GM CEO grilled over traffic deaths

US lawmakers question carmaker's CEO amid claims fix for faulty ignition switch would have cost 57 cents.

Last updated: 02 Apr 2014 07:15
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The fix for a faulty ignition switch linked to 13 traffic deaths would have cost just 57 cents, members of Congress said as they demanded answers from General Motors' new chief executive on why the carmaker took 10 years to recall cars with the defect.

At a hearing before a House subcommittee on Tuesday, GM's Mary Barra acknowledged that the company took too long to act. She promised changes at GM that would prevent such a lapse from happening again.

"If there's a safety issue, we're going to make the right change and accept that,'' said Barra, who became chief executive in January and almost immediately found herself thrust into one of the biggest product safety crises Detroit has ever seen.

Since February, GM has recalled 2.6 million cars, mostly Chevrolet Cobalts and Saturn Ions, over the faulty switch, which can cause the engine to cut off in traffic, disabling the power steering, power brakes and air bags and making it difficult to control the vehicle.  

As relatives of the crash victims looked on intently, Barra admitted that she did not know why it took years for the dangerous defect to be announced. She deflected many questions about what went wrong, saying an internal investigation was under way, the Associated Press reported.

The carmaker said new switches should be available starting April 7.

Switch problem

Diana DeGette, a Democrat, held up a switch for one of the cars and said a small spring inside it failed to provide enough force, causing engines to turn off when they went over a bump.

DeGette showed how easy it was for a light set of car keys to move the ignition out of the "run'' position.

GM has said that in 2005 company engineers proposed solutions to the switch problem, but the carmaker concluded that none represented "an acceptable business case'.'

"Documents provided by GM show that this unacceptable cost increase was only 57 cents,'' DeGette said.

The 57 cents is just the cost of the replacement switch. The figure does not include the labour costs involved in installing the new part.

Under questioning, Barra said GM's decision not to make the fix because of cost considerations was "disturbing'' and unacceptable, and she assured members of Congress that that kind of thinking represents the old General Motors, and "that is not how GM does business'' today.

She testified that the inexpensive fix to the switch, if undertaken in 2007, would have cost the company about $100m, compared with "substantially'' more now.

Barra also announced that GM has hired Kenneth Feinberg, who handled the fund for the victims of September 11, the Boston Marathon bombing and the BP oil spill, to explore ways to compensate victims of accidents in the GM cars.

She stopped short of saying GM would establish such a fund.


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