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GM reaches deal with LG to pay for Bolt battery recall costs

GM reaches deal with LG to pay for Bolt battery recall costs

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US auto sales slump, stalled by car computer chip shortage

FILE - In this Sunday, Sept. 12, 2021, file photo, a pair of unsold 2022 Bolt electric vehicles sit outside a Chevrolet dealership in Englewood, Colo. U.S. new vehicle sales tumbled in September as a global shortage of computer chips worsened, shuttering factories and limiting the selection on dealer lots. (AP Photo/David Zalubowski, File)

DETROIT — LG Electronics has reached a deal with General Motors to pay $1.9 billion to $2 billion to reimburse the automaker for the cost of recalling Chevrolet Bolt electric vehicles due to the risk of battery fires.

The automaker, which announced the deal in a statement early Tuesday, says it will show the estimated recovery in its third-quarter earnings to offset charges associated with the recalls.

In August GM expanded a previous recall to more than 140,000 Bolt electric vehicles sold worldwide since 2016 because a battery manufacturing defect could cause the vehicles to catch fire.

The company said that in rare cases, batteries that have two manufacturing defects can cause fires.

General Motors said in September that production had resumed for battery modules used in recalled Bolts, and that customers could start getting replacement parts by mid-October.

The recall follows reports of 13 battery fires, GM said, which can occur when two separate defects are present in the battery modules.

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