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 After taking an oath at a House of Representatives panel, Barra
kicked off the contentious hearing by declaring, "I am deeply sorry"
for the company's failure to respond quickly to the safety problem
and subsequent deaths.
The questioning became contentious at times but it did not appear to
rattle the GM chief executive, who rose to her current job in
January. However, she repeatedly did not provide the answers House
Energy and Commerce panel lawmakers were seeking, citing the
company's ongoing internal investigation.
Still, during a nearly three-hour appearance on Capitol Hill, Barra
testified again and again that GM had taken steps to prevent future
safety problems from occurring. She labored to remind lawmakers that
the so-called "new GM" she heads was nothing like the "old GM" that
failed to deal with faulty ignition switches for more than a decade.
Barra was called to testify as part of congressional probes into
GM's delayed recall of 2.6 million vehicles that could have faulty
ignition switches that unexpectedly cause engines to stall and
prevent air bags from deploying and power brakes and power steering
systems to operate normally.
Barra also announced the company had hired a well-known consultant,
Kenneth Feinberg, to examine what steps, if any, GM might take for
families of crash victims. Safety advocates said the move indicated
the company was exploring setting up a victims' compensation fund.
For all the claims of GM having a new culture, however, Barra and
the three executives seated behind her in the hearing room have
notched more than 120 years of combined employment with the
automaker.
Asked whether GM previously had a culture that would have put cost
considerations over safety, Barra responded, "We are doing a
complete investigation but I would say in general we have moved from
a cost culture, after the bankruptcy, to a customer culture. We have
trained thousands of people in putting the customer first."
GM emerged from bankruptcy in 2009 with the help of a $49.5 billion
U.S. taxpayer bailout.
Representative Henry Waxman, a veteran Democrat who has spearheaded
past attempts to tighten U.S. laws on automotive safety, bluntly
told Barra: "Because GM didn't implement this simple fix when it
learned about the problem, at least a dozen people have died in
defective GM vehicles."
Barra is scheduled to testify on Wednesday to a Senate panel, which
also is investigating her company's handling of the defective
ignition switches. The company also faces a criminal probe by the
U.S. Department of Justice.
GM first learned of a problem with its ignition switches on
Chevrolet Cobalts, Saturn Ions and other models in 2001, documents
have shown, but took no steps to recall any cars until this past
February.
Lawmakers are investigating why GM and regulators missed or ignored
numerous red flags that faulty ignition switches could unexpectedly
turn off engines during operation and leave airbags, power steering
and power brakes inoperable.
David Friedman, acting administrator of the National Highway Traffic
Safety Administration, tried to fend off suggestions that the agency
failed to spot the problem, saying, "I wish these crashes were as
simple as they seem to be."
Instead, Friedman said GM failed early on to share links it had
established between the ignition switch problem and the
non-deployment of air bags during crashes.
"HORRIFIC STORIES" Families of victims killed in crashes involving GM cars held an
emotional meeting with Barra in the company's Washington offices on
Monday night.
The drama inside the packed hearing room, named the "John D.
Dingell" room after the Michigan Democrat with a long history of
advocating for GM, was heightened by more than 10 photographs of
accident victims displayed against one of the walls. Some victims
were from home states of members of Congress serving on the
committee holding Tuesday's hearing.
Many family members have tried, unsuccessfully, to convince Barra to
urge consumers to park all recalled cars and avoid driving them
until repairs are made.
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Laura Christian, whose daughter Amber Rose was killed in a 2005
Chevy Cobalt in Maryland, said in an interview after the meeting,
"Everybody was crying the entire time" during the meeting. "There
were horrific stories." Barra reiterated during her testimony that
it was safe to continue driving the recalled cars as long as no keys
or other items are attached to the lone key inserted into the
ignition.
GM's shares closed down 8 cents at $34.34 on the New York Stock
Exchange on Tuesday.
On Monday the company said March sales rose 4 percent from a year
ago, beating analysts' predictions of a 0.5 percent increase.
Industry analysts and some GM dealers, however, raised concerns that
all the publicity about recalls could begin eroding sales in April.
Republicans and Democrats on the panel, who usually are at odds on
most issues, were united in aggressively challenging Barra and GM's
performance.
House Energy and Commerce Committee Chairman Fred Upton, a
Republican, told Barra: "With a two-ton piece of high-velocity
machinery, there is zero margin for error; product safety is a life
or death issue. But sadly, vehicle safety has fallen short."
Barra calmly reiterated that the issue of defective ignition
switches only came to her attention on January 31.
She had few answers for lawmakers wanting to know who made the
decision to quietly revise the design of the faulty switch in 2006,
and why GM did not take more seriously dozens of reports of keys
unintentionally moving to the "off" position, sometimes at high
speeds.
Barra said she will learn more from an internal probe led by Anton
"Tony" Valukas, who chairs the law firm Jenner & Block.
"We will learn from this and we will make changes and we will hold
people accountable," she said.
Under intense grilling by lawmakers, Barra said she found employee
statements "disturbing" that cost considerations may have
discouraged the prompt replacement of faulty ignition switches
linked to recall of 2.6 million vehicles.
"I find that statement to be very disturbing. As we do this
investigation and understand it in the context of the whole timeline — if that was the reason the decision was made, that is
unacceptable. That is not the way we do business in today's GM."
On one of the most sensitive issues in the congressional
investigation of GM, lawmakers asked Barra why the company would
have included ignition switches in its cars even though they did not
fully meet the company's specifications, as revealed in documents
handed over to lawmakers this week.
"There is a difference between a part not meeting specifications and
it being defective," Barra responded.
Pressed on whether the switch was acceptable from a safety and
functionality perspective, Barra said: "As we clearly know today, it
is not."
(Additional reporting by Julia Edwards; writing by Richard Cowan;
editing by Karey Van Hall, Tom Brown, G. Crosse and Richard Chang)
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