GM to Recover $1.9 Billion in Bolt-Recall Costs in Deal With LG

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Korean company to reimburse GM due to manufacturing defects in battery modules supplied by LG for electric vehicle

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In its third-quarter earnings later this month, the Detroit auto maker said it expects LG to report recoveries of about $1.9 billion of the $2 billion related to the safety action, the most expensive in its history. .

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LG did not immediately respond to a request for comment.

The Bolt recall has been a high-profile misstep for GM to emerge as a leader in electric vehicles. It is set to introduce dozens of new electric models in the coming years and is aiming to eventually overtake Tesla, the electric-vehicle leader in US sales. The Bolt is GM’s only electric vehicle for sale in the US today.

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GM has said the defect involved a potential manufacturing problem at the LG factories that resulted in two defects in some battery cells that could have caused a fire. The auto maker had earlier said it was in talks to reimburse the company to LG for some of the recall costs.

For months, GM has been asking Bolt owners to take the Bolt outside immediately after charging, not to park it inside overnight, and to leave a sufficient distance from other cars inside the parking garage. Many Bolt owners have said they are bothered by the risk of fire and delays in fixing their cars.

The auto maker said in September that the companies had worked to fix the problem and expected to begin replacing defect-free battery cells and modules in the recalled cars in October. In a statement on Tuesday, GM purchasing and supply-chain chief Shilpan Amin said the automaker expects to begin repairing the vehicles this month.

“LG is a valued and respected supplier to GM,” Mr. Amin said. “Our engineering and manufacturing teams continue to collaborate to accelerate production of new battery modules.”

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GM said Tuesday that LG will reimburse the carmaker due to manufacturing defects in the battery module. An earlier version of this article incorrectly stated that GM announced Monday. (corrected October 12)

Mike Colias at [email protected]

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