If there's one good thing about General Motors Co nowadays is that there are now more proactive in spotting potential flaws in their vehicles. Amid a slew of additional recalls issued by the top automaker in the US, industry observers believe that there might be more defects that GM might not expect.
Barclays analyst Brian Johnson, who had met with GM's head of product development Mark Reuss, wrote last week that the company might be recalling more vehicles into the middle of the summer months.
"GM is trying to aggressively issue recalls for items as soon as they learn about it, rather than batching the items for a vehicle and waiting -- even if there may be negative optics around such a strategy," Johnson said.
According to Johnson, Reuss is currently heading a team composed of five executives who will be making recall decisions. The bank analyst also noted that the recall decisions are often made by a lower-level committee of engineers.
The change in responsibility, among other things, have been spurred since GM had issued a recall of over 2 million of its vehicles due to an ignition defect. Bloomberg said since then, the company has been the subject of an investigation by the National Highway Traffic Safety Administration and by national lawmakers on why it took the company over a decade to take action on complaints about the defect. GM has since then issued several recalls of millions more over issues ranging from the cars' shift cables, seat belts and other parts.
Executive market analyst Jack Nerad at auto researcher Kelley Blue Book said, "They let the genie out of the bottle and can't put it back in. They're almost certainly going to be finding more."
According to NHTSA data, the multiple recalls issued by GM so far has already cost around $1.7 billion in charges this year, and had pushed the country's industry total this year to 23 million. The highest combined number of recalled cars was recorded in 2004 at 30.8 million. Bloomberg noted that majority of the 30 recalls issued by the US automaker were prompted by customer complaints.
