After 11 years of incompetence and failing to act over defective Chevrolet Cobalt ignition switches, GM released an internal probe today that said Mary Barra, CEO and Mark Reuss the head of global product development were unaware of the safety issues that are known to be responsible for at least 13 deaths, maybe more.
On Monday, former U.S. Attorney Anton Valukas presented the findings of his investigation into GM ignition switches that caused airbag failures to the GM Board of Directors. The Valukas report, paid for by GM, was the result of an inquiry that was claimed by GM to have “complete independence” covering the activities of the people working on it from the law firm Jenner & Block. The investigation covered more than 350 interviews with at least 230 individuals and examined – it’s said – 41 million documents.
CEO Barra said the Valukas findings were “extremely thorough, brutally tough, and deeply troubling. Overall the report found that, from start to finish, the Cobalt saga was riddled with failures which led to tragic results for many.”
Barra said 15 individuals who were determined to have acted inappropriately on the ignition switches are no longer with the company. Disciplinary actions have been taken against five other employees. GM declined further comment about whether these were retirements or dismissals or buyouts, and would not name names, and would not release the Valukas report. NHTSA – looking just as culpable – subsequently released a redacted version of the report.
At the end of the Barra press conference, GM stock was up, trading at more than $36 a share with dividend yield of ~3.3%.
On February 7, 2014, GM notified NHTSA that a safety defect existed in 619,122 model year 2005-2007 Chevrolet Cobalt and MY 2007 Pontiac G5 vehicles. On February 25, 2014, GM submitted a second so-called Part 573 Report notifying NHTSA that an additional 748,024 vehicles contain the same safety defect. Those additional vehicles are the model ear 2006-2007 Chevrolet HHR and Pontiac Solstice, 2003-2007 Saturn Ion,
and 2007 Saturn Sky vehicles.
NHTSA now has a copy of the report, and more federal fines – civil and criminal – will likely follow in AutoInformed’s view. The Department of Transportation, which NHTSA is part of, did not immediately comment. Moreover, the agency has not yet released the Valukas Report. There is also the question of how NHTSA let this go on so long? The agency appears as if it acted – or rather non-acted – as badly as GM.
“I will share my perspective and announce some actions in response to the report. My understanding is NHTSA, our regulator, will post the full report on their website, which is available for anyone to review,” said Valukas.
The Center for Auto Safety reacted harshly. “The Valukas report is little more than an elaborate whitewash that buys into GM’s arguments that it was a bunch of incompetent engineers, lawyers and mid-level managers who were fired as a result,” CAS said in a statement.
“The report further buys into GM’s argument that this is an airbag defect which limits the number of victims and liability. The report completely ignored the biggest source of information at GM on the defect – 2,004 death and injury claims reported to NHTSA by GM itself on the recalled vehicles through 2013. Despite claiming to have interviewed over 230 people and examined over 41 million documents, the report did not interview anyone or collect any documents on the fatal decision in 2001 to use the deadly short plunger detent ignition switch over the safe long plunger switch used as the silent remedy in 2006,” said CAS.