Robert Sherefkin
and David Barkholz

Automotive News | October 7, 2008 - 11:53 am EST

DETROIT — General Motors has ceased equipping its vehicles with a hot-spray windshield washer system that prompted a recall of 944,000 cars and trucks in late August.

Deborah Silverman, spokesman for GM, said today GM has stopped using the system manufactured by Microheat Inc. of suburban Detroit. GM contends Microheat was responsible for the malfunction, but Microheat disputed that finding, she said.

GM awarded the business in 2004.

As a result of the dispute, Microheat Inc. — a once promising automotive technology company — ceased most production and terminated the bulk of its workers at its headquarters, according to three sources with knowledge of the situation.

GM in August recalled about 944,000 vehicles equipped with Microheat’s HotShot system because of concerns over electrical fires, according to a lawsuit filed against GM by the supplier.

GM wants Microheat to pay between $20 million and $25 million for the projected cost of the recall, according to the lawsuit.

Microheat contends the carmaker withheld payments for product shipped in July, August and September. Microheat says GM owes the supplier more than $3.7 million for the parts, tooling and other charges, according to court documents.

Microheat CEO Ron Gardhouse declined to comment on the matter. An employee said at the headquarters told Automotive News that a skeleton staff was winding down operations.

The GM recall affects more than a dozen of the company’s most expensive vehicles equipped with the hot-spray washer.

The affected vehicles are the 2006-08 Buick Lucerne, Cadillac DTS and Hummer H2; the 2008 Buick Enclave; and 2007-08 models of the Saturn Outlook, Cadillac Escalade, Chevrolet Avalanche, Silverado, Suburban and Tahoe and GMC Acadia, Sierra, Yukon and Yukon XL.

Investigators found three reports of fires and 34 possibly related warranty claims.

In its recall notice, GM told the National Highway Traffic Safety Administration that a short circuit on the printed circuit board of the washer-fluid heater could overheat the control-circuit ground wire. To fix the problem free of charge, dealers will install a wire harness with an inline fuse, GM said.

Dealers will have enough parts in stock to begin making repairs around Nov. 1, said GM spokeswoman Carolyn Markey.

GM stops using hot-spray windshield system

Supplier Microheat ceases most operations