GM Faces New Pressure from Outraged Consumers
Business + Economy

GM Faces New Pressure from Outraged Consumers


As details emerge about how General Motors Co dealt with faulty ignition switches in some of its models, car owners are increasingly angry after learning that the automaker knowingly allowed them to drive defective vehicles.

Saturn Ion owner Nancy Bowman of Washington, Michigan, said she is outraged that GM allowed her to drive a "death trap." She said her car had so many ignition problems she was afraid to resell it to an innocent buyer. She bought the 2004 model car new and still drives it after extensive repairs and multiple run-ins with a Saturn dealer she called dismissive.

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"Five times the car died right out from under me after hitting a bump in the road," she wrote in a 2013 posting on a complaint website,, that says it sends information to the National Highway Traffic Safety Administration (NHTSA). "Every time I brought it in they said it was an isolated incident. Couldn't find the problem, so they acted like I was an idiot."

GM recalled 1.6 million cars last month because a faulty ignition switch could turn off a car's engine, disable its airbags and make steering difficult. The recall involves six models from years ranging from 2003 to 2007. The problem has been linked to 12 deaths, the company says.

Documents released by GM this week revealed that the automaker knew about the ignition problem as early as 2001. Auto safety advocates say GM should have ordered a recall years ago, and GM has apologized as investigations by government agencies, Congress and the company itself have multiplied.

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Angry customers are taking to social media to vent their frustrations. GM's company Facebook "fan page" is scattered with complaints amid enthusiasts' comments and the company's updates on its activities. Comments on one post this week featuring a photo of a proud owner and his "Chevy Family" of three cars included sarcastic references about the recall.

The financial costs of the recall and GM's legal liability are still being calculated. Under terms of its 2009 bankruptcy, the "new" GM is not responsible for any legal claims relating to incidents that took place before July 2009. But GM is facing pressure from some consumer groups that say the arrangement would be unfair to victims and want the automaker to establish a trust fund to pay compensation.

Since the recall, GM has said its customers' safety and satisfaction are top priorities. "We are deeply sorry to our customers and for the circumstances surrounding this recall. We are doing all we can today to take care of our customers and to ensure their peace of mind," GM spokesman Greg Martin said.

GM North America President Alan Batey acknowledged last month that the length of time between the first reports of a possible defect and the recall announcement "shows that the process employed to examine this phenomenon was not as robust as it should have been."

Long Silence 
The company's long silence has outraged those who endured poor service or worse. Megan Phillips, who was the driver of a 2005 Chevrolet Cobalt that crashed in Wisconsin, said that until last month's recall she blamed herself for a 2006 accident in which two teenaged friends were killed when her car left the road and hit a clump of trees. 

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Accident investigators hired by the NHTSA found that the key had moved to the "accessory" rather than the "run" position, turning off the engine and disabling the airbags before impact. None of the girls wore seatbelts.

Phillips, 24, said that the families of her deceased friends blamed her for the crash and would not talk to her. Since the recall, Phillips said, they have begun communicating. "I don't have the answer for them. GM has the answer for them," she said.

Phillips said she does not understand why GM did not order a recall earlier. "I don't understand why they would wait 10 years to say something. And I want to understand it but I never will."

'Really Ridiculous'
As part of the recall, the automaker has offered $500 to owners toward buying or leasing another GM car.

The recall involves 2005-2007 Chevrolet Cobalt and Pontiac G5 compact cars, 2003-2007 Saturn Ion compact cars, 2006-2007 Chevy HHR midsized cars, and 2006-2007 Pontiac Solstice and Saturn Sky sports cars.

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Mike Andrews, an attorney with the Alabama firm Beasley Allen, which is weighing possible recall-related lawsuits, called GM's response "really ridiculous." "They've known about this for years, and their response is $500," Andrews said.

Even after repairs, GM warns customers to use only the key and fob on the key ring. The weight on the key is believed to be one of the causes of the ignition jarring out of the "run" position.

The NHTSA has opened a probe into the timing of the recall, and two congressional committees plan to hold hearings. The FBI and the U.S. attorney in Manhattan are also investigating. GM has said it is fully cooperating. GM Chief Executive Officer Mary Barra, an engineer who took the job in January, has apologized publicly and started an internal investigation. 

Fitch Ratings said in a note on Friday that the recall and federal probe may pose a risk to GM's reputation but are not likely to be a financial burden. Fitch said lawsuits could pose more of a problem for GM.

Attorney Robert Hilliard of the Texas firm Hilliard Munoz Gonzales, who is representing Phillips and other families of victims in the Wisconsin crash, said GM owners now contacting him are angered by "the insidiousness of hiding the defect." "We're developing coalitions and associations to help in this battle," he said.

A proposed class action lawsuit was filed against GM in federal court in Texas on Friday. It claims GM knew about the problem since 2004 but failed to fix it, creating "unreasonably dangerous" conditions for drivers of the affected models.

Dennis Hillstead, a former St. Croix County sheriff who investigated the Phillips accident, said it appears "someone dropped the ball" on alerting the public. "It's a sad commentary, perhaps, on large corporations that fail to take the public's well-being into consideration when making their decisions." 

With additional reporting by Marilyn W. Thompson in Washington and Jessica Dye in New York, both of Reuters.