Agency cites record of smaller steps before recalls ultimately were issued

'Slow to act' GM rankled NHTSA, e-mail shows

Agency cites record of smaller steps before recalls ultimately were issued

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In late 2012, a routine service bulletin that General Motors sent to Buick and Chevrolet dealerships caught the attention of National Highway Traffic Safety Administration officials.

The bulletin referenced the potential for a component inside the driver's airbag to be damaged, which NHTSA later said could keep the airbag from operating properly. Yet GM's approach kept the problem largely hidden from customers.

Discussions between the agency and the automaker went back and forth for months, and GM eventually sent out two batches of recall notices to owners of about 7,000 cars. But NHTSA believed GM hadn't gone far enough and opened an investigation last summer to determine whether the recall should include 400,000 vehicles instead.

'Fairly obvious'


"This was particularly frustrating," Frank Borris, director of NHTSA's Office of Defects Investigation, wrote in a July 2013 e-mail to Carmen Benavides, the GM official who oversees safety investigations. The flaw was, Borris continued, "a (fairly obvious) safety issue."

The e-mail, released by a U.S. House committee investigating GM's ignition-switch recall, points to the sort of practices that have helped land the company at the center of a mushrooming crisis. When GM first addressed reports of cars stalling and ignitions slipping into "accessory" mode, it did so not with a recall but with an unpublicized service bulletin blaming heavy key rings and instructing dealers to offer plastic key inserts to customers who complain.

Toyota Motor Sales U.S.A. used a similar strategy in 2002, when it sent dealers a bulletin about "engine surging" in some of its models, including the Camry. Toyota later paid record fines to NHTSA and agreed to a $1.2 billion settlement with the Justice Department after waiting seven more years to begin issuing recalls for sticking accelerators pedals and ill-fitting floor mats.

NHTSA's concerns about GM related to defects discovered in the years after Toyota came under fire suggest that even the post-bankruptcy "new GM" may not have taken its rival's troubles to heart as much as regulators hoped other automakers would.

It took nine more years and at least 11 more fatalities after GM first issued the "inadvertent turning of key cylinder" bulletin before the company turned the ignition-switch issue into a recall and notified customers directly. In that time, fewer than 500 customers were given key inserts.

A GM spokesman declined this past week to discuss the NHTSA e-mail or the issues raised in it.

Little-noticed technical service bulletins are one of several tactics that safety advocates say many automakers -- not just GM -- use to avoid costly recalls.

"I have a hard time seeing GM as a big standout," said Sean Kane, president of Safety Research & Strategies in Rehoboth, Mass. "All of them play the same games."

But NHTSA was especially irritated with GM last year, according to the e-mail from Borris. He listed four other instances from 2011 through 2013 for which the agency felt GM improperly used service bulletins, regional recalls, warranty extensions or customer-satisfaction campaigns.

In each case, he said, NHTSA ultimately pushed GM to treat the matter more urgently. Two of the cases Borris cited resulted in NHTSA opening recall queries that remain unresolved. Two cases involved airbags that might not deploy in a crash, which also is a consequence of the ignition-switch defect in the Chevrolet Cobalt and Saturn Ion.

Winding road to recall
In an e-mail to GM last year, a National Highway Traffic Safety Administration official expressed concern that GM improperly used service bulletins, regional recalls, warranty extensions or customer-satisfaction campaigns to address safety issues.

2011


Problem: Corrosion in fuel filler pipes on full-sized vans
GM's initial response: Warranty extension
After NHTSA's involvement: Regional recall of 9,389 vehicles

2012


Problem: Malfunctioning airbag modules on Chevrolet Malibu
GM's initial response: Customer-satisfaction program
After NHTSA's involvement: Recall of 4,304 vehicles

2012


Problem: Fire risk in door modules on full-sized SUVs
GM's initial response: Regional recall of 278,174 vehicles in 20 salt-belt states, customer-satisfaction program elsewhere
After NHTSA's involvement: National recall of 471,826 vehicles

2013


Problem: Damaged component that could prevent proper airbag operation in Buick Verano and Chevrolet Camaro, Cruze and Sonic
GM's initial response: Technical service bulletin
After NHTSA's involvement: Recall of 6,845 vehicles; NHTSA recall query remains open

2013


Problem: Loss of battery charge in eAssist system on Buick LaCrosse and Regal and Chevrolet Malibu Eco
GM's initial response: Technical service bulletin
After NHTSA's involvement: Recall of 42,904 vehicles; NHTSA recall query remains open

Source: NHTSA

'One of ... the worst'


"The general perception is that GM is slow to communicate, slow to act and, at times, requires additional effort of [the Office of Defects Investigation] that we do not feel is necessary with some of your peers," Borris wrote. He later added that GM was "one of, if not the worst offender of the regional recall policy," in which automakers recall vehicles only in certain parts of the country, such as northern states where roads in winter frequently are treated with salt, which speeds corrosion.

NHTSA concluded that GM was wrong to use a regional recall covering the "salt-belt states" in 2012 to address a fire risk in the Chevrolet TrailBlazer and similar full-sized SUVs. GM later expanded the recall nationally.

In one case, related to corrosion of fuel filler pipes in full-sized vans, GM first offered warranty extensions, then upgraded the matter to a regional recall after NHTSA got involved.

With the ignition-switch defect, documents show that NHTSA officials twice questioned whether a service bulletin was sufficient. Both times, they were overruled by others in the agency, and a formal investigation of the issue never was opened.

The two engineers whom GM put on paid leave this month as it conducts an internal inquiry of the matter each said in depositions last year that no recall ever was considered at the time the bulletin was issued.

You can reach Nick Bunkley at nbunkley@crain.com. -- Follow Nick on Twitter

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