Tuesday, 1 April 2014

GM faces Congress' furor over deadly ignition defects: Watch live..


Family members of victims of the GM recall failure arrive to hold a news conference on the U.S. Capitol grounds in Washington
Family members of victims of the GM recall failure arrive to hold a news conference on the U.S. Capitol grounds in Washington April 1, 2014. General Motors has not yet reported to federal regulators the "vast majority" of 133 cases of safety concerns about ignition switches, House of Representatives Democrats said on Tuesday ahead of congressional testimony by General Motors (GM) Chief Executive Mary Barra. REUTERS/Jonathan Ernst (UNITED STATES - Tags: POLITICS TRANSPORT BUSINESS)
A moment of reckoning arrives this afternoon for General Motors, as America's largest automaker will face intense questions from Congress about why it delayed and denied a deadly defect existed in some 2.6 million vehicles.
The hearing in front of the U.S. House Energy and Commerce subcommittee on investigations will feature GM chief executive Mary Barra, who has said the company isn't sure why it did what it did, along with regulators from the National Highway Traffic Safety Administration who blame GM for withholding key details that they say could have spurred the agency to act earlier. Since launching a review of its safety process last month, GM has recalled some 7 million vehicles worldwide.
Last night, Barra met with family members of people who had died or were injured in crashes from the bad ignition switches; many of them later turned up outside the Capitol this morning. GM acknowledges at least 13 deaths linked to the ignition switches in Chevy Cobalts and other GM cars; safety advocates say the number could be far higher. "This car was surely a death trap," Samantha Denti, of Toms River, N.J., told USA Today. "Driving this car was like playing a game of Russian roulette."
You can watch the hearing live starting at 2 p.m. EDT below; we'll have running updates on the key moments from the hearing as well; refresh this page for the latest.

1:45 PM: For those who want to skip ahead a bit, here's Mary Barra's prepared testimony and that of David Friedman, interim cheif of the National Highway Traffic Safety Administration.
1:50 PM: The Center for Responsive Politics has the numbers on GM's campaign donations to the House committee asking questions today
Twenty-one members, or more than 40 percent of the House Energy and Commerce Committee -- which today will question Barra on the company's previous knowledge of the faulty technology that has been blamed for 13 deaths -- have been helped by cash from GM's PAC in the 2012 or 2014 election cycles, according to an OpenSecrets Blog analysis. The company has given $72,000 to the committee's members from 2011 through 2013, or about $3,500 to each member who received donations.
2:05 PM: Subcommittee chairman U.S. Rep. Tim Murphy, R-Penn., runs through the history of GM's igntion problem — how it passed on a recall in favor of telling consumers to take off heavy keychains, and how NHTSA investigated the problem twice without ordering a recall.
"The red flags were there for GM and NHTSA to take action," Murphy said, "but for some reason it didn't happen." He adds: "To borrow a phrase, what we have here is a failure to communicate, and the results were deadly."
2:10 PM: Rep. Diana DeGette, D-Colo., holds up a defective GM switch assembly and demonstrates how the keys turn. "If you had a heavy keychain like my mom keychain, or if you were short and your knee bumps the key, you can easily switch it off," she says.
"Time and time again, GM did nothing. The company continued to sell cars knowing they were unsafe."
2:15 PM: Rep. Fred Upton, R-Mich., notes he oversaw the committee hearings into the Ford-Firestone defects, which led to tougher laws requiring automakers share defect data with federal regulators to help spot problems early. Two of the 13 deaths linked to the problem happened in his district. "It's deja-vu all over again," Upton says.
2:25 PM: Barra is sworn in, and reads her statement, apologizing to the victims and saying GM is not sure why the recall took so many years to launch. She says GM has already loaned 13,000 vehicles to people who are getting their cars fixed. Sitting behind her is Mark Reuss, head of GM's global vehicle development, and GM's top lawyer.
2:33 PM: Barra reveals that GM has hired Ken Feinberg, the attorney who's overseen settlements from Sept. 11, the Boston Marathon bombing and the BP oil spill among others as a consultant to work on compensation for owners. This move comes after some lawmakers had pressed the company to set up a multi-billion fund for victims. (Feinberg also served as the special master for the U.S. Treasury setting executive pay for bailed-out companies in 2009 and 2010 — including at General Motors.)
2:38 PM: Under questioning from Murphy, Barra says she finds the idea that the ignition switches weren't fixed becuase of cost "very disturbing." When asked how the automaker balanced cost and safety, Barra says: "We don't. If there's a safety issue we take action...We've moved from a cost culture after the bankruptcy to a customer culture."
2:47 PM: Upton asks Barra why GM changed the igntion switch without changing the part number — a key mistake that made the problem much harder to track. Barra admits that was a mistake, but says it's not clear why that happened. As for why complaints never led to a recall: "There was information in one part of the company and the other part didn’t have access to that."
2:57 PM: Rep. Marsha Blackburn, R-Tenn., draws out from Barra that GM's senior leaders didn't know about the problem until Jan. 31 of this year, and that her predecessor as CEO, Dan Akerson, was not aware of it either. Barra declines to answer Blackburn's question of whether "it was a cover-up or sloppy work," or if it had any connection with GM's $50 billion bailout, saying GM's investigation was looking into those questions.
3:09 PM: Rep. Joe Barton, R-Texas, asks an engineering question: "Why in the world would a company with a stellar reputation as GM purchase a part that would not meet its own specifications?"
"I want to know that as much as you do" says Barra. "That's not how we work today."
Barton presses, and Barra says there are exceptions to when a part might be accepted after testing if it didn't meet GM's specifications. Barton, flashing the first temper of the hearing, calls her response "gobbledygook," adding "there's no reason to have specifications if you don't enforce them."
Barra says, again, that GM's investigation was looking into those questions.
3:15 PM: Rep. Bruce Braley, D-Iowa, pulls out a tiny screwdriver and cap that he said was a promotional item GM gave out two decades ago, emblazoned with the slogan "Safety Comes First At GM." He uses the part in an attempt to explore whether GM's past promises were truthful or mere marketing blather:
"Hasn't the core values of GM always been that safety comes first?" Braley asks
"I've never seeen that part before," Barra replies. "All I can tell you is that today's GM is focused on safety," and she lists the safety aspects of current models.
"But we're talking about these vehicles (under recall) and what's changed," Braley replies.
"This incident took way too long, that's why we're making radical changes...we will continue to make process changes and people changes," Barra replies.

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