Barra: Employees Taking ‘Ownership’ of Recall Issue

DETROIT – Speaking ahead of today’s annual shareholders meeting, General Motors CEO Mary Barra says she is pleased with how employees have taken “ownership” of the ignition-switch recall issue.

“I’ve gotten hundreds of emails from employees reaching out…they know what this company can be,” she tells media here today at GM headquarters. “I just feel tremendous engagement by the employees.”

From noon last Thursday to noon on Friday, GM hosted a 24-hour web chat with employees, after GM released the results of an investigation by former U.S. attorney Anton Valukas, who found GM investigators studying the ignition-switch problem as far back as a decade “misdiagnosed” the problem in its early days of 2003 as a customer-satisfaction issue rather than a product defect.

Fifteen employees were dismissed by GM and five were disciplined as a result of the Valukas report.

Barra says she participated in the GM Web chat for two hours, fielding some questions then and afterwards via email.

Employees were “candid,” she says, adding she hopes a result of the recall crisis is “getting people picking up the phone, talking to each other, walking across the aisle” to prevent another issue like ignition-switch issue from ever happening again.

When asked if another similar problem could be burbling under, Barra says GM has “been digging pretty deep” and she doesn’t believe there’s a problem of the magnitude of the ignition-switch problem lurking. “It was a unique series of mistakes over a long period of time.”

Barra reiterates that the amount of compensation for victims and how many victims will qualify for the payout will be determined by Kenneth Feinberg, who GM has hired to create a compensation protocol.

The protocol should be determined by the end of the second quarter, and an estimate of costs should be available then, as well. GM will begin accepting compensation claims Aug. 1. 

Barra says she plans to emphasize to shareholders at today’s meeting GM’s continuing good financial performance, citing the stability of the automaker’s business in North America and continuing good results in China as key points.

“We are very much focused on doing great vehicles and strengthening our brands across the globe…but it’s not about putting (the recall crisis) behind us,” she says. “It’s about using the learnings and failings we had to…improve the whole development process and the culture.”

As for a possible reorganization of GM’s structure to tear down the “silos” cited in the Valukas report that allowed the ignition-switch issue to fester, Barra says there may be some “tweaking.”

With more than 200,000 employees around the world, Barra says a structural reorganization by GM could run the risk of bringing together groups in one area but lead to “distance somewhere else.”

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