Bloomberg News

Cobalt Recall Won’t Harm GM’s Reputation, Barra Tells Employees

March 04, 2014

General Motors Co. (GM:US) Chief Executive Officer Mary Barra told employees the recall of 1.6 million cars over an ignition-switch defect linked to 13 deaths in crashes won’t harm the company’s reputation.

GM, the largest U.S. automaker, “has acted without hesitation” to address the recall in the past few weeks, Barra said in a note today on a website for employees of the Detroit-based company. “We have much more work ahead of us.”

Barra said she’s leading a group of senior executives monitoring progress on the recall. GM has also started an internal probe to provide an “unvarnished report on what happened,” she said.

U.S. regulators are investigating why it took GM years to recall the eight affected models, including 2005-2007 versions of the Chevrolet Cobalt, after learning about defects related to the ignition switch.

The company said key rings that are too heavy or jarring can cause the switches to slip out of the run position, causing the engines to shut off and a crash-sensing algorithm to misfire in a way that deactivates air bags.

“The vehicles we make today are the best in memory and I’m confident that they will do fine, on their own merits,” Barra said. “Our company’s reputation won’t be determined by the recall itself, but by how we address the problem going forward.”

To contact the reporter on this story: Jeff Plungis in Washington at jplungis@bloomberg.net

To contact the editors responsible for this story: Bernard Kohn at bkohn2@bloomberg.net Romaine Bostick


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