General Motors Company’s (GM - Analyst Report) Australian subsidiary, GM Holden, announced the recall of about 46,000 Commodore and Caprice cars of model year 2014. Of the vehicles recalled, 41,933 vehicles are in Australia and 3,744 are in New Zealand.
GM Holden is recalling the vehicles as it was discovered that the pretensioner wiring harness, which tightens the seat belt, may be wearing off due to friction with a bolt on the seatbelt buckle. As a result, the automatic seatbelt tightening mechanism may fail in case of a crash. General Motors said that it was not aware of any injury related to the problem, which was discovered during routine tests.
Last year, General Motors announced its decision to stop vehicle and engine production and cut down engineering operations in Australia by 2017 end. The automaker plans to transform into a national sales company in Australia and New Zealand.
General Motors is trying to resolve outstanding safety issues quickly. Last week, the automaker announced four separate recalls, amounting to 2.42 million vehicles, in a single day in the U.S. Additionally, the company recalled 284,913 Chevrolet Aveo and Optra vehicles of model years 2004 to 2008 globally.
General Motors has announced 31 recalls so far this year. The automaker estimates that it will incur a charge of about $400 million in the second quarter for repairing all the vehicles recalled during this quarter. The company had recorded a $1.3 billion charge for recall-related repairs in the first quarter.
General Motors currently carries a Zacks Rank #3 (Hold). Some better-ranked automobile companies worth considering are Fox Factory Holding Corp (FOXF - Snapshot Report), Tata Motors Limited (TTM - Snapshot Report) and Fuji Heavy Industries Ltd. (FUJHY - Snapshot Report). Fox Factory and Tata Motors carry a Zacks Rank #1 (Strong Buy), while Fuji is a Zacks Rank #2 (Buy) stock.