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Speaking for first time, GM CEO Barra says she’s ‘personally’ sorry about car recall

By Jeff Green
Bloomberg News

DETROIT: General Motors Chief Executive Officer Mary Barra, speaking to the press for the first time about the recall of 1.6 million small cars, personally apologized for “everything that has happened” and extended condolences to affected families.

“I want to start by saying again how sorry I am personally and how sorry General Motors is for what has happened,” Barra said. “Clearly lives have been lost and families are affected, and that is very serious. We want to just extend our deep condolences for everyone’s losses.”

Barra said it “took too long” to recall the cars that stalled and killed 12 people. Earlier on Tuesday, she appointed a new safety chief to ensure defects get a more timely resolution. “Our goal is that something like this will never happen again.”

Barra, speaking to reporters at the company’s Detroit headquarters, said she first learned about an analysis of the stalling cars in December, weeks before she become CEO, and that she was informed of the decision to recall cars on Jan. 31. GM’s board of directors was notified after the recall was filed. In the future, directors will be informed sooner, Barra said.

What Barra, 52, and others at GM knew and when is the goal of the company’s internal investigation into why the automaker took so long to recall 1.6 million Cobalts and other small cars. The replacement of ignition switches was announced last month, years after customers started complaining that the autos could switch off if bumped or driven with a heavy key chain.

Barra and Mark Reuss, who runs product development appeared at the head of a table, flanked by reporters, in a conference room. Barra read short remarks from a single, unmarked blue folder. Reuss consulted a thicker dossier.

The automaker has determined all the models that used the faulty switch, said Reuss. Owners can drive loaner vehicles at GM’s expense until their cars are fixed. The company hasn’t contacted families of those killed in its cars, Barra said, adding that it may do so after concluding its internal investigation, which may take a few months.

Barra said a key step in fixing the GM system for recalls was her announcement of creating a new global vehicle safety position and promoting a 40-year engineering executive to run it. Jeff Boyer, who joined GM in 1974, will have global responsibility for identifying and resolving product-safety issues.

Aside from disavowing prior knowledge of the problem, Barra didn’t say much, according to Matt Stover of Guggenheim Securities. “Everything else was right from the playbook,” he said. “She handled herself well, but I don’t think she really told us anything. But you have to get out and talk.”

Barra’s job isn’t “on the line,” though how she handles this crisis will define her as GM’s CEO, said Brian Johnson, an auto analyst at Barclays in Chicago.

“This is the Tylenol moment for her, where the company is either seen as quickly and thoroughly addressing the issue or seen as dragging its feet and denying reality,” Johnson said. “She was kind of quiet the first week, but this week they seem to be stepping up.”


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