General Motors Agrees to $35 Million Settlement Over Delayed Ignition Switch Recall

GM Recall Settlement

Written by Faith Anderson on May 15, 2014
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General Motors Agrees to $35 Million Settlement Over Delayed Ignition Switch Recall

GM will be fined $35 million for its 10-year delay in recalling millions of potentially dangerous vehicles with ignition switch and airbag problems.

According to federal safety regulators, auto maker General Motors has agreed to pay a $35 million fine to resolve a federal investigation into the company’s delayed ignition switch recall. General Motors had already admitted that it was aware of ignition switch and airbag problems in certain GM vehicles as early as 2004, but failed to warn vehicle owners about the vehicle defects for ten years. The ignition switch problem, which has been tied to at least 31 car accidents and 13 deaths so far, causes some vehicles to suddenly turn of during operation, preventing the airbags from being deployed in the event of an accident. If you have suffered injuries in a car accident involving a recalled GM vehicle, contact an experienced personal injury lawyer today to discuss your possible compensation options.

GM’s Ignition Switch Defect

General Motors has announced multiple recalls over the past few months due to the ignition switch defect, which may cause some GM cars to shut off while driving, disabling airbags, power steering and anti-lock brakes. In 2005, General Motors reportedly developed a partial solution to the problem that would have cost roughly $1 per vehicle, but the company ultimately decided not the implement the repair. In the years since, the ignition switch problem is believed to have caused 31 accidents and 13 deaths, but authorities are in the process of investigating whether defective ignition switches may have contributed to another 300 fatal accidents involving recalled General Motors vehicles, where airbags failed to deploy.

GM Accused of Failure to Warn

As more information has come to light about the problems plaguing certain General Motors vehicles, the auto maker has admitted to the problems and has also admitted that it failed to properly address the issue when it first came to light more than ten years ago. These missteps are what led to the settlement agreement in the amount of $35 million, which is the maximum fine the National Highway Traffic Safety Administration can implement for a single violation. For its part, the Department of Transportation believes that a $35 million fine amounts to a mere “rounding error” for a car company of GM’s size, and that a $300 million fine would be more appropriate. Unfortunately, whatever the size of the fine, the money from the GM settlement goes to the U.S. Treasury, not to compensate car accident victims.

Contact an Experienced GM Recall Lawyer for Help

The decade-long delay of GM’s ignition switch recall has prompted investigations by the NHTSA, the Justice Department and Congressional committees, and has shed light on a culture at General Motors of putting cost concerns ahead of the customer. So far, General Motors has recalled nearly 13 million vehicles, the latest coming on May 16 when the auto maker recalled another 8,560 cars for problems with the brakes. The car company also faces lawsuits filed by car owners pursuing financial compensation related to the reduced value of their GM vehicles. If your General Motors vehicle has decreased in value because of a faulty auto part, or if you have been involved in a car accident involving a recalled GM vehicle, our consumer advocates at the Consumer Justice Foundation can help put you in touch with an experienced GM recall attorney today.

[box type=”note” align=”aligncenter” ]Source: http://money.cnn.com/2014/05/16/news/companies/gm-nhtsa/index.html?hpt=hp_t3[/box]

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