This Week
  • The interior of the Golisano Children's Hospital is starting to take shape.

  • Challenges mount for area companies that do business in Russia.

  • Karen Pudetti left an accounting career to start Luxe Salon, Spa and Laser Center.

  • Money managers do not feel threatened by competition from banks.

  • Lawyer John Moragne learned from mentors to set his career's direction.

  • The Business Person of the Year finalists are profiled.

The truth about GM

Rochester Business Journal
June 20, 2014

A witness before a congressional panel had this to say Wednesday about the report former federal prosecutor Anton Valukas produced on General Motors Co.’s ignition-switch debacle: “The Valukas report … is extremely thorough, brutally tough and deeply troubling. It paints a picture of an organization that failed to handle a complex safety issue in a responsible way.”

Who was the person testifying? GM chief executive Mary Barra. Leader of the company since January, Ms. Barra also said “there is no way to minimize the seriousness of what Mr. Valukas and his investigators uncovered” about GM’s conduct over an 11-year period. That is the plain truth.

GM hired Mr. Valukas in March to determine why it took the company so long to recall the Cobalt and other vehicles equipped with the flawed ignition switch. With “unfettered access,” he and his investigators interviewed more than 230 witnesses and obtained more than 41 million documents.

What they found were “numerous failures leading to tragic results for many.” GM has identified at least 54 frontal-impact crashes—resulting in more than a dozen deaths—in which the faulty switch may have caused the failure of airbags to deploy.

The problem began with a GM engineer’s 2002 decision to use an ignition switch far below the company’s own standards. The staffers given the task of fixing the problem failed to understand it was a safety issue, not simply a matter of “customer convenience,” so proposed solutions were rejected as too costly.

By 2011, the report notes, GM had been warned by outside counsel that it “could be accused of egregious conduct due to its failure to address the problem of airbag non-deployment.” Yet the ignition-switch recall did not begin until February of this year.

No doubt some members of Congress will continue to grandstand on the Valukas report. But let’s be clear: GM’s conduct in this case fully warrants governmental scrutiny and likely sanctions.

Ms. Barra and GM still have much to prove, but her statement that she is “not afraid of the truth” and the steps now taken to be accountable are positive signs, however long overdue.

6/20/14 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


What You're Saying 

There are no comments yet. Be the first to add yours!

Post Your Own Comment

 
Username:
Password:

Not registered? Sign up now!
 

To Do   Text Size
Post CommentPost A Comment eMail Size1
View CommentsView All Comments PrintPrint Size2
ReprintsReprints Size3
  • E-mailed
  • Commented
  • Viewed
RBJ   Google