General Motors India expect to pay hefty fine over Chevrolet Tavera fiasco

General Motors India expect to pay hefty fine over Chevrolet Tavera  fiasco New Chevrolet Tavera
author image CarTrade Editorial Team
Wednesday 23 October 2013, 12:13 PM

Soon after resuming production of Chevrolet Tavera, things were seemingly looking bright for General Motors India. However, fresh reports have emerged, claiming that the auto maker could be in trouble for its escapades in the past. According to sources, Indian subsidiary of the American car company is going to face a big fine due to the recalling of over a lakh units of Chevrolet Tavera. After this huge fiasco happened, there was a probe panel setup by the government, which looked into the subject matter. A detailed investigation into the matter, reportedly, found activities of General Motors India absolutely unacceptable and breaching rules set up by government authorities. Notably, the firm, earlier in the year, had admitted to violation and fabrication of data related to testing of vehicles, which saw the recalling of around 1.14 lakh units of Chevrolet Tavera.

General Motors India expect to pay hefty fine over Chevrolet Tavera fiasco

Reports suggest that the company could be charged with corporate fraud, something that could have serious monetary implications. Apart from a heft penalty, General Motors India has done some high degree damage to its reputation in the country. Notably, the company had gone ahead itself and written a letter to the government, in which it mentioned the wrongdoings committed. In addition, report given by the panel claims that the fault was only on the part of the Original Equipment Manufacturer (OEM), which automatically means that there was no error from the end of testing laboratories. The biggest howler committed by General Motors India was that it fitted vehicles with already tested engines that had been approved previously.

Although this entire fiasco has been a bad one for General Motors India, it has been handling things pretty well. In fact, the firm took strong actions following its admission by sacking a number of top executives from their posts. And it was not only officials from the Indian subsidiary that faced the axe, General Motors took strict action against some top employees in the global operation unit. According to sources, the governing authority would soon be announcing the punishment after seeking approval from ministries. Industry experts feel that this incident reflects the problems that exist in testing systems and norms in Indian automobile market. Experts feel that authorities should enhance the level of strictness in testing methods, thereby sending out a strong signal to all potential offenders.

In the recent past, incidents of vehicles being recalled have occurred quite frequently in the Indian car market. Analysts say that these developments are not healthy signs for the auto industry in India. It is believed that there is a need for the strengthening of the system, wherein everything is much more transparent than what exists at the moment. Things like violation of emission norms and duplication while testing just show the kind of liberties auto makers think they can take. Last but not the least, these incidents have effects on the quality of cars as well, sometimes proving to be fatal for customers.

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