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Complexity of New Cars Results in More Recalls

March 6, 2014

According to a new study by Stout Risius Ross, Inc., a global financial advisory firm, complex technology has resulted to more automobile recalls, specifically those that are safety-related. The study was based on the recall data of automakers and the National Highway Traffic Safety Administration (NHTSA).

Complexity of new car technology is the main factor considered in the spiking up of recalls, but it is not the only one. The launch of new models and the introduction of redesigned ones, as well as increased regulatory scrutiny, also contribute to increased recalls.

In 2013, over 10 million vehicles were recalled due to safety issues. This is the highest number of recalled automobiles since 2009. Neil Steinkamp, managing director at Stout Risius Ross, stated in an interview that quality issues are bound to increase as more new vehicles are released on the market. Ford and General Motors (GM) are both launching brand new and revamped autos this year; the two automakers together will be bringing in 30 more vehicles to North America in 2014.

As per the study, recalls are most likely to happen in the automobile’s first year of production. It was found that automakers typically order recalls on 54 percent of their models on the model’s first production year. Hyundai had the most number of recalls in the first year with 67 percent. Toyota has the least number with 42 percent.

This report coincides with the NHTSA investigation regarding GM’s recall of 1.6 million cars due to a defective ignition switch. Regulators are looking into the reason behind the automaker’s very late response to the problem about the said component. It took GM years after they became aware of the problem to recall the affected models. The recall began on February 13th with 619,000 affected cars.

The affected models are the 2005-2007 Chevrolet Cobalt, 2003-2007 Saturn Ion, 2006-2007 Chevrolet HHR, 2006-2007 Pontiac Solstice, 2007 Pontiac G5 and 2007 Saturn Sky.

According to GM, the key rings were the main problem. Because these were either heavy or jarring, they caused the ignition to be removed from the run position. As a result, the engine shuts off and the crash-sensing algorithm disables the air bags. 13 driver and passenger deaths from 2005 to 2009 has been linked to the ignition switch issue.

On March 5th, the NHTSA sent a 27-page letter to GM asking for information and documents linked to the investigation. It requires the automaker to respond to 107 inquiries about the recall.

GM Chief Executive Mary Barra guaranteed that there will be an “unvarnished” review of the possibility that the company postponed a recall of the malfunctioning part. She sent an email to employees of GM saying that she will be leading a team of senior executives that will be monitoring the recall and investigation. Barra also assured that federal regulators will receive “comprehensive information on the issue.”

GM has hired an outside law firm to conduct the review. Attorneys started questioning employees yesterday, aiming to find out how the company dealt with the problem the first time they learned about it in 2004.

Photo credit: Nick Trippe/ Flickr/ CC BY-ND

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