GM stops selling some Cruze small cars, offering no reason

DETROIT Fri Mar 28, 2014 1:06pm EDT

Cristi Landy, Chevrolet marketing director for small cars speaks during the debut of the 2014 Chevy Cruze Clean Turbo Diesel at the Chicago Auto Show, in this file photo from February 7, 2013. REUTERS/John Gress/Files

Cristi Landy, Chevrolet marketing director for small cars speaks during the debut of the 2014 Chevy Cruze Clean Turbo Diesel at the Chicago Auto Show, in this file photo from February 7, 2013.

Credit: Reuters/John Gress/Files

DETROIT (Reuters) - General Motors Co (GM.N) said on Friday it had told its dealers to stop selling certain Chevrolet Cruze small cars without saying why, in another blow to a company already facing a crisis over defective ignition switches linked to at least 12 deaths.

The automaker said the affected Cruze cars, 2013 and 2014 models equipped with a 1.4-liter turbo engine, are not being recalled. The action only covers the affected models that are unsold on dealer lots, which make up about one-third of the vehicle's inventory at dealers, a GM spokesman said.

The 1.4-liter gas turbo engine accounts for about 60 percent of the Cruze's retail sales mix in any given month, a GM spokesman said. The vehicle also is sold with a 1.8-liter gas engine and a 2-liter diesel engine.

"With GM still in the midst of trying to resolve the recall related to faulty ignition switches on the Chevrolet Cobalt and other legacy models. The last thing they need is a major issue with one of their current high volume production models, in this case, the Chevrolet Cruze," said Kelley Blue Book senior analyst Alec Gutierrez.

Last year, Cruze sales rose 4.4 percent to 248,224 vehicles, making it the 12th strongest selling vehicle in the U.S. market, according to Autodata. Through February, Cruze sales this year were up 19 percent.

"I can just confirm that we put a stop-sale in last night," GM spokesman Alan Adler said.

He said he did not have any details on why the action was being taken, but said stop-sale orders can happen for various reasons. He said stop-sale orders mean the dealers need to do something to the vehicle before it can be sold.

Last month, GM recalled 1.6 million older-model cars globally to replace defective ignition switches that can be knocked out of the "run" position while driving, turning off the engine and disabling airbags and electrical components.

GM Chief Executive Mary Barra is scheduled next week to testify before the House of Representatives and Senate, whose members seek to learn how the problem did not result in a recall earlier despite being first noted within the company in 2001.

One Chevrolet dealer, who asked not to be identified, confirmed the alert to stop selling the 1.4 liter turbo models but said no further details had been provided by GM.

GM shares were up 44 cents, or 1.3 percent, at $34.95 in midday trading on the New York Stock Exchange.

(Reporting by Ben Klayman in Detroit; Editing by Alden Bentley and Andrea Ricci)

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Comments (7)
SilentBoy741 wrote:
Engineers discovered that the Cruze is so small that a heavy key ring could cause a weight distribution imbalance, causing the vehicle to tip over in a low-speed turn.

Mar 28, 2014 11:09am EDT  --  Report as abuse
westernshame wrote:
not divulging the defect and informing the public who have already purchased these cars will only lead to greater liability and larger lawsuits.

Mar 28, 2014 1:18pm EDT  --  Report as abuse
brotherkenny4 wrote:
When you live in a world of government favoritism and media manipulation, you lose the ability to make rational and practical decisions. GM is only slightly emblamatic of this. They aren’t even the worst, they are seemingly only contentious as the facist GOPers have wanted to destroy Obama and what they say they precieve as his socialism. Which of course isn’t even true, since he is in fact another corporatist like them. Nevertheless, sacrificing two good followers in GM and Obama is well worth the good it will do for the facist cause.

The silly idea that this will hurt GM with the consumer is laughable. The “consumer” is a brainwashed idiot who will buy exactly what they are told and think they are being original and new. This will hurt GM with shareholders, and that’s what matters. They will have to pay for another recall, and that will cost shareholders dividends.

Mar 28, 2014 1:41pm EDT  --  Report as abuse
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