Are Your Cars In Their Parks?
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General Motors (NYSE: GM) has undergone yet another setback. The automaker is likely to recall approximately 474,000, Chevrolet, Pontiac and Saturn sedans around the world to fix a fault in their shift gears. This fault has given rise to a condition that could lead the cars to roll away when the drivers think their cars are safe in the park.
GM said it was aware of around four crashes resulting from the problem but their reportedly have been no injuries due to crashes.
The company reports that the recall has affected the sales of the respective models. The affected cars include Chevy Malibu, Pontiac G6 and Saturn Aura from model years 2007 through 2010 and are equipped with four-speed automatic transmissions. GM says it will repair the condition in which the transmission gear may not match the gear on the shifter by recalling the cars.
The recall in all has affected 426,240 cars in the US, a mind boggling 40,029 cars in Canada and approximately 7572 cars in other markets.
Dealers will have to add reinforcement to the shift cable end fitting to prevent that part from fracturing, GM has promised. Owners will be notified by letter to schedule the free repairs at their respective dealers’ workshops. Those who’ve already had the work done would be eligible for reimbursement.
The company also said it was recalling Chevy Sonic subcompact cars globally because given the fault in them they might not alert the driver to a faulty turn-signal bulb. Dealers will reprogram the incorrectly calibrated module for the cars built between May 29 and August 29 at GM’s Orion, Michigan plant. This new recall affects around 4,716 cars in the US and 1,759 cars in other markets. GM has reported that they haven’t received confirmations of any crashes and injuries stemming from this problem though there are chances of the transmission cables to break.
GM has an IBD composite rating of 32, an EPS rating of 13 and a Relative Strength rating of 68. The shares of GM rose 1.7% to 24.80.
The problem was noticed once GM started gathering data for a US government investigation of a similar problem with transmission cables on the same cars. The government began investigating these cars after getting reports about seven crashes and an injury.
In March 2009, GM recalled 227,000 vehicles for a similar shift lever problem. The models which were recalled were 2009 model year versions of Buick Enclave, Chevrolet Cobalt, HHR, Malibu and Traverse, GMC Acadia, Pontiac G5 and G6, Saturn Aura and Outlook. Only 75,000 of the total vehicles were sold with the rest being kept at the dealerships.
Errors with Ford:
Ford Motor (NYSE: F) is also facing an upheaval. It is also recalling some of its 2012 Edge vehicles because of concerns that fuel lines could leak and cause potential fires.
The recall affects about 5500 vehicles worldwide made between September 2 2010 and October 31 2011. The Edge is a midsized SUV and the affected vehicles have a 2-litre engine. The problem is caused by a part in the fuel-line that could crack. If it did, the smell of the gas would probably be noticeable and fuel leaks might also appear. Those conditions could cause a serious fire. Ford has blamed a faulty manufacturing by a part supplier.
Ford will notify owners by mail with instructions to take their vehicles to a Ford or Lincoln dealer. If the vehicle needs to be fixed, the dealer will do the repairs for free. The recall is set to begin on or about 24th of September.
The auto market is in serious trouble with big players like GM and Ford Motor Co. not playing safe. As it has been, the market in Europe has not been very profitable. Even the American market seems sluggish with Detroit automobile industry in an upheaval. There does not seem to be much scope for investment thus. With almost no feedback from the once flourished markets in America and Europe, the companies are moving eastwards and looking to capitalize on Chinese and other Asian markets. The profits are being sensed but are minute when compared to the good ol’ days. But critics have predicted a speedy recovery. Well, we can just keep our fingers crossed and wait patiently.
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rekhamarwah has no positions in the stocks mentioned above. The Motley Fool owns shares of Ford. Motley Fool newsletter services recommend Ford and General Motors Company. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.