GM to Recall Chevrolet Cruze for Faulty Airbags - Analyst Blog

General Motors Co. GM announced that it plans to recall around 33,000 Chevrolet Cruze sedans due to faulty airbags produced by the Japanese supplier Takata Corp. The automaker recalled the 2013 and 2014 models of Cruze as the airbag on the driver's side may fail to inflate in case of any crash. The automaker suspects that this defect is due to the use of a wrong part.

General Motors will be registering the recall with the National Highway Traffic Safety Administration. The automaker is trying to identify all affected cars and find other details related to the defect. However, there is no report of any casualty yet.

Previously, General Motors had recalled 21,000 Cruze sedans of the model year 2012, featuring Takata air bags which were unable to deploy due to electrical problems. As the same problem is leading to the current recall, the automaker has advised its dealers to stop the sale of new and used Cruze vehicles. Most of these recalled vehicles are now with customers.

Chevrolet Cruze is one of the best selling vehicles of General Motors in North America. It is produced in the Lordstown, OH plant. General Motors has produced about half a million Cruze of model years 2013–2014 since Oct 2012. Takata air bags were introduced in the vehicles of model year 2013.

This year till date, GM has issued 44 recalls covering about 20 million vehicles in North America.

Faulty Takata air bags, causing diverse problems, have compelled many automakers including Honda Motor Co., Ltd. HMC, Toyota Motor Corporation TM Nissan Motor Co. Ltd. NSANY and BMW to issue recalls. The faulty Takata-made airbag inflators installed in the vehicles of these automakers can explode and shoot metal shrapnel at the driver and passengers, thus injuring them.

All these automakers had recalled 3.6 million vehicles equipped with Takata airbags for the same problem last year as well. According to Reuters, total recalls related to Takata airbags have amounted to nearly 10.5 million vehicles over a span of 5 years.

Recently, Toyota had announced the recall of nearly 2.27 million vehicles to fix the problem related to Takata airbags. Honda has also recalled 2.03 million vehicles globally, of which 1.02 million are in North America and nearly 669,000 are in Japan. The recalled vehicles include Civic, CR-V, Odyssey and Element manufactured between 2000 and 2005. Nissan has recalled 755,000 vehicles across the globe, of which nearly 250,000 are in North America.

General Motors currently holds a Zacks Rank #4 (Sell).