GM recall process will be under US Congress scanner

Written by Reuters | Detroit/Washington | Updated: Mar 31 2014, 09:00am hrs
When General Motors chief executive Mary Barra faces Congress this week she will have to explain how the top brass at the biggest US automaker can say they knew nothing for more than a decade about a faulty ignition switch linked to crashes and at least 12 deaths.

For lawmakers trying to find who to blame for the lack of responsiveness by GM and its regulator to the tragedies, and in particular the multi-year delay in recalling potentially dangerous vehicles off the roads, it may turn out to be a frustrating couple of days.

GM built a system to deliberately keep senior executives out of the recall process. Instead, two small groups of employees in the vast GM bureaucracy were tasked with making recall decisions, a system GM says was meant to bring objective decisions.

It means that lawmakers may also focus on asking who is responsible for a system that failed so badly that there werent red flags raised for those higher up the food chain.

In this day and age, to think that stuff like this can be kept quiet or forgotten is ridiculous, independent auto analyst and author Maryann Keller said. The right question to ask is who knew, when did they know and why was this not brought forth to be dealt with. Did they hope that it was just going to go away

The company has recalled 1.6 million cars for a problem first noted in 2001, spurring the congressional enquiries as well as investigations by federal safety regulators, who will also testify, the Justice Department, and GM itself.

GM has said Barra and other top executives did not learn of the defective switches until January 31, explaining that smaller groups of lower-level company executives are responsible for leading a recall. Some executives who might use this argument include former CEO Rick Wagoner and his immediate successor Fritz Henderson, who have not discussed the matter publicly.

The process here is supposed to be drilling deep into the data and objectively looking at this and having peer groups question it, and senior management and leaderships influence on that is not a healthy thing, global product development chief Mark Reuss said last week.

GM spokesman Jim Cain said the company was not yet commenting on why the decision to recall took so long. GM is still investigating, he added.

Within the GM community, several former executives contacted by Reuters were asking why the ignition switch problem did not catch the attention of company attorneys, engineers and employees who worked with dealers and processed warranty claims.

Why did these dots not get connected Or worse, if they were connected, why did it take so long to do something said one former executive with experience in service matters, who asked not to be identified and had not heard of the issue while it was developing.

When the ignition switch in older-model cars, including the Chevrolet Cobalt and Saturn Ion, is jostled, a key could turn off the cars engine and disable airbags and other components, sometimes while travelling at high speed.

Safety-related issues always got elevated attention, said a former GM engineering executive. Something like engine stalls would get high priority.

Lawmakers will ask questions that will hold people accountable for the terrible accidents that have occurred, representative Henry Waxman of California, the senior Democrat on the House Energy and Commerce Committee, which is conducting that chambers investigation of GM, said.

Barra will testify in the House on Tuesday and in the Senate on Wednesday.

Barra and the acting head of the National Highway Traffic Safety Administration, David Friedman, are likely to face a barrage of questions from sceptical lawmakers. They may also have to deal with accusations from victims families, some of whom plan to attend the hearings.

A lawyer for some victims families on Saturday invited Barra to meet with them in Washington next week.

They need to hear from you, listen to your voice to know you are truly sorry and that you share in their grief and, to an extent at least, you understand their loss, Robert Hilliard wrote in a letter emailed to Barra and GM lawyers.

GM spokesman Greg Martin said by email: Mary has expressed GMs regret and deep sympathy for all of those affected by the recall. We are determined to earn our customers trust and to take actions necessary to make our safety processes world class. Arranging a meeting in the media is not respectful to the families. We will respond directly to the invitation.

Members of Congress, as well as safety advocates, want to know whether senior GM executives may have learned of the issue long before it surfaced in late 2013 and led to last months recall. Wagoner declined to comment, while Henderson and former North American chief Gary Cowger could not be reached.

The two Congressional committees are likely to decide on additional hearings and witnesses after they digest GM and NHTSA documents they have received and the information gleaned from next weeks hearings.

Barra has repeatedly apologised for the companys handling of the matter and said GM would focus on taking care of customers, and company officials have stressed cooperation in all investigations.

She may get some credit from lawmakers for that attempt at transparency.

GMs CEO gets high marks for admitting wrongdoing. On the other hand, she hasnt been there very long, said Senate commerce committee chairman Jay Rockefeller, a West Virginia Democrat, who is overseeing the Senate hearing.

The senator said he would look at papers and listen to testimony before deciding about GM, and that the panel will be looking for explanations. You have to have lessons, he said.