Daily Dispatches
General Motors CEO Mary Barra speaks during a news conference on Capitol Hill.
Associated Press/Photo by Cliff Owen
General Motors CEO Mary Barra speaks during a news conference on Capitol Hill.

Lawmakers: GM needs to clean house

Business

WASHINGTON—Congressional lawmakers on Wednesday berated General Motors CEO Mary Barra about a corporate “culture” that created a lack of accountability for safety issues, suggesting fresh blood might be needed at GM’s highest levels.

GM has issued a record 44 recalls this year, affecting more than 20 million vehicles.  The latest recall Monday included more than 3 million cars from 2000 and 2014 and dealt with a similar ignition switch problem that caused the confirmed deaths of 13 people.

Even with these measures, the company has only fired 15 of its more than 200,000 employees over the problem. That did not impress the lawmakers at Wednesday’s hearing.

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“If you don’t change the people, how do you change the culture?” asked Rep. Tim Murphy, D-Pa., chairman of the Committee on Energy and Commerce’s subcommittee for oversight and investigations.

Wednesday marked the first time Barra appeared before Congress since GM released the report from its internal investigation. When Barra last testified on Capitol Hill in April, she said she wouldn’t disclose much information until the report was complete. The 325-page document, released earlier this month, stated a lack of accountability at GM allowed the issues to persist.

As lawmakers demanded answers from Barra, they glanced to the back of the room where pictures taped to the wall showed the faces of people who died because of faulty ignition switches. The recalls focus on a wide range of issues, but the ignition switch recall is by far the most serious.

GM employees knew for more than a decade the ignition switch was faulty. When the key is jolted, the car goes into accessory mode, disabling the air bags and causing the power brakes and steering systems to malfunction.

The House panel pressed for answers about how the engineering oversights happened and why it took so long for GM to act. Lawmakers worried aloud that Barra’s actions so far haven’t been enough.

Barra agreed changes must take place from within. She admitted more than 15 people partook in the “GM Nod,” a term adopted for the gesture used at GM meetings when everyone dismissed a problem with a knowing nod rather than a solution.

Rep. G.K. Butterfield, D-N.C., pointed out that most, if not all, of the 40 recently hired safety investigators at GM rose from the GM ranks.

“I would strongly suggest that you look at bringing in some fresh blood from outside the company,” he said.

Barra said GM is working on setting up a compensation fund “in lieu of lawsuits” for those who were seriously injured or for the families of the deceased. But no compensation solution exists for those GM buyers who will lose money with the drop in resale prices for affected vehicles.

Barra said the deaths didn’t just pose a business challenge.

“I never want anyone associated with GM to forget what happened,” she said. “I want this terrible experience permanently etched on our collective memories.”

At the hearing, Rep. Phil Gingrey, R-Ga., mentioned the Brooke Melton lawsuit, which WORLD covered in its June 14 issue. This case first alerted the public about the faulty ignition switch, leading GM to recall 2.6 million vehicles.

“If not for the Brooke Melton lawsuit, would we even know about this fault today?” Gingrey asked.

Barra has said she was not fully briefed on the problem until January, when she became CEO.

“That the most senior GM executives may not have known about a defect that caused more than a dozen deaths is frankly alarming and does not absolve them of responsibility for this tragedy,” said Rep. Diana DeGette, D-Colo.

Allie Hulcher
Allie Hulcher

Allie is a World Journalism Institute intern.

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