General Motors announced today that it has established a compensation program of unspecified value to pay the victims of their ignition switch recalls. So far, there are 54 known accidents resulting from the defects, and 13 known deaths.
The New York Times reported that families of the dead victims will receive at least $1 million. The tally could be much higher, as it is determined by a calculation to estimate lost lifetime earnings, plus an additional $300,000 per spouse or dependent.
The American Giant released a short statement characterizing its actions, which was entirely a quote from CEO Mary Barra:
“We are pleased that Mr. [Kenneth] Feinberg has completed the next step with our ignition switch compensation program to help victims and their families. We are taking responsibility for what has happened by treating them with compassion, decency and fairness. To that end, we are looking forward to Mr. Feinberg handling claims in a fair and expeditious manner.”
Early this morning, Businessweek published a report suggesting the compensation fund would be “uncapped.” Their source is a lawyer representing victims’ interests, who spoke with opposing council. Furthermore, Feinberg, who is said to have autonomy in many of his decisions, is casting a wide net when it comes to determining victims.
In addition to compensation for the families of dead drivers and passengers, anyone injured in a collision with a relevant GM model – whether passengers or bystanders – may be eligible. The report asserts that victims need not have overwhelming evidence GM was at fault, either.
It is quite clear that, while Barra may indeed feel her company’s negligence is culpable for past deaths and injuries, this compensation program is just as much about the present and future. From a public relations standpoint, the corporation is keen to move past the scandal. The company is trying to retain and consolidate the credibility it worked hard to develop after its exit from bankruptcy.
We will notify you of future developments on this story.
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By Nico Grant
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