Reuters has confirmed that the engineers are Ray DeGiorgio and Gary
Also on Thursday, GM said it will take a higher-than-expected charge
of $1.3 billion in the first quarter, primarily to cover the cost of
recall-related repairs and courtesy transportation, compared with
the previously announced $750-million charge.
The automaker said U.S. dealers, in addition to replacing ignition
switches on the recalled cars, will replace ignition lock cylinders
because ignition keys can be removed while the engine is running.
The issue could cause a vehicle to roll away and crash.
GM said it is aware of "several hundred complaints" of keys coming
out of ignitions on the recalled cars, and at least one rollaway
incident and crash that caused one injury, but no reported
The recalled cars include the Chevrolet Cobalt and Saturn Ion, and
span model years 2003-2011.
DeGiorgio designed the original switch for the 2003 Saturn Ion that
went into production in August 2002. Versions of that switch were
used in other GM models, including the Chevrolet Cobalt, that are
also part of the global recall.
GM Chief Executive Officer Mary Barra, testifying last week before
Congress, was challenged by Democratic Senator Claire McCaskill, who
said "a culture of cover-up" caused DeGiorgio to deliver untruthful
testimony about his knowledge of the defective ignition switch
during his deposition last year for a lawsuit related to a fatal
2010 crash in Georgia.
DeGiorgio said then that the Ion/Cobalt switch was "one of my first
ignition switches." The defective switch was redesigned in 2006,
according to GM. DeGiorgio denied in his deposition that he knew of
the change, but U.S. congressional investigators produced an
internal GM document showing DeGiorgio had signed off on the change
in April 2006.
"He lied" about his knowledge of the defective part, McCaskill said.
Barra said she had seen indications of that as well, but she wanted
to let the company probe run its course over the next two months.
Repeated attempts by Reuters to contact DeGiorgio have been
Altman was the program engineering manager on the Ion and Cobalt. In
a deposition in the same 2013 lawsuit, Altman was asked by the
plaintiffs' attorney whether GM had made a business decision in 2005
not to fix the switch. He replied, "That is what happened, yes."
Altman did not return a phone call Thursday seeking his comment.
[to top of second column]
On Thursday, Barra said the engineers were placed on leave after she
was briefed by Anton Valukas, who is heading GM's internal
investigation. Valukas is the chairman of Jenner & Block. GM has
worked with Jenner & Block since 2002, and at least two of the
automaker's former top attorneys, Robert Osborne and Elmer Johnson,
were partners at the Chicago law firm.
"This is an interim step as we seek the truth about what
happened," Barra said in a statement. (http://r.reuters.com/zan48v)
Some members of Congress have expressed interest in calling GM
engineers, including DeGiorgio, to testify at hearings that will
likely come this spring or summer.
"There are still many unanswered questions about who else was
involved and the extent of the breakdown," House Energy and Commerce
Committee Chairman Fred Upton and Oversight and Investigations
Subcommittee Chairman Tim Murphy said in a joint statement.
"Ms. Barra testified that she did not have knowledge of the issue,
but just how far up the chain did the communications go? What did
they know and when did they know it?" added Upton, a Michigan
Republican and Murphy, a Pennsylvania Republican.
The faulty ignition switch can be bumped from the "RUN" position to
"ACCESSORY," which can cause the engine to turn off suddenly,
disabling the air bags and making steering and braking more
The National Highway Traffic Safety Administration is fining GM
$7,000 a day for missing an April 3 deadline to provide information
about the recall.
The regulator said on Tuesday that the automaker had not responded
to over a third of its questions by the deadline.
GM shares were up slightly at $33.72 in mid-afternoon on the New
York Stock Exchange. The stock has fallen about 17 percent so far
(Reporting by Paul Lienert in Detroit, Sagarika Jaisinghani in
Bangalore and Richard Cowan in Washington; editing by Kirti Pandey
and David Gregorio)
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