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GM halts most Chevy Cruze sales

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NEW YORK -- General Motors has halted the sale of most of the Chevrolet Cruzes now on dealer lots. The Cruze is GM's best selling car model in the United States, and is also widely distributed internationally.

Spokesman Alan Adler confirmed that the automaker has ordered a halt to sales of models with the 1.4-liter turbo engine, the most popular version of the compact car. Adler did not know the reason for the halt, and said there has not been a recall issued on cars already sold.

The news comes as GM contends with a damaging recall of 1.6 million small cars worldwide due to an ignition switch flaw that has been linked to at least 12 deaths. This stop order is minor in comparison to that recall, but comes at a bad time, as Congress and federal prosecutors probe why GM did not recall the cars for a decade after it discovered the problem. GM CEO Mary Barra, who has apologized repeatedly for the delays in the recall, is due to testify before Congress on Tuesday and Wednesday next week.

But today's move could turn out to be a positivefor GM if it shows that the company is responding more quickly to safety issues than it did in the past.

"GM has to do more than appear to be making changes. They have to have verifiable shifts in how they handle safety issues," said Karl Brauer, senior analyst for sales tracker Kelley Blue Book. "What's the big problem with the ignition switch -- that they didn't act quickly enough. Now they're responding at the first signs of any problem."

GM recalled about 300,000 of the Cruze in the U.S. in August of last year to fix a problem with its break assist system.

The Cruze is one of GM's best selling models worldwide, with more than 2 million sold globally since it went on sale in 2009. GM sold 248,000 in the United States last year. Adler said the stop sales order is only for U.S. dealerships.

GM had about a 70 day-inventory of Cruzes at the end of February. That comes to about 7,000 cars nationwide. But some of those 7,000 cars have a larger engine and are therefore not included in the sales halt.

Adler said stop orders are not uncommon and can be for something as minor as a flaw in the window sticker, or as major as a problem that leads to a recall. But not all stop orders lead to recalls. What is unusual, according to Brauer, is for GM to issue a sales halt without giving a reason.

Also on Friday, GM recalled just under 700 Cadillac ELRs, the plug-in hybrid that is the luxury brand's version of the Chevy Volt. Only 55 of the cars have been sold to customers, Adler said, while the rest are on dealer lots.

The recalled ELR's have a calibration problem with their electronic stability control. Adler said the fix is a 20-minute software update.

Shares of GM were higher in mid-morning trading, though the news briefly sent the stock down from earlier highs.

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  • Fast45

    Gee … I’m feeling so glad that Obama used our money to bail out GM and Chrysler. We are so much better off, since they can continue to produce cars that most Americans do not want to buy. Yes, we are. Of course we are.

  • coloradocommish

    I guess it’s true…. CNN IS economically ignorant…
    Could it be that the Forces of demand and supply, representing the aggregate influence of self-interested buyers and sellers on price, and quality of the goods and services offered, in a FREE market, have had some influence on the decision?

    • whlanteigne

      The forces of supply and demand only work in a free market. Multinationals invest a huge amount of money into our political system to make sure the rules are written so that they can evade risk and avoid markets. Let me explain that in small words so that even the Tea Party mentality can keep up: The richest 1% write the rules for their benefit, not yours.

      • Snarky Cosmos

        And the liberal elitists write the rules to benefit them and control the 99% not in their rarified class of supposed enlightenment.

        Both parties are just the two faces of the same dirty coin found in the gutter.

  • Snarky Cosmos

    Now that the Gummint is all indignant over GM’s crappy cars killing people; I’d like to know if the Gummint knew about this problem and suddenly decided to sell its GM stock for a ~$10-billion loss before the switch problem became public.

    • whlanteigne

      Certainly they did. GWB had a hand in it from the beginning, and he enlisted all his other Illuminati associates helping all along- that’s why they convinced McCain to choose Palin, a non-Illuminati, as his running mate, so he would lose.

      Romney, on the other hand, lost on his own.

      • Snarky Cosmos

        And it was Oscama that dumped the stock for a loss with the only explanation being it was time to get out of the car business. So much for the transparency his opaque administration claims to practice.

        By the way; what does McSame-Palin, and Romney have to do with this discussion?

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