In a letter to employees on Tuesday, Barra, who took over in January
as the automotive industry's first female chief executive, said the
recall would "take time to play out" and GM would cooperate with all
the parties involved. She said customer safety and satisfaction
would be at the heart of every decision made.
Those groups include U.S. safety regulators at the National Highway
Traffic Safety Administration, which last week opened an
investigation into whether the Detroit company reacted fast enough
in its recall of more than 1.6 million cars.
GM employees can expect "additional developments in the near term"
related to the recall, Barra said in the letter posted on GM
Fastlane, the company's electronic news magazine. She did not
provide more details but reiterated that the company had launched an
internal review "to give us an unvarnished report on what happened."
"We will hold ourselves accountable and improve our processes so our
customers do not experience this again," she said.
"While I deeply regret the circumstances that brought us to this
point, I appreciate how today's GM has responded so far," Barra
For any employees wondering how the recall would affect GM's
reputation or sales, Barra said that was not the issue. "Our
company's reputation won't be determined by the recall itself, but
by how we address the problem going forward," she said.
Other actions taken by GM include the creation of a group of senior
executives led by Barra to direct the company's response, monitor
progress and make adjustments as needed; working with dealers to
ensure customer satisfaction; coordinating the rollout of
replacement parts with the supplier; and keeping federal regulators
informed, Barra said.
GM, which went through a bankruptcy restructuring in 2009, could
face a maximum fine of $35 million if it failed to notify NHTSA
within five days of a recall after learning of a vehicle safety
The company did not say how much the recall would cost. Analysts
have said the biggest cost could result from the flurry of lawsuits
likely to be triggered by the defect and the company's actions.
[to top of second column]
GM's recall was to correct a condition that may allow the engine and
other components, including front airbags, to be unintentionally
GM previously said the weight on the key ring, road conditions or
some other jarring event may cause the ignition switch to move out
of the "run" position, turning off the engine and most of the car's
electrical components. GM has recommended that owners use only the
ignition key with nothing else on the key ring.
The company said last week that the initial replacement parts will
be available in early April.
Last month, GM said it was recalling 778,562 Chevrolet Cobalt and
Pontiac G5 compact cars from model years 2005 through 2007. Last
week, it added 842,103 Saturn Ion compact cars from 2003 through
2007 model years, Chevy HHR midsized vehicles from 2006 and 2007,
and the Pontiac Solstice and Saturn Sky sports cars from 2006 and
Of the cars recalled, 1,367,146 vehicles are in the United States,
235,855 are in Canada, 15,073 are in Mexico and 2,591 were exported
outside North America, according to GM.
GM no longer makes any of the affected models.
GM's shares were up 65 cents, or 1.8 percent, at $36.86 in late
trading on the New York Stock Exchange.
(Editing by Jonathan Oatis)
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