March 19, 2014 in Business

General Motors offers apology

Recall delay details scarce thus far, but firm investigating
Tom Krisher Associated Press
 

Barra
(Full-size photo)

DETROIT – The top executive of General Motors apologized for deaths linked to the delayed recall of 1.6 million small cars, saying the company took too long to tell owners to bring the cars in for repairs.

Faced with a crisis just months into the job, CEO Mary Barra has put herself front and center in the company’s efforts to take responsibility for mishandling a defect with ignition switches in small cars, and to ward off a threat to its sales and reputation. She named a new head of global safety, one day after telling employees that GM is pushing to resolve safety issues more quickly.

Barra, who met Tuesday with reporters for the first time since last month’s recall, stopped short of saying the company would compensate families of those killed in crashes caused by faulty ignition switches. But she said GM would do what’s right for customers after it completes an internal investigation, which she expects to take about seven months to finish.

“I am very sorry for the loss of life that occurred, and we will take every step to make sure this never happens again,” she said.

Barra is trying to distance the GM she now runs from the prebankruptcy company that buried the problem in bureaucracy. The company has acknowledged it learned about the problem switches at least 11 years ago, yet it failed to recall the cars until last month. Barra is likely to testify next month before two Congressional committees investigating the recall. There, she’s sure to face questions about what went wrong at the old GM.

The Justice Department also is investigating whether any laws were broken in the way GM handled the recall.

Barra, who became CEO on Jan. 15, said Tuesday that she found out about the switch problem in late December and had no knowledge of it before that.

The company has been profitable for 16 straight quarters since emerging from bankruptcy protection in 2009.

Barra said no one at GM has been fired or disciplined because of the recall delays, but Mark Reuss, the company’s product development chief who also spoke with reporters, said appointing a safety chief is only the beginning.

“This is the first change of things that need to change,” Reuss said.

There were a number of questions Barra and Reuss wouldn’t answer: about why the recall was delayed; how high in the company did the information go; and why there were communication breakdowns. They said they preferred to wait for the results of the investigation by an outside attorney before giving details.

Barra said GM is looking through its database for more crash deaths that could be tied to the ignition switch problem. That number is likely to rise above the 12 currently cited by the company as GM and the National Highway Traffic Safety Administration review accident reports and consumer complaints.

Before the meeting with reporters, GM named a veteran company engineer, Jeff Boyer as its new safety chief, placing a single person in charge of recalls and other safety issues.

Barra said she expects all the cars to be repaired by sometime in October.

Shares of General Motors Co. rose 54 cents, or 1.6 percent, to $35.17 Tuesday. The shares fell nearly 10 percent last week as the various investigations were announced. They’ve risen more than 3 percent so far this week.

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