Government Motors

Locutus
#1
via sda:

Government Motors


Total recall (external - login to view): "Here's the chart (external - login to view) of GM's stock for the last six months. Did the Treasury Department get lucky with its sales or is the government guilty of insider trading?"

www.smalldeadanimals.com/arch...medium=twitter (external - login to view)




What did the Treasury Dept. Know About GM’s Problems and When did they Know it? (external - login to view)


Here’s (external - login to view) a timeline from NPR of the ignition-switch issue at GM. Check out the fortuitous timing of the Treasury Department’s sale of its remaining stake in the company in December 2013:
June 1, 2009: GM files for Chapter 11 bankruptcy.

July 10, 2009: The U.S. Treasury purchases GM assets, giving the government primary ownership of the company.

February 2010: NHTSA again recommends a probe looking into problems with air bags in Cobalts; ODI again decides that there is no correlation and drops the matter.

Oct. 26, 2010: Consumer Reports says GM is considered “reliable” based on scores from road tests and performance on crash tests.

2012: GM identifies four crashes and four corresponding fatalities (all involving 2004 Saturn Ions) along with six other injuries from four other crashes attributable to the defect.

Sept. 4, 2012: GM reports August 2012 sales were up 10 percent from the previous year, with Chevrolet passenger car sales up 25 percent.

June 2013: A deposition by a Cobalt program engineer says the company made a “business decision not to fix this problem,” raising questions of whether GM consciously decided to launch the Cobalt despite knowing of a defect.

Dec. 9, 2013: Treasury Secretary Jacob Lew announces the government had sold the last of what was previously a 60 percent stake in GM, ending the bailout. The bailout had cost taxpayers $10 billion on a $49.5 billion investment.

End of 2013: GM determines that the faulty ignition switch is to blame for at least 31 crashes and 13 deaths.


And it’s not just the sale of the final piece of equity that looks suspicious. Here’s a timeline from the Treasury Department. Note the activity by the Treasury Department occurring after the NHSTA’s second warning to GM in February 2010, including GM’s IPO:
On April 20, 2010, GM made its final loan repayment, leaving the remaining investment
in the form of common and preferred stock.

On November 18, 2010, Treasury recovered approximately $13.5 billion in conjunction
with the new company’s IPO. The IPO reduced Treasury’s stake from approximately 61
percent to 33 percent, or 500 million shares of GM common stock.
GM going public was necessary for taxpayers to get paid back. Here’s the prospectus. I did a quick search for ”ignition” and received two hits, neither in regard to the switch defect. Cobalt, the model at the center of the problem, is not mentioned at all. And here’s the “Risk Factor” dealing with recalls:
The costs and effect on our reputation of product recalls could materially adversely affect our business.

From time to time, we recall our products to address performance, compliance, or safety-related issues. The costs we incur in connection with these recalls typically include the cost of the part being replaced and labor to remove and replace the defective part. In addition, product recalls can harm our reputation and cause us to lose customers, particularly if those recalls cause consumers to question the safety or reliability of our products. Any costs incurred or lost sales caused by future product recalls could materially adversely affect our business. Conversely, not issuing a recall or not issuing a recall on a timely basis can harm our reputation and cause us to lose customers for the same reasons as expressed above.
Is this statement sufficient to cover GM for the size of the problem that was reportedly known since 2005 and has resulted in the recall of 2.6 million (external - login to view) cars? Would GM ever have gone public if this switch issue and the corresponding deaths were public? I highly doubt it.
Continuing with the timeline from Treasury:
On December 15, 2010, GM repurchased all of the preferred stock Treasury held for
approximately $2.1 billion. Treasury’s remaining investment consisted solely of GM
common stock.

On December 21, 2012, GM repurchased 200 million shares of common stock for
approximately $5.5 billion in net proceeds to taxpayers. At that time, Treasury announced
its intent to exit the GM investment in 12-15 months through a series of pre-defined
trading plans that began in January 2013 and sold shares into the market daily.

On June 6, 2013, Treasury sold 30 million shares of GM common stock when GM was
included on the S&P 500 index for approximately $1.0 billion.

In total, Treasury launched four pre-defined written trading plans, completing the sale of
its shares of GM common stock on December 9, 2013. The proceeds from the four
trading plans totaled $9.2 billion.

Taxpayers have recovered $39 billion on the investment in General Motors, but had we
not acted to support the automotive industry, the cost to the country would have been
substantial — in terms of lost jobs, lost tax revenue, reduced economic production, and
other consequences.
Here’s (external - login to view) the chart of GM’s stock for the last six months. Did the Treasury Department get lucky with it sales or is the government guilty of insider trading? Is GM guilty of securities fraud for not mentioning the switch defect in their IPO prospectus? Did the Treasury Department know about the switch defect and still let GM go public without the proper disclosures?

At the very least, the SEC should start asking questions, treating the Treasury Department as if it were any other investor — there’s more than enough here to merit an investigation.


What did the Treasury Dept. Know About GM's Problems and When did they Know it? | National Review Online (external - login to view)



 
tay
#2
Be interesting to see the size of their fine compared to Toyota's...........






Toyota Is Fined $1.2 Billion for Concealing Safety Defects




MARCH 19, 2014




Eric H. Holder Jr., the United States attorney general, talked in impassioned tones on Wednesday about Toyota’s behavior in hiding safety defects from the public, calling it “shameful” and a “blatant disregard” for the law. A $1.2 billion criminal penalty, the largest ever for a carmaker in the United States, was imposed.


Mr. Holder said the department’s four-year investigation of Toyota found that the company concealed information about defects from consumers and government officials, putting lives at risk because of faulty parts that caused sudden, unintended acceleration in several of its models.


But Toyota wasn’t the only company on everyone’s mind.


General Motors is now the subject of a Justice Department inquiry over its failure to recall cars with a defect that is linked to 12 deaths. And while Mr. Holder did not address questions about the G.M. inquiry, he said the Toyota case would be a model for its newly vigilant approach to automotive safety.


“Other car companies should not repeat Toyota’s mistake,” Mr. Holder said at a news conference in Washington. “A recall may damage a company’s reputation, but deceiving your customers makes that damage far more lasting.”




more


www.nytimes.com/2014/03/20/bu...l-inquiry.html (external - login to view)
 
tay
#3
All seems to be quiet on the GM front this week but Toyota is having more problems but seemed to have learned a lesson after that fine and are doing major recalls................








Toyota Motor Corp. today issued a massive recall of 6.39 million vehicles worldwide for a range of glitches, from faulty airbags and seat rails to defective windshield wipers.


The action covers five separate recalls, affecting about 2.34 million vehicles in North America and 810,000 in Europe.


Toyota said it is unaware of any crashes, injuries or deaths caused by the problems, which span more than a dozen nameplates.


The largest of the five recalls today, which covers spiral cables (external - login to view) in airbags, ranks No. 4 in Toyota’s recall roster.


Toyota’s largest single-part recall came in 2012 when it fixed 7.43 million fire-prone window switches. The No. 2 recall covered 7.12 million floor mat entrapment recalls from 2009-2012, and the third-largest was the 2010 remedy of 4.45 million sticky gas pedals to address unintended acceleration.


The latest recalls were announced simultaneously, even though they are unrelated, because that is how the timing of the investigations unfolded, spokesman Brian Lyons said.


The move comes amid heightened regulatory scrutiny of automakers in the United States following General Motors Co.'s recall of 2.6 million small cars (external - login to view) for faulty ignition switches. The defect has been linked to 13 fatalities. Internal documents show that some GM engineers knew of a defect at least 10 years ago, but the company failed to issue a recall.


U.S. dealers this week are beginning to perform the recall work while GM, regulators, prosecutors and Congress all are investigating why it took GM so long to issue the recall.


Toyota penalty

Toyota's recalls today took place after the company agreed last month to a pay a penalty of $1.2 billion (external - login to view) to the U.S. government for misleading consumers and concealing facts about unintended acceleration in its vehicles.


The rash of acceleration problems, traced to sticky gas pedals and unsecured or incompatible floor mats, triggered more than 9 million recalls -- for various parts and design flaws.


A breakdown of the latest recalls and the units involved:




www.autonews.com/article/2014...llion-vehicles (external - login to view)
 
petros
#4
How much did our Feds know as they too held 30Million controlling shares .
 
tay
#5
German luxury carmaker BMW will recall 156,000 vehicles in the US to check for defective bolts that could lead to engine damage.


BMW said it would check whether bolts in vehicles with six-cylinder engines were prone to loosening or breaking.


The vehicles, which also include the Series 5 and the Z4 sports cars, are from model years 2010 to 2012, the company said.


The company's shares fell 1.47% in Frankfurt.


BMW recalled 232,000 cars in China earlier this month for the same reason.


The recall follows moves by car manufacturers around the world.


Toyota, the world's biggest carmaker, said earlier this week it would recall more than six million vehicles, including 35,124 in the UK, over five separate issues.


Some 3.5 million vehicles are being recalled to replace a spiral cable attached to the driver's side airbag.


US authorities have fined General Motors for failing to respond to requests for information about faulty ignition switches linked to 13 deaths.




BBC News - BMW recalls 156,000 vehicles in US after bolt defect (external - login to view)
 
lone wolf
Free Thinker
#6
I wonder how the Pinto or the Corvair would have fared out in today's auto sector....
 
damngrumpy
No Party Affiliation
#7
The reason they saved GM was not the car company it was the money tied up in the banks
had they done nothing there would have been a depression the like we have never seen.
Japan did the messy banking thing in the early eighties and they still haven't recovered.
Iceland did a good thing they put their former bankers in jail.
I don't know about some of you but I am not keen on living through a major depression for
any length of time. I pass keep the system going after I'm dead do what you want.
 
tay
#8
General Motors engineers were well aware of serious problems with ignition switches in GM small cars, but rejected several opportunities to make fixes, according to dozens of confidential documents released on Friday by a Congressional committee investigating the deadly defect.


Parts supplier Delphi Automotive (external - login to view) also repeatedly tested switches and found they did not meet GM specifications, according to emails and other memos.


Still to be answered is whether top GM executives were aware of the issues early on, as engineers struggled to pinpoint causes and solutions for ignition switches that could be turned off inadvertently with the vehicle in motion, causing the engine to stall and cutting power to steering, brakes and airbags.



The documents show the automaker repeatedly elected not to fix or replace the faulty switches, because there was no acceptable "business (external - login to view) case", an indication the solution was deemed too expensive.


It was determined eventually by GM that the switches didn't have enough torque, the rotational force required to keep them from moving from the "run" position to "accessory" which shut down the engine.


A root cause of the problem was a tiny set of parts, called a detent plunger and spring, that helped keep the ignition key in position while the car was running.


A GM engineer at the automaker's mid-Michigan test track encountered an early problem with the switch while driving a prototype of the 2003 Saturn Ion in July 2001.


An internal GM memo on the incident noted that a "tear down evaluation on the switch revealed two cause of failure. Low contact force and low detent plunger force." The memo said both issues were resolved with newer parts, and the case was closed that November, less than a year before the all-new Ion went into production. One of the engineers who signed off on the fix was Ray DeGiorgio, the designer of the switch.


DeGiorgio was one of two GM engineers placed on paid leave earlier this week as GM continues an internal investigation of the recall. GM did not explain the move and DeGiorgio could not be reached for comment.


Supplier Delphi submitted a batch of Ion switches in December 2001, but informed GM that its tests showed many of the switches did not meet GM's torque specifications, according to GM validation documents. Nevertheless, GM approved the parts for production in May 2002, another document shows. The first Ion rolled off the line in August that year.


GM was already beginning to monitor customer complaints about engines stalling in the Ion in 2003, but noted "technicians are rarely able to duplicate the concern."

In another document, Delphi engineers on June 14, 2005, discussed a request from GM that they perform an analysis on the switch.
"Cobalt is blowing up in their face in regards to turning off with the drivers knee," wrote Delphi engineer John Coniff.

A second GM investigation in June 2005 for stalling engines in the Cobalt resulted in a recommendation to provide an ignition key insert to customers, but no change in the faulty switch because the "business case (was) not supported" to redesign the part.

Another group of GM engineers in September 2005, in an email chain, discussed postponement until fall 2008 of a proposal to implement a new switch on the Cobalt, Ion and companion vehicles, because the change would add $400,000 in retooling cost, plus an additional 90 cents per vehicle.

Lori Queen, the top executive overseeing GM's small car team, challenged the delay, saying, "I'm not sure it's ok to wait." She could not be reached for comment.




Documents show GM's early knowledge of switch defect | Reuters (external - login to view)
 
Highball
#9
When all this is settled there may be some big fines (costs passed on to buyers) and no one will be held accountable either. Noting will truly be handled in an effective manner. The investors nor the managers will ever be held accountable.
 
tay
#10
CAUTION


Driver uses language that may be offensive to people who haven't bought an overpriced car........










wwwyoutubecomwatchv-eXUnZrykDYampfeatureplayerembedded

 
taxslave
No Party Affiliation
#11
Thejoys ofowning forign cars.
 
#juan
No Party Affiliation
#12
Let me see, the government takes over GM, FIAT takes over Chrysler....not sure how Ford is doing.
 
tay
#13
DETROIT (AP) -- Hyundai Motor Co. is recalling 137,500 Tucson SUVs because the air bags aren't correctly mounted to the steering wheel.


The recall involves 2011-2014 model years. The affected vehicles were built between Jan. 3, 2011, and Dec. 23, 2013.


Hyundai says the air bag assembly in the steering wheel may come loose from its mounting. That increases the risk of injury in a crash.


The company discovered the issue through warranty claims. It has no reports of injuries or accidents related to the issue.


Hyundai dealers will repair the air bag assembly for free starting next month. Hyundai will notify owners.




Hyundai recalling 137,500 Tucson SUVs - 毎日新聞 (external - login to view)






- General Motors Co was slapped on Friday with a $35 million U.S. fine for its delayed response to an ignition switch defect in millions of vehicles, as federal regulators accused a long line of company officials of concealing a problem that is linked to at least 13 deaths.


He added that GM's admission that it failed to make a timely report of the ignition defect could increase the company's exposure to civil lawsuits "principally because people could have gotten hurt in the interim when GM wasn't making sufficient and timely reports to NHTSA."


The consumer group Center for Auto Safety called the $35 million fine a "slap on the wrist to a hundred billion dollar corporation." It called on the Justice Department to impose a fine of at least $1 billion on GM.




Friday's announcement on GM came a day after the automaker announced five separate recalls covering nearly 3 million vehicles worldwide because of tail lamp malfunctions and potential faulty brakes.




GM to pay $35 million U.S. fine for delayed response | Reuters (external - login to view)
 
tay
#14
Suzuki is recalling more than 184,000 small cars in the U.S. because the steering columns can catch fire.


The recall covers Forenza models from 2004 through 2008 and Reno models from 2005 through 2008. Both vehicles were made for Suzuki by General Motors.


The Japanese automaker says the headlamp switch or daytime running light modules can overheat, melt and catch fire on the left side of the steering column.


The company will notify owners and fix the problem for free. It hasn't scheduled the repairs yet.


GM on Wednesday recalled 218,000 Chevrolet Aveo subcompact cars for a similar problem as the company continues to review safety issues and issue recalls.


It was GM's 29th recall this year, bringing its total number of recalled in the U.S. to around 13.8 million.


American Suzuki Motor Corp. filed for Chapter 11 bankruptcy protection in November of 2012 and stopped selling automobiles in the U.S.


Documents posted Friday by the National Highway Traffic Safety Administration say that the company will provide a plan for fixing the problem and a schedule for notifying owners and dealers about the repairs.




Suzuki recalls GM-made small cars for fire problem (external - login to view)
 

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