General Motors Company
) announced that it would recall 44,668 units of Chevrolet Sonic
subcompacts in order to fix their faulty windshield washers. The
vehicles were manufactured between May 5, 2011 and February 24,
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GM revealed there are chances that windshield wiper washer hose
could segregate from the washer fluid reservoir. According to the
National Highway Traffic Safety Administration (NHTSA), a lack of
washer fluid could hinder the driver's view, increasing the risk of
a crash. GM plans to notify the vehicle owners on September 7.
This is GM's fourth recall in the month. Earlier this month, GM had
recalled 38,000 units of Chevrolet Impala police cars in North
America after receiving complaints from two police fleet about
front lower control arms that had fractured. The recall covered
36,413 cars in the U.S. and 1,713 in Canada from the 2008-2012
In the third week, the company also announced that it would recall
10,315 units of full-size vans in 20 cold-weather U.S. states and
in Canada due to fuel filler pipes that can rust and leak due to
salt and chemicals used to clear snow from roads. The recall covers
Chevrolet Express and GMC Savana vans from the model year 2003 to
2004 with left-side cargo doors.
Last week, GM also announced plans to recall 249,260 units of
midsize sport utility vehicles (SUVs) in order to fix a potential
fire hazard led by an electrical short. The recall would cover
Chevrolet Trailblazer and GMC Envoy SUVs as well as Buick Rainier,
Saab 9-7X and Isuzu Ascender SUVs, all from the 2006-2007 model
Automotive safety recalls were brought into focus by media after
) announcement of the largest-ever global recall of 3.8 million
vehicles in September 2009, triggered by a high-speed crash that
killed 4 members of a family.
Later on, a string of recalls has led Toyota to face numerous
personal injury and wrongful death lawsuits in federal courts. The
Transportation Department of U.S. had also imposed a fine of $48.4
million on the company due to late recall of millions of defective
GM, a Zacks #3 Rank (Hold) company, reported a sharp 41% fall in
profits to $1.49 billion or 90 cents per share in the second
quarter of the year from $2.52 billion or $1.54 in the same quarter
of 2011. Nevertheless, profits exceeded the Zacks Consensus
Estimate by 15 cents per share.
Revenues in the quarter fell 4.5% to $37.61 billion, which is lower
than the Zacks Consensus Estimate of $37.98 billion. Unit sales
rose 3% to 2.39 million vehicles from 2.32 million vehicles in the
second quarter of 2011. The automaker occupied a worldwide market
share of 11.6% during the quarter, down from 12.3% a year-ago.
Adjusted earnings before interest and tax (EBIT) dipped 28% to
$2.12 billion from $2.96 billion in the second quarter of 2011.
Operating profit ebbed 26% to $1.82 billion from $2.45 billion a
The decline in profits and revenues was attributable to
strengthening of U.S. dollar against most of the major currencies
as well as weak macroeconomic conditions globally, especially in
Europe and South America.