GM to Recall 7.6 Million More Vehicles

The car-maker announces another massive recall due to ignition switch issues.
8:06 | 06/30/14

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Transcript for GM to Recall 7.6 Million More Vehicles
What -- Devin -- New York as Wall Street closes its doors on this Monday June 30 this is story stock. Today a look at General Motors the carmaker announced yet another recall today this one covering at least seven point six million more cars in the US. Judy back to 1997. And again. It's to fix bad ignition switches a safety issue that is -- rocking G -- to its core here with a calculator to add this all up force. So many recalls Jeff MacKey at Yahoo! finance Jeff I -- keep track of how many recalls. -- GM lately this has pretty incredible what are we up to in terms just total numbers here. We are pushing thirty million cars recalled this point at three years' worth of sales. It's this I basically GM is as -- calling every car they've ever made I at this point they're airing. On the side of caution seems in every instance. It's really it's hard to say kind of what the natural reaction would be but at this point again the costs are astronomical one point two billion. For the second quarter just for the recall charges that is before we get into litigation and everything else to be associated with it. 2.5 billion as the tab for the year so -- General Motors but absolutely no one thinks that we've seen the end of this -- it's just incredible almost every Carson into day on Wall Street trading and -- in GM has halted ahead of the announcement -- -- -- -- about that wanted to happen. Well you know that actually is not as unusual was you might think grandmother's big piece of news that's coming out a company will typically called the exchange their representatives are set up just to do that. And and -- -- let the noted that snapped the stock halted and that allows the market to digest the news in a sort of composed manner and in this case I think that General Motors I'm not -- -- they came out -- -- mid days sometimes you'll see a stock halted if there's unusual activity. If there's a bunch of -- -- changing hands ahead of a big announcement it'll be clear that the evening news leaked. This wasn't the case energy under sort of -- -- midday announcement and then -- yet another recall the stock opened up for trading again after that was done. Less than 2% drop you -- about an eighty cent drop. Give or take him from open -- close in terms of her from close rather too when they -- the shares -- not a huge amount of damage done to the stock it came back right away. Investors in these laws are becoming a bit inured to these type -- recall announcements the stock has been basically flat since this entire. Chain of nightmarish event started in February. Well I'm a little surprised by that are investors -- that you I would expect that given the -- take -- -- -- -- one point two billion. From this latest to me that I imagine what -- pretty vacant the company right investor wire investors taking this as they are well. You know they're going to be the maker payroll DeVon -- it's these expenses that's not and ought to -- statements argue or -- -- head up from the money GM's going to be able to fund this will be able to afford it and in an economy that's been strong car sales overall. Not just for the entire not just for GM but for the entire industry have been so strong. That that can hide an awful lot of problems underneath and so with the economy picking up. You know I think that Wall Street is just betting that they're gonna look past this and again there's a lot of the idea. That there's not so much going to be this liability across the board in terms of real damage is happening -- of this are surprised damages happen out of this that GM is airing on the side of caution in every conceivable case. And that's why these recalls just keep coming and that's why you'd expect it. I mean at some point the company's just a blanket recall and say you know bring your car or truck and interest it will meanwhile -- you know GM CEO Mary Barton helped announce this compensation plan that's -- overseen by Ken Feinberg. To help people that have been injured or killed really of these crashes caused by the faulty switches. Tell us about how much that's gonna -- in addition to the recalls but this plan here and in and -- their reputation. Well you know it's it's let's -- those -- are two different things we just talked about the money whatever that cost in terms of what it's gonna pay for the compensation and GM's doing this the right way. Both just in terms of what can be done now I have to live in the not so in terms of reputation only well they're standing up -- owning the problem. They're erring on the side of cautions I keep saying in terms of the recalls and they're gonna pay out compensation of the people impacted by this crash. Now that really is about the most you can expect from corporation Mary -- is said all along we're gonna try to own this problem. You can't get in front of something like this because just the nature of really I think really you get the impression the organization -- on this fact finding mission going to route looking -- the cars and recalling everything that seems even slightly Dicey. And so in terms of the reputation. I don't know we and I think what part of what Wall Street -- -- part of what we're seeing the sales figures were GM is doing is they're holding their own. -- is that customers are kind of left ambivalent on the one side it's horrifying that these -- -- did happen. On the other I can't think of a car company I'm more comfortable with them being cautious in terms of the safety level of my vehicle at this point and General Motors there obviously committed to this. They're not spared any expense is the company's financially viable it was a nice change from 67 years ago. So it they're content just muddling along and and I think Mary -- really under -- as she inherited an awful awful tough -- here. And she's going about it and I'm very forthright manner and and something bad again. You know she's sitting there in the saddle onto the spotlight and she's holding on so that's about the best you can expect from GM -- CEO. That's right she took over the country record company about -- -- January. And as you say it's just kind of part of her strategy to kind of make -- -- again -- -- I get a job at a price for there that we know I I've not from Nancy and she really hasn't run the place -- crisis management now good -- job would be at risk remember this was not. -- brand new thing for a should work the way up through GM. And doesn't get enough credit for having done so this and it's -- -- female CEO General Motors classic old heavy metal Detroit. So -- this was really on her plate by the time she got into the office I don't think anyone holds against her. And I think that given the circumstances she's done an incredible job we're not seeing any that we he's -- Toyota. They have something and it's impossible to compare these things when human tragedies involved but they have the problems at the accelerator sticking. And they will end up getting find just for basically lying and obstructing justice and and being kind of cagey about the way -- -- about sharing information. Mayor Evers joined the exact opposite of that need to be very easy as GM lifer for her to try to protect the monopoly protect the franchise but she's not just -- -- sort of at the mercy on it. And what she's standing for within that organization is you know -- -- if you see a problem say something. We're not just rubber stamp stuff anymore and so if -- -- this I believe she can. Then there is she should have the base sat for a nice tenure as CEO but -- -- -- and it's clearly again on this stuff is gone just yet when your bottom line -- an annual average investors that are holding GM right now GM stock right now it doesn't sound like your ring in the death -- just yet. But that there's no organized claim people who maybe concerned about this yet you know and -- that kids you -- -- you -- where near as an -- you look at stocks react. Under two serves as one holiday be given -- good news and you expect him to go up but the resiliency that General Motors are shown here tells me as ambassador. I'm not sure what they could say that what actually surprise Wall Street to the downside. We're not anywhere near financial liabilities the stock is reformer very impressively and you have the economic tail when working for you. I am not at this stock I I am not -- it's not a stock that I -- but I don't tip -- act any company that can stay flat hasn't equity NG morale. Under control when -- -- thirty million cars in the first six months of the year. They don't die great analysis by Jeff -- Yahoo! finance source -- -- -- Jeff thanks so much for joining us. -- -- -- watching -- -- with us on this Monday stay with for your latest headlines. Our -- into our New York thanks for watching.

This transcript has been automatically generated and may not be 100% accurate.

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