General Motors Company
) 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 years.
GENERAL MOTORS (GM): Free Stock Analysis Report
TOYOTA MOTOR CP (TM): Free Stock Analysis
To read this article on Zacks.com click here.
The vehicles are either sold or currently registered, particularly
in the Northeast and Midwest states, including Connecticut,
Delaware, Illinois, Indiana, Iowa, Maine, Maryland, Massachusetts,
Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York,
Ohio, Pennsylvania, Rhode Island, Vermont, West Virginia, Wisconsin
and the District of Columbia.
In a filing with National Highway Traffic Safety Administration
(NHTSA), GM revealed that a possible electrical short could affect
power windows and door locks and lead to fire in severe cases.
The automaker has decided to replace the driver's master power
window switch on Chevrolet, GMC and Buick models. It has asked Saab
and Isuzu owners to call customer service centers or the NHTSA
safety hotline for information regarding the repair.
This is GM's third recall beginning this month. Earlier this
month, GM announced its plan to recall 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, which is expected to begin today, covers 36,413 cars in
the U.S. and 1,713 in Canada from the 2008-2012 model years.
Last 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.
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. 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.