Faced with a crisis just months into the job, CEO Mary Barra has put herself front and centre 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 pre-bankruptcy 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.
David Cole, the former head of the Center for Automotive Research in Ann Arbor, Mich., and the son of a former GM president, said it was the first time in his memory that a GM CEO has apologized for a safety problem. But the magnitude of the recall is also very rare, he said.
"I think Mary will be extremely forthright. She won't be blowing smoke at anybody. That's not her style," he said. "I think she is doing exactly the right thing."
GM has to protect its safety reputation to keep sales from falling and profits from slipping. 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.
Reuss called Boyer a "safety zealot" and Barra said she has known him since the 1980s. "He will have no qualms if he has an issue or concern, of raising that forward," she said.
On Feb. 13, GM announced the recall of more than 780,000 Chevrolet Cobalts and Pontiac G5s (model years 2005-2007). Two weeks later it added 842,000 Ion compacts (2003-2007), and Chevrolet HHR SUVs and Pontiac Solstice and Saturn Sky sports cars (2006-2007). All of the recalled cars have the same ignition switches.
The company said the ignition switches can wear from heavy, dangling keys. If the key chains are bumped or people drive on rough surfaces, the switches can suddenly change from the "run" position to "accessory" or "off." That cuts off power-assisted steering and brakes and could cause drivers to lose control. Also, the air bags may not inflate in a crash and protect the driver and passengers.
GM is urging people not to put anything on their key rings until the switches are replaced.
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 per cent, to $35.17 Tuesday. The shares fell nearly 10 per cent last week as the various investigations were announced. They've risen more than 3 per cent so far this week.