Wednesday, 23 October 2013

India Eyes GM Over Emissions Testing - Wall Street Journal




An Indian government investigation alleges that General Motors Co.'s India unit misled government inspectors about emissions-tests results for the company's Tavera sport-utility vehicle, said an official in the country's heavy-industries ministry.


General Motors India Pvt. in July recalled 114,000 Taveras made over the past eight years and suspended production of the vehicle because they fell short of India's emissions standards for diesel vehicles.


The Tavera costs between $11,760 and $17,753, and is one of GM's top-selling models in India.


A report by a three-person panel appointed by the Ministry of Heavy Industries alleged that GM India falsified emissions tests and misled government officials during prearranged inspections of the factory, the official in the heavy industries ministry said.


The investigation report has been forwarded to the Ministry of Road Transport and Highways, which sets emissions standards. The ministry will review the findings and determine what penalties, if any, to impose on GM India, which could range from a fine to criminal prosecution, said the heavy-industries ministry official.


Vijay Chibber, secretary in the transport ministry, declined to comment Wednesday, saying he has yet to read the report.


The report has not been made public.


GM India issued the recall notice after discovering that the vehicles did not meet emissions standards.


"We determined there was an emissions problem. We investigated it and identified violations of company policy," said P. Balendran, vice president at GM India. He did not elaborate on what policies were violated. Mr. Balendran said 15 employees have either been fired or submitted their resignations as a result of the recall.


The government panel also investigated whether Indian inspectors knew if GM inspectors were allegedly involved in falsifying emissions tests. The official at the heavy-industries ministry said that no evidence of collusion between the inspectors and GM India had been found.


In the wake of the recall, the Indian government said it would introduce a mandatory vehicle-recall policy. A voluntary recall system set up by the Society of Indian Automobile Manufacturers, an industry body, has been in force since July 2012. More than 580,000 vehicles have been recalled since then.


The heavy-industries ministry official said the mandatory recall policy should be in place in three months.







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