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  • Quality crisis at GM: The worst year for recalls since 2004

    International Business Times - 05/21/2014

    General Motors Co.’s (NYSE:GM) problems have gotten so bad that this year it has recalled more vehicles than it’s sold since the company’s 2009 bankruptcy, raising questions about whether the century-old carmaker has made any progress under U.S. taxpayer support.

    The last time GM had a recall even close to this year’s 13.7 million vehicle debacle came a decade ago when it ordered 10.7 million autos back to dealerships for fixes, including faulty Chevy Trailblazer tail lights and sticky Pontiac Grand Am accelerators.

    The 30 recent safety recalls, including the one announced Wednesday for 218,000 older model Chevrolets due to a potential fire hazard, puts into question how effective $11.2 billion of public rescue funds have been in getting GM to improve quality. The answer may be the publicly funded rescue had nothing to do with autos at all.

    “GM has become a client state of the U.S. government,” Joseph M. Giglio, professor of strategic management at Northeastern University’s D’Amore-McKim School of Business, said. “For years it’s been a job bank that happens to make cars.”

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