DETROIT: In response to former US Attorney Anton Valukas’ probe into General Motors’ decade-long delay in recalling Chevrolet Cobalts with defective ignition switches, GM CEO Mary Barra emphasized Thursday morning that the company must "face up and learn from it."
"As I prepared for today, I thought long and hard about the very tough message I would be delivering," she said at a global town hall meeting on Thursday morning. "I knew full well how difficult this experience would be for all of us. But I also knew the only course was to be direct and totally honest."
The Wall Street Journal gave readers a sneak peek at Valukas’ inquiry on Wednesday night, reporting that it was expected to conclude there was "no concerted cover-up, but that managers operating in isolation failed to make connections and act on evidence of problems now linked to fatal accidents," referring to the 13 deaths blamed on the glitch.
Although Valukas blamed GM’s internal culture, his report spared Barra, its board, and former CEO Dan Akerson of most of the blame, stating that they did not know about the defect until December of last year.
Valukas’ report was described as "extremely thorough, brutally tough, and deeply troubling," by Barra, in her statement.
Some points discussed in the report include how GM personnel’s inability to address the ignition-switch problem "represents a history of failures," and how no one took responsibility or demonstrated a sense of urgency to fix the issue. Employees also did not raise the problem to the highest levels of the company, even though engineers, investigators, and lawyers knew about it for years, according to the report.
"Overall, the report concludes that from start to finish, the Cobalt saga was riddled with failures, which led to tragic results for many," said Barra.
In response to the report, Barra said GM has axed 15 staffers who were "determined to have acted inappropriately," in conjunction with the crisis. Disciplinary actions were taken against five additional employees. The company is also implementing a compensation program for victims.
Barra expressed to GM staffers that the company’s internal culture and behavior must also change, encouraging them to speak up if they believe a problem is not being handled properly, and even contact her directly, if necessary.
"I want an environment at GM where the customer is at the center of every action and every decision," she said. "After all, we exist to serve their needs, not the other way around. We jointly own our successes and our failures. We have to hold each other accountable."
Barra added that GM is redoubling efforts to meet all recommendations, and expects them to be completed by the end of the second quarter, adding that there will be more recall announcements in the near term.
GM filled its top communications position last month when it brought back Tony Cervone as SVP of global communications. Its top PR job had been vacant since Selim Bingol left the company in mid-April. Earlier that month, it retained crisis communications expert Jeff Eller and Washington-based lawyer Kenneth Feinberg to support it during the crisis.
Barra's performance received mixed reviews this morning on Twitter.
Lots of platitudes, few specifics at GM press conference on ignition switch failure. Mary Barra refuses to identify fired GM executives— Rachel C. Abrams (@RachelAbramsNY) June 5, 2014
Engineers in lawsuits testified cost was a factor, but Valukas report found no trade off between cost and safety. Conflict? #GM— Guy Gordon (@newsGuy4) June 5, 2014
Mark Reuss, Barra and CFO Ammann are now involved directly in recall decisions. Before Februrary they weren't. #GMRecall— Greg Gardner (@GregGardner12) June 5, 2014
Nice leadership speech by GM CEO Marry Barra this am. This problem is all about culture and must be her total focus.— Jack Welch (@jack_welch) June 5, 2014