Image courtesy CBSNews.com
Ah, GM. We loved them for their choo-choo train engines and we loved them for those old muscle cars like the GTO and the Smokey and the Bandit Trans Am. But while good old Detroit iron is always near and dear to any real gearhead's heart, it's hard to love GM itself.
You see, GM is being schmucky again.
We all know the story of Government Motors, the company that was too big to fail, so we bailed them out. We bailed them out to the tune of billions of taxpayer dollars and we (the U.S. taxpayers) still own something like 27% of the company.
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So, here's what the fine folks at GM are doing. Back in 2007 and 2008, General Motors Corporation (the "old," pre-bankruptcy GM) made some bad Impalas. There were some serious problems with some 400,000 Impala suspensions.
A class action lawsuit was brought against the company demanding the company honor its warranty and fix the suspensions.
To this, the so-called "new" GM responded that they're not responsible for fixing the suspensions because those cars were sold by the "old" GM and the "new" GM is a different company. So, claims the company, it's not responsible for warranties sold with cars before it became "new" GM.
Now, as it turns out, the new GM is, technically, a separate company. But since they're trading on the same brand equity as the old GM, they're using the same plants, the same products, technology, and designs, the same engineering assets, and even the same production lines, we can be pretty sure the new GM is essentially the same company as the old GM -- except powered by taxpayer money.
So this is, apparently, how GM repays Americans. Instead of honoring warranty repairs, they throw up a legal smokescreen and try to slither away from fixing the cars they built and sold to the very same taxpayers they previously went begging to for help.
Now, as it turns out, President Obama even came out and promised that warranties, specifically from GM, were "safer than they have ever been".
So, here's the interesting question. If GM -- the new, extra schmucky GM we all own a piece of -- won't honor its warranties, does that mean the U.S. government is somehow going to have to pick up the tab? And does that mean that, once again, the American taxpayer is going to have to be footing the bill because GM's new set of senior executives are just as much gasholes as the executives of the old GM?
Oh, just in case you're curious, Daniel Akerson, GM's CEO, is expecting to take home a pay package somewhere in the range of $9 million this year.
Since we own about 27% of the company, we Americans are paying him about $3 million this year to screw other Americans out of their warranty service.
Kind of makes you proud to be a car guy, doesn't it?