GM's $1.3B recall cost wipes out profit

Consider this as proof that ignoring a problem doesn’t make it go away. It often makes the problem worse.

CNNMoney reports that General Motors’ recall of more than 7 million vehicles has wiped out the automaker’s first-quarter profit. The recall of 2.6 million cars is the result of a faulty ignition switch linked to at least 13 deaths. GM reportedly knew about the defective switches for more than a decade, but did nothing to fix the problem.

The repair costs for the ignition switches and other recalls total more than $13 million and have been charged against the first quarter, accounting for the loss of profit, CNNMoney reports.

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