General Motors Ignition Switch Recall Crisis
Market Context & Analysis
Starting Price: $37.00GM recalls 2.6 million vehicles for defective ignition switches linked to 124 deaths. Company knew about problem for decade but didn't fix it. Internal emails show cost-benefit analysis valued fix over lives. CEO Mary Barra apologizes before Congress. Criminal prosecution follows.
Economy recovering post-financial crisis. Auto industry healthy after government bailout and restructuring. Sales growing steadily.
Government bailout of GM still controversial. Congressional hearings examining recall and cover-up. Criminal investigation by DOJ. Victim compensation fund established.
GM emerged from bankruptcy in 2009. Ignition switch defect existed for decade. Internal emails damning—cost over safety. Mary Barra new CEO handling crisis. Eventually pays $900M criminal fine and $600M civil claims.
Auto sector recovering. GM-specific crisis but company post-bankruptcy stronger. Questions about safety culture. Criminal liability concerning but survivable.
- Defect killed 124 people over decade
- Company knew and didn't fix—conscious decision
- Cost-benefit analysis chose profits over safety
- Congressional testimony and hearings
- Criminal prosecution and $900M fine
- Victim compensation fund costly
- Safety culture questioned