A great deal has been happening involving the General Motors safety problems over the past few days. In fact, you need to be on your toes to keep up with all of the recalls. It’s most significant that the criminal investigation now appears to be in high gear. That has to have gotten the attention of several key folks at GM. On June 30, as we were getting ready to send this issue to the printer, Ken Feinberg announced the GM compensation plan. I will discuss this plan in some detail under a separate heading. Also late on June 30, GM recalled another 8.4 million vehicles, bringing its total for the year to about 29 million!
The automaker’s testimony in front of a congressional committee last month left me even more convinced that GM executives had to have been aware of the deadly safety defects surrounding the ignition switch in its vehicles. If GM bosses and top management didn’t know of a defect that was around for more than 10 years, the company is even worse than I thought.
GM CEO Mary Barra, on June 18, made her second appearance before the Congressional Committee on Energy & Commerce Subcommittee on Oversight and Investigation. Accompanying Ms. Barra this time was Anton Valukas, the lawyer who was hired by GM to do a so-called independent evaluation of the automaker’s conduct. If GM’s conduct is not criminal, it’s as close to it as anything I have observed over the years.
The hearing testimony by both Ms. Barra and Mr. Valukas left a great deal unanswered and it’s quite obvious that much work is yet to be done. No reasonable person would believe that top management at GM didn’t know about there most serious safety problems involving the ignition switch, which was labeled the “Switch from Hell” by the very engineer who designed it. GM was described during the hearing as being both incompetent and negligent for a period of 11 years. That finding relating to safety issues came directly from the Valukas report. To say that is a shocking assessment is a gross understatement. It has to be greatly concern folks who are driving GM vehicles.
The new CEO of GM wanted the Congressional Committee to believe that top management for more than a decade was totally in the dark about a most serious safety issue. That is especially disturbing considering during that decade hundreds of innocent victims were being killed and seriously injured. GM had actual knowledge of at least some of the deaths, if not all, during that time. It now claims that 13 victims were killed. Of course we know that number is very much larger. In fact, it’s been estimated that more than 300 were killed.
GM needs to come clean and start telling the complete truth about what GM knew, who all knew it, and why nothing was done. After the hearing, we are still not getting the complete truth. To finally get the full truth about the safety culture and performance at GM, it will require the total involvement of the civil and criminal justice systems. I am concerned that GM can’t be trusted to do the right thing for the hundreds of families who have buried loved ones killed because of GM’s wrongdoing and massive cover-up.
As has been widely reported, the ignition switch in the GM vehicles can move from the “run” position to the “off” or “accessory” position, disabling power steering and brakes during operation, in most cases also deactivating the airbags. In February 2014, only after evidence was discovered in the wrongful death lawsuit filed by Ken and Beth Melton, did GM do anything to acknowledge the existence of the safety problems. When you consider that GM had longstanding knowledge of the ignition switch defect, the long delay is most disturbing with the deadly consequences of the delay and cover-up being even more disturbing!
The company – because of the Melton lawsuit – started recalling its affected vehicles for the first time this year. That recall now encompasses 2.6 million vehicles, and GM will now have to admit that there were many more than 13 deaths related to the defect. GM has claimed that it “fixed” the “Switch from Hell” in 2006. Last month, however, GM recalled an additional 3.4 million midsize and large cars for the very same ignition switch defect. The model years in that recall were 2010-2014. There were also 50,000 Chevrolet Camaros recalled for a key fob problem. Now we see 8.4 million GM vehicles recalled on June 30 for the very same ignition switch problems that we saw in the Cobalts.
A criminal subpoena from the U.S. Attorney’s office in the Southern District of New York has been issued to GM. I predict there will be lots of GM officers, engineers and maybe a few lawyers who will be taking advantage of the 5th Amendment to the U.S. Constitution when they are called to appear before the grand jury. In fact, eventually I believe several GM officers, engineers and perhaps some others will be charged with a criminal offense.
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