William Simpson
General Motors and LG are establishing a $150 million fund to compensate Chevrolet Bolt owners after a faulty battery caused some of the electric vehicles to catch fire.
The $150 million is part of a legal settlement between GM and Bolt owners who have filed a lawsuit. collective action against the Michigan automaker in 2020 for allegedly selling them a vehicle with a defective battery. Bolt owners who installed special software offered by GM to fix battery problem could receive $1,400 from the fund, according to court documents filed Thursday night in Michigan. Bolt owners who sold their cars before that date, or drivers who leased the Bolt before then, are entitled to a $700 payment, according to the documents.
“GM, LG Energy Solution and LG Electronics have agreed to a settlement with plaintiffs to resolve class action litigation related to the Bolt EV battery recall,” GM said in a statement Friday. “As a result, Bolt owners who have received a battery replacement or who have installed the latest advanced diagnostic software may be eligible for compensation.”
GM partnered with subsidiaries of South Korea-based electronics company LG to create the batteries used in the Bolt, which debuted in 2015. In the years since, drivers have noticed that their cars will spontaneously catch fire, leading owners to register claims about the issue with GM and the National Highway Traffic Safety Administration.
GM attributed the fires to a manufacturing defect in the battery modules, which the automaker said caused a short circuit in the battery cell. Some of the incidents occurred in Bolts with battery cells made in South Korea, while other fires occurred in cells manufactured at an LG factory in Michigan. In 2021, GM recalled all Bolts worldwide.
GM sold just under 25,000 Bolts in the US before telling dealers to stop selling them. The company production of the vehicle has ceased in December 2023, a major financial and reputational blow to GM as automakers raced to enter the electric vehicle market. The automaker has spent $1.8 billion Bolt recall over battery issues.
The Bolt was one of GM’s first all-electric vehicles, second only to the Spark EV, which debuted in June 2013. Since then, GM has released an electric Hummer, Chevrolet Silverado and Cadillac Lyriq.
GM said it plans to stop manufacturing gasoline powered cars by 2035 and will spend $35 billion to launch more than 30 new electric vehicles globally by 2025, including about 20 in North America. By the end of the decade, GM expects to generate $90 billion in additional annual revenue from electric vehicles.
