“New” GM – Sorry America, no help with your defective “Old” GM Cars

We first learned that when the Obama White House organized and implemented its special restructuring plan for GM and Chrysler, it failed to set aside money to pay wrongful death and injury lawsuits, leaving hundreds of Americans without recompense for suffering and injuries obtained because of defects in GM and Chrysler automobiles.

Now, it seems that “New GM” has no interest in recalling or repairing defects in vehicles manufactured and sold by “Old GM”:

General Motors Co. is seeking to dismiss a lawsuit over a suspension problem on more than 400,000 Chevrolet Impalas from the 2007 and 2008 model years, saying it should not be responsible for repairs because the flaw predated its bankruptcy.

The lawsuit, filed on June 29 by Donna Trusky of Blakely, Pennsylvania, contended that her Impala suffered from faulty rear spindle rods, causing her rear tires to wear out after just 6,000 miles.

Seeking class-action status and alleging breach of warranty, the lawsuit demands that GM fix the rods, saying that it had done so on Impala police vehicles.

But in a recent filing with the U.S. District Court in Detroit, GM noted that the cars were made by its predecessor General Motors Corp, now called Motors Liquidation Co or “Old GM,” before its 2009 bankruptcy and federal bailout.

The current company, called “New GM,” said it did not assume responsibility under the reorganization to fix the Impala problem, but only to make repairs “subject to conditions and limitations” in express written warranties. In essence, the automaker said, Trusky sued the wrong entity.

“New GM’s warranty obligations for vehicles sold by Old GM are limited to the express terms and conditions in the Old GM written warranties on a going-forward basis,” wrote Benjamin Jeffers, a lawyer for GM. “New GM did not assume responsibility for Old GM’s design choices, conduct, or alleged breaches of liability under the warranty.” (emphasis added)

So let’s see … “New” GM assumes all of “Old” GM’s assets, takes credit for “Old” GM’s legacy, employs most of “Old” GM’s employees, and honors all of “Old” GM’s union contracts.  But it declines to take responsibility for any of “Old” GM’s design or manufacturing problems.  My, how convenient.

And for those of you who would be quick to point out that such a scenario is rather common after corporate bankruptcy reorganization, please remember that this was not a typical bankruptcy.  The restructuring of GM’s debts and creditor obligations was specifically engineered by President Obama’s “Car Czar” Steve Rattner and his White House team, under the supervision of the Executive branch of the Federal government.

Once again, ordinary Americans were given the shaft so the UAW could benefit financially from the restructuring of GM.

Cronyism Runs Deep, in the Obama White House.

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Posted by on August 20, 2011.
Filed under Auto Bailouts, Barack Obama, Big government, Unions.
Tagged with: .


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  • jim_m

    Typical obama:  Any problems are not his responsibility.

    GM has a new gearbox going into all its new cars.  It’s called the obama transmission – It shifts the blame.

    • http://pulse.yahoo.com/_UG44B3BSUSA2IKDMLCB2AMJ4OM Porkulus Chopius

      Shifts blame. Very good : ))

      I for one will never buy another GM auto ever. As a buy American guy all my life I now will buy Jap cars such as my new Mazda MX5.

      • Anonymous

        What about Ford?  What have they done to offend you?

        Bad PR move by GM when they should be trying to rebuild confidence.

        It’s important to maintain a heavy manufacturing industrial base in the USA – Google and Goldman Sachs are not going to build those tanks when the Chinese invade Alaska.

        • Anonymous

          What this tells you is how desperate GM is financially despite the bailout AND that now that the UNIONS own it, how they want to run it.

        • Jeff Blogworthy

          “It’s important to maintain a heavy manufacturing industrial base in the USA.”

          It’s important to begin deregulation and encourage real free-market competition vital to maintaining a heavy manufacturing industrial base in the USA.

          Fixed. Let us put the blame where it lies. A fleeing manufacturing base just doesn’t happen. It was caused. U.S. manufacturers were strong-armed out of existence.

          • Anonymous

            Deregulation got us where we’re at now, at least if you’re talking about trade regulation.

            When you open your borders to imports, and the exporting countries keep theirs closed through regulation, tariffs, and other means, you’re playing a sucker’s game.

      • jim_m

        Good luck with that.  Ford owns Mazda.  At least Ford didn’t take any bailout money.  Ford is the only American company that I would consider buying a car from for the foreseeable future.

        But for my part I will continue to buy VW’s.  That way I get the satisfaction of pissing off GreenPeace and the warmists.

  • Anonymous

    Ah, but Michael, there is a “warranty”!

    “Let me say this as plainly as I can. If you buy a car from Chrysler or
    General Motors, you will be able to get your car serviced and repaired
    just like always,” Obama said in a speech. “Your warranty will be safe.
    In fact, it will be safer than it has ever been. Because starting today,
    the United States will stand behind your warranty.”

    Barack Obama, President of Government Motors
    http://www.autoweek.com/article/20090330/CARNEWS/903309977#ixzz1Vd5dyDZFOR did this statement also have an expiration date, expressed or implied?

    • Anonymous

      “Your warranty will be safe. In fact, it will be safer than it has ever been. Because starting today,
      the United States will stand behind your warranty.”

      Anyone who put any faith in that statement must have ignored all the people that had already been thrown under Obama’s bus.

    • http://www.facebook.com/michael.laprarie Michael Laprarie

      Ha! I’d forgotten about that.  Would love to see this lady sue the White House over her defective “Government Motors” car.

  • Anonymous

    Why would Barry be accountable for this any more then the economy? He inherited it all, including GM’s obligations from one George W Bush!!  

    The scape-goater  in chief… leading from the rear!!

  • Mr Kimber

    Why would anybody want to buy a GM car anyway? This just adds to the reasons not to have anything to do with GM and it’s unions.

  • Jeff Blogworthy

    It seems that good-old corporate greed wasn’t that bad. It’s government greed that one must watch out for. This type of conduct actually gets punished in a free market. Centrally managed markets are unaccountable markets. The less GMs we buy, the more they will be rewarded with government subsidies, i.e. money stolen from the people. You will pay, whether voluntarily or involuntarily.

  • http://profiles.yahoo.com/u/EU5DQWQTTHTPO4A4ZYSL3AAV2U Adjoran

    It wasn’t just the warranty holders who were screwed to favor the unions.  Bondholders, stockholders, non-union pensioners, and those awarded damages from lawsuits against “old GM” were all raped to give the money to the unions.

    I look for the union label everywhere.  If I find one, I buy something else.  If a product is made only by union labor, I can do without it.

  • http://profiles.google.com/elilla.shadowheart Elilla Shadowheart

    The “new” GM didn’t take on all the old contracts, or even honor them.  All union contracts were renegotiated, all of them.

    • Anonymous

      Well that’s nice since the union owns 55% of GM so they were negotiating with themselves how do you suppose that turned out?

      • http://profiles.google.com/elilla.shadowheart Elilla Shadowheart

        That’s nice since it’s around 30%, but hey who wants to make bullshit and reality the same thing?  Besides, nothing stops anyone from buying stock in a company.  In fact my old man got this lovely letter from GM canada stating he could buy shares in the relaunched GM.  I told him if he was going to wait a year for the level to settle out instead of buying in high.

        • Anonymous

          Oh it’s only 30% is that supposed to be better?

          • http://profiles.google.com/elilla.shadowheart Elilla Shadowheart

            Why isn’t it?  Some law saying people, organizations, or companies aren’t allowed to own stock in another?  What’s with this anti-captialism on the right these days?

        • Anonymous

          Oh it’s only 30% is that supposed to be better?

      • http://profiles.google.com/elilla.shadowheart Elilla Shadowheart

        That’s nice since it’s around 30%, but hey who wants to make bullshit and reality the same thing?  Besides, nothing stops anyone from buying stock in a company.  In fact my old man got this lovely letter from GM canada stating he could buy shares in the relaunched GM.  I told him if he was going to wait a year for the level to settle out instead of buying in high.

  • Anonymous

    The politicizing of GM.  What did you expect?  

  • Anonymous

    Obumbler: Those are Bush’s cars, not my responsibility to fix them.

  • Anonymous

    Poor Obama, with all of his other problems, turns out he inherited all of those crappy GM cars too.

    Who could have seen that coming?

  • http://pulse.yahoo.com/_RVIS42ZJEXB6TWZQHYCZF247II Willis Forster

    Very many of those GM car owners are UAW members but they were compensated by getting a piece of the company, keeping their jobs, and health care. Salaried workers lost their jobs , health care, most of the value in their 401k and the warranty on their GM car plus now the economy is wrecked and they can not get jobs that do not exist thanks to obama.

  • http://pulse.yahoo.com/_G7YIUZMXOD5JGZZTCYMVA75KFU Shadow

    If it’s not overturned, and Obamacare fails, will they tell you “your warranty has expired” or simply say “too bad, so sad.”

  • Anonymous

    The thing that bothers me is that some of the people tripping over
    themselves to bitch about GM acting like a company that went through
    bankruptcy are the ones that wanted GM to go through bankruptcy and were
    pissed that GM asked for something other than bankruptcy.

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