GM and LG Reach $150 Million Settlement for Chevy Bolt EV/Bolt EUV Owners Affected by Faulty Batteries
May 20, 2024, 3:38 pm
In a significant development, General Motors (GM) and LG have come to an agreement to provide a substantial $150 million compensation fund for owners of Chevy Bolt EV and Bolt EUV electric vehicles who have been grappling with defective battery issues. This settlement stems from a class-action lawsuit filed against GM by owners who alleged that the automaker sold them vehicles with faulty batteries, leading to safety concerns and potential risks of fire incidents.
As part of this legal resolution, owners who took the proactive step of installing special software updates provided by GM to address the battery problem may be eligible to receive compensation of up to $1,400 from the fund. Additionally, individuals who sold their vehicles or leased them before the software update became available could qualify for a payment of $700, according to court documents filed in Michigan.
GM's decision to halt production of the Bolt EV in 2023 marked a strategic shift towards focusing on the development of new electric vehicle models, such as the Equinox EV, built on the advanced Ultium modular platform. The move was driven by the recognition that the Bolt EV, which had been in production for over seven years, had become technologically outdated. The Ultium platform was highlighted as a superior and more cost-effective alternative to the previous BEV II platform, offering a 40% reduction in production costs.
The recall of 68,000 Chevy Bolt EVs in 2020 due to battery defects, which posed a fire risk, was a significant setback for GM, resulting in a substantial expenditure of $1 billion. The technical shortcomings in the battery performance of these electric vehicles had raised concerns among customers, prompting GM to take decisive action to address the issue. The recall process involved a temporary suspension of production and sales of the Bolt EV for over six months, underscoring the seriousness of the situation.
GM's collaboration with LG, a South Korea-based electronics company, in the development of the batteries used in the Bolt EV, dates back to the vehicle's debut in 2015. However, reports of spontaneous fires in some Bolt EVs raised alarm bells among drivers, leading to complaints being lodged with GM and the National Highway Traffic Safety Administration. Subsequent investigations by GM revealed a manufacturing defect in the battery modules, resulting in a short circuit within the battery cell.
The global recall of all Bolt vehicles in 2021 was a pivotal moment for GM, as it underscored the company's commitment to prioritizing customer safety and addressing quality issues promptly. With nearly 25,000 Bolt EVs sold in the U.S. before sales were halted, GM faced both financial and reputational challenges due to the battery-related concerns. The decision to discontinue production of the Bolt EV in December 2023 marked a strategic pivot towards expanding its electric vehicle lineup, which now includes models like the Hummer, Silverado, and Lyriq.
Looking ahead, GM has outlined ambitious plans to transition away from gas-powered vehicles by 2035 and invest $35 billion in the development of over 30 new EV models globally by 2025. The company aims to generate an additional $90 billion in annual revenue from EVs by the end of the decade, signaling a strong commitment to sustainable mobility solutions and technological innovation in the automotive industry.
As part of this legal resolution, owners who took the proactive step of installing special software updates provided by GM to address the battery problem may be eligible to receive compensation of up to $1,400 from the fund. Additionally, individuals who sold their vehicles or leased them before the software update became available could qualify for a payment of $700, according to court documents filed in Michigan.
GM's decision to halt production of the Bolt EV in 2023 marked a strategic shift towards focusing on the development of new electric vehicle models, such as the Equinox EV, built on the advanced Ultium modular platform. The move was driven by the recognition that the Bolt EV, which had been in production for over seven years, had become technologically outdated. The Ultium platform was highlighted as a superior and more cost-effective alternative to the previous BEV II platform, offering a 40% reduction in production costs.
The recall of 68,000 Chevy Bolt EVs in 2020 due to battery defects, which posed a fire risk, was a significant setback for GM, resulting in a substantial expenditure of $1 billion. The technical shortcomings in the battery performance of these electric vehicles had raised concerns among customers, prompting GM to take decisive action to address the issue. The recall process involved a temporary suspension of production and sales of the Bolt EV for over six months, underscoring the seriousness of the situation.
GM's collaboration with LG, a South Korea-based electronics company, in the development of the batteries used in the Bolt EV, dates back to the vehicle's debut in 2015. However, reports of spontaneous fires in some Bolt EVs raised alarm bells among drivers, leading to complaints being lodged with GM and the National Highway Traffic Safety Administration. Subsequent investigations by GM revealed a manufacturing defect in the battery modules, resulting in a short circuit within the battery cell.
The global recall of all Bolt vehicles in 2021 was a pivotal moment for GM, as it underscored the company's commitment to prioritizing customer safety and addressing quality issues promptly. With nearly 25,000 Bolt EVs sold in the U.S. before sales were halted, GM faced both financial and reputational challenges due to the battery-related concerns. The decision to discontinue production of the Bolt EV in December 2023 marked a strategic pivot towards expanding its electric vehicle lineup, which now includes models like the Hummer, Silverado, and Lyriq.
Looking ahead, GM has outlined ambitious plans to transition away from gas-powered vehicles by 2035 and invest $35 billion in the development of over 30 new EV models globally by 2025. The company aims to generate an additional $90 billion in annual revenue from EVs by the end of the decade, signaling a strong commitment to sustainable mobility solutions and technological innovation in the automotive industry.