes in the recalled cars, although safety advocate groups have urged a deeper investigation, arguing the number of fatalities involved has been understated.

Last Friday, the Detroit automaker was hit with what appeared to be the first lawsuit related to the ignition-switch recall, as customers claimed their vehicles lost value because of the ignition switch problems. The proposed class action was filed in a Texas federal court.

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