General Motors executives knew much more about the design flaw in the ignition switch installed in its small cars during the past decade much earlier than GM has officially acknowledged, according to two long-standing critics of the auto industry’s efforts at automotive safety.
In an open letter to GM CEO Mary Barra, Joan Claybrook, president emeritus of Public Citizen, and Clarence Ditlow, executive director of the Center for Auto Safety, said it was time GM came clean about how and when the decisions were made to use the cheaper ignition switch and to replace them half a decade later without changing the part number or notifying federal regulators, which could have triggered a recall by GM.
GM had no immediate comment on the Claybrook-Ditlow letter.
The original decision was probably dictated by costs, combined with the general antipathy towards small cars and federal fuel economy regulations that prevailed at the time on GM’s North American Strategy Board, which set the course for the entire company.
The facts around the second decision are more complex and it has been targeted by both GM’s own internal investigation and by federal prosecutors in New York and federal regulators in Washington D.C. as well as by Congressional committees.
GM also already suspended two engineering managers involved in the decision. But lawyers for plaintiffs suing GM have also demanded more information from higher executives, including Lori Queen, the head of small car programs, and Jim Queen, head of engineering and a member of the strategy board as well as then GM chairman Richard Wagoner’s inner circle.
Claybrook and Ditlow demanded in their letter that Barra name names and fix the blame for both creating the problems and for covering it up half a decade when the fatal and expensive consequences were coming into focus.
“In the fall of 2001, General Motors made a fatal design decision that condemned untold numbers of consumers to death and serious injury,” the letter from the tow long-time GM critics said.
The letter also noted the documents GM has made public show that GM engineers were well aware of the problem with the ignition switch. GM has now recalled some 2.6 million small cars and told analysts to expect a $1.3 billion charge on the company’s first quarter financial statement.
“Since they were submitted to Congress before you testified, surely your engineering staff should have told you about the shocking contents of these documents. They paint a tragic picture of the cost culture and cover up at General Motors. The conclusion we draw from examining the two different designs of the ignition switches under consideration in 2001 is that General Motors picked a smaller and cheaper ignition switch that cost consumers their lives and saved General Motors money,” the letter said.
“The documents show that when General Motors changed the ignition switch in 2006, it did not have to develop a new more robust design because GM engineers had already designed the safer switch that GM previously rejected in 2001. We call on you to publicly and openly produce all documents relevant to the decision-making on the selection of the lethal short detent spring and plunger switch in 2001 including documents showing the costs of the two switches.
“Who inside GM made these decisions and at what level?” the letter asked.
The letter also stated “given these startling revelations that a safer switch existed in 2001 before the Saturn and Cobalt were put into production, we call on you to make the full ‘unvarnished’ internal investigation of Anton Valukas public as he must surely probe these areas.”
Barra said in New York this week that it will take Valukas another 45 to 60 days to finish the investigation and report.
(Alfa quiet about big news in the Big Apple. For more, Click Here.)
Meanwhile, GM is moving to federal bankruptcy law to block claims, arising before the automaker went through bankruptcy in 2009. Under the terms of the bankruptcy decree, claims arising before 2009 now are now the responsibility of the “old” GM.
Lawyers for plaintiffs suing GM – and the number grows by the day – could argue GM’s willful negligence has canceled the bankruptcy court bar to recovery.
(Click Here to check out the array of new models from BMW.)
“GM chose to use the ignition switch that would fail as your customers were driving innocently on the highway. One design was the short detent spring and plunger that allowed the ignition key to move easily from the “run” position to the “accessory” position with the vehicle in motion and cut off the engine, power steering, power brakes and airbag, creating an unreasonable risk to safety. The other was the long detent spring and plunger with greater torque that made it much harder to move the ignition key from the “run” position to the “accessory” position,” Ditlow and Claybrook noted in their letter.
“The rejected long detent spring and plunger design became the silent remedy GM subsequently introduced into production in late 2006 without changing the part number, thus secretly fixing the models made after that date. But General Motors also did not recall the earlier models that it already knew were failing on the highway, causing death and injury as it was obligated to do under law, Ditlow and Claybrook said.
(To see the Mercedes S63 AMG Coupe Don Draper’s lusting after, Click Here.)
In addition, in conversations with and submissions to the National Highway Traffic Safety Administration beginning in 2004, GM never revealed its knowledge of the two different designs, the letter said.
By 2006, when the second switch decision was made, GM was already in serious financial trouble and Wagoner and other GM executives were deep into discussions with a consortium of private investigators, led by Cerberus, to sell off 51% of its cherished financial arm, General Motors Acceptance Corp.
GMAC ultimately also had to be bailed out by the federal government, which still holds a substantial stake in the Detroit-based financial services company.
