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There Are Still Unanswered Questions In The GM Recall Crisis

May 12, 2014
Colson Hicks Eidson

According to, General Motors (GM) managed to weather its first quarter recall crisis by posting a slim profit on April 24. The company earned $125 million, despite $1.3 billion in expenses to pay for recalling nearly 2.6 million vehicles worldwide.

The results were an 86 percent decline from its year-ago performance, but avoided GM’s first quarterly loss since 2009. GM’s CEO Mary Barra held her first investor conference call since Congressional hearings were held about the GM recall crisis, and her second since becoming CEO on January 5. Barra spent a good deal of time during the conference discussing GM’s response to the recall crisis. However, there are still unanswered questions surrounding the GM recall situation, such as:

1. Will GM offer compensation to victims?

GM has retained legal counsel to try to keep from paying  restitution. If you are a victim of one of their defective models, consult with an experienced attorney so you can get the compensation you deserve.

2. When will the cars’ defects be repaired?

The company says most will be fixed by the fall. GM began shipping replacement parts to dealers earlier this month and is working with its supplier, Delphi, to increase production of new ignition parts.

3. Will GM’s recall expense go up?

This is a possibility. GM’s initial estimate of a $300 million recall expense has been revised twice, and is now $1 billion higher than when the recall crisis began.

4. Would GM actually use this tragedy as a sales opportunity?

It looks like they already have. Analysts say that with owners streaming into GM showrooms to have cars fixed, GM dealers have used it as a chance to sell those people a new car.

Did You Know: So far, ignition defects on GM’s Pontiac, Saturn and Chevrolet small cars have resulted in 13 deaths and 31 crashes.

Colson Hicks Eidson – Injury Attorneys