GM Halts Deliveries on Some Chevrolet Cruze Models
Another apparent set-back for General Motors (NYSE: GM).
The automaker on Thursday issued a stop-delivery order to Chevrolet dealers in the U.S. for several models of its popular Chevy Cruze compact sedan.
According to a memo obtained by the Automotive News, the order refers to some Cruze models equipped with a 1.4-liter turbo engine – but it doesn't give a reason for the action, saying only that “instructions for releasing the involved vehicles from this stop delivery will be provided in the near future.”
The Cruze, according to Automotive News, is the best-selling GM car in the U.S. – with more than 248,000 units sold last year.
This news comes as GM is still struggling with the fallout from its ongoing recall of over 1.5 million small car models, due to faulty ignition switches. The company says ignition switch issues “may have caused or contributed to the non-deployment of frontal airbags,” in 31 crashes and 13 front-seat fatalities.
Those recalls were announced after GM's new CEO, Mary Barra, announced a wide-spectrum internal safety review. The company also created a new position of Vice President, Global Vehicle Safety.
While information regarding the Cruze stop-delivery order is still scarce, industry observers believe General Motors is attempting to be proactive, when it comes to the reputation of one of its best-selling vehicles.
“This could be an example of how the ‘new’ GM will handle potential safety issues moving forward,” Alec Gutierrez, a senior analyst at Kelley Blue Book, told Benzinga.
“Rather than sweep this one under the rug until the ignition switch news stories subside, they have decided to tackle the issue head-on to ensure potentially unsafe vehicles don’t end up in the driveways of unsuspecting consumers,” he added.
Gutierrez also notes the stop-sale order could end up affecting GM's sales performance for April, if the issue isn't resolved quickly -- “although it is far too early to gauge the total scope of the impact until additional details are known.”
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