General Motors victims fund announcement was overshadowed by a new wave of recalls bringing the total number up to 29 million this year. Bobbi Rebell reports.
PLEASE NOTE: UPDATED TO REFLECT THE CORRECT NUMBER OF VEHICLES IN THE LATEST RECALL. Another wave of massive recalls for General Motors- just hours after it unveiled its victim compensation fund tied to the ignition switch coverup. Six new recalls- for a total of 8.23 million vehicles from the model years 1997-2014. GM will take a charge of $1.2 billion in the second quarter. The stock was halted on the New York Stock Exchange- and was down about one percent when it reopened Earlier, General Motors unveiled the terms for its victim compensation fund- which is limited to a different defect- the faulty ignition switches- which will have no cap. Attorney Kenneth Feinberg: SOUNDBITE: KEN FEINBERG, GENERAL MOTORS VICTIMS FUND ADVISOR (ENGLISH) SAYING: "This program is designed to help claimants. This program is not designed to punish General Motors. If people want punitive damages, if they want to use litigation to go after General Motors then voluntarily they should not submit a claim to me." He said he does not know how many people will file claims, or whether the number of deaths linked to the faulty switch would rise above the 13 GM has identified. The formula takes into account- loss of expected wages, pain and suffering, and survivors. Here are the examples given: The first: death claims. For example- the family of a 25-year old married mother of two earning $75,000 would receive $5.1 million. The second kind of case: catastrophic injuries. The example given: a 40-year old married person with no kids earning $70,000, surviving but as a paraplegic would receive $6.6 million. And last: physical injuries. For example, a two-day hospital stay would get $70,000. Victims families attended the press conference. Laura Christian lost her daughter, Amber Marie: SOUNDBITE: LAURA CHRISTIAN, MOTHER OF VICTIM AMBER MARIE (ENGLISH) SAYING: "I am certainly glad that the fund will not require us to be silent. Myself in particular. I know a lot of people know this, I'm an advocate for a lot of different change in the auto industry as well now and so silence was certainly a non starter for me. As far as compensation, you know that really depends. I mean quite frankly money is not the focus you know and it was quite frankly really difficult you know. I mean Amber being reduced to a dollar amount." GM began recalling 2.6 million older-model cars last February, linked to a defective ignition switch- more than a decade after problems were first discovered. Efraim Levy covers General Motors at S&P Capital IQ: SOUNDBITE: EFRAIM LEVY, EQUITY ANALYST, S&P CAPITAL IQ (ENGLISH) SAYING: "General Motors wants to get this news out of the paper as much as possible. As much as recalls are part of doing business you don't want that to be the first thing someone sees in the newspaper in the morning when they are about to go to a dealership and buy a new car." Claims can be filed for five months starting August 1st.