GM’s Barra faces grilling from US lawmakers

General Motors CEO Mary Barra and Anton Valukas, head of GM's internal recall investigation, testify on the GM ignition switch recall during a US House Oversight and Investigations Subcommittee in Washington on June 18, 2014

Barra returned to testify to a House of Representatives committee panel, after being unable to answer many questions in an April 1 hearing, armed with the results of an internal GM investigation on how and why it took the company more than a decade to recall millions of vehicles after ignition problems were known.

The report by Anton Valukas found that GM failed to see the safety implications of the defective ignition switch, which could inadvertently turn to the “off” position, cutting off electrical systems and preventing airbags from deploying.

“The Valukas report, as you know, is extremely thorough, brutally tough and deeply troubling,” Barra told the House oversight subcommittee.

“It paints a picture of an organization that failed to handle a complex safety issue in a responsible way,” said the CEO, a GM veteran who took the company’s top job in January, just weeks before GM started to recall 2.6 million Cobalt and other compact cars for the ignition-switch defect.

“Our responsibility is to set a new norm and a new industry standard on safety and quality,” she said, outlining steps the company has taken to address safety issues and a corporate culture that lacked accountability.

The company has dismissed 15 employees identified as being involved in the ignition switch problem, launched efforts to improve the quality and safety of its vehicles, and stepped up reviews that have led to the recalls totaling about 20 million vehicles since the start of the year.

But the lawmakers, who opened their own investigation of the issue in March, said evidence shows the company is still not doing enough to protect consumer safety in a company culture that does not effectively consider stalling a safety issue.

Congressman Fred Upton pointed to evidence that GM ignored reports in 2005 that Chevrolet Impalas had an ignition switch problem that caused stalling, and that GM only recalled 2006 Impalas on Monday.

“Stalling is a significant issue,” said Barra, explaining the company’s decision for the latest recall as a sign the largest US automaker was serious about changing its focus.

– Death toll in question –

The company says it knows of 54 ignition-related accidents and 13 deaths since 2004. The National Highway Traffic Safety Administration says the death toll could be higher.

“What is particularly frustrating about GM is that the company appeared in no great hurry to figure out the problems with its vehicles,” said Tim Murphy, chair of the panel.

“Despite customer complaints, reports from GM’s own engineers that they were able to turn off the ignition switch with their knees during test drives, and finally, reports of deaths, it was not until 2009 that GM figured out the airbags had any connection to the power mode status of the car.”

The automaker is reportedly under Justice Department investigation over the decade-long delay to taking action on the problem.

It is also facing multiple lawsuits that analysts say could ultimately cost the company billions of dollars in damages.

GM has said it would take a charge of about $700 million for recall repairs in the second quarter, including the $400 million provision it previously announced.

That brings to $2.0 billion the amount set aside for recall costs in the first half of the year.