Chevrolet's woes are often cited as an example of how good intentions can go wrong when it comes to translation. There are literally thousands of references to the incident on the Internet, and the Nova example has been mentioned in textbooks and often comes up during presentations on cultural differences and advertising.
But there's one major problem with the story: it never happened. As a matter of fact, Chevrolet did reasonably well with the Nova in Latin America, even exceeding its sales projections in Venezuela. The story of the Chevy Nova is a classic example of an urban legend, a story that is told and retold so often that it is believed to be true even though it isn't. Like most other urban legends, there is some element of truth in the story (no va indeed means "it doesn't go"), enough truth to keep the story alive. And, like many urban legends, the story has the appeal of showing how the high and mighty can be humiliated by stupid mistakes.
Even if you couldn't confirm or reject the story by looking into history, you might notice some problems with it if you understand Spanish better than those who spread the story. For starters, nova and no va don't sound alike and are unlikely to be confused, just as "carpet" and "car pet" are unlikely to be confused in English. Additionally, no va would be an awkward way in Spanish to describe a nonfunctioning car (no funciona, among others, would do better), just as in English we'd be more likely to say "it doesn't run" than "it doesn't go."
Additionally, as in English, nova when used in a brand name can convey the sense of newness. There's even a Mexican gasoline that goes by that brand name, so it seems unlikely such a name alone could doom a car.
A logical analysis of the story would also indicate its unlikelihood: It strains credibility to believe that a company as large as General Motors, with marketing executives and other employees and contacts throughout the world, wouldn't be aware of a negative meaning of a product name. In fact, according to one marketing analyst (Cecelia Bouleau, quoted in Business Mexico magazine), GM marketers discussed the possibility of confusion with the name, but "they kept the name and it sold very well. ... I think that the word is sufficiently incorporated into the language as meaning 'new' as in 'bossa nova' that the criticism isn't valid."
GM, of course, isn't the only company to be cited as making advertising blunders in the Spanish language. But upon closer examination, many of these tales of mistranslation prove to be as unlikely and difficult to verify as the one involving GM.