What the report says about the role, knowledge of GM's top executives, board

Alicia Boler-Davis, GM's senior vice president of global quality and customer experience, did not share with CEO Mary Barra any information about the Cobalt issue until Jan. 31, 2014.
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NEW YORK -- Before the faulty ignition switches in the Chevrolet Cobalt came to light, General Motors CEO Mary Barra believed the company handled recalls effectively and with urgency, according a report issued Thursday about GM’s handling of the recall.

As senior vice president of global product development, Barra became “well acquainted” with GM’s recall process in 2011 amid scrutiny over risks that the lithium ion battery packs in Chevrolet Volts may catch fire after a crash, according to the 315-page report on GM by former federal prosecutor Anton Valukas.

GM eventually recalled 8,000 Volts in early 2012 to prevent battery fires, and that experience led Barra to believe that recall issues at GM “were addressed with appropriate urgency and that the recall decision-making process worked well,” the report said.

Yet information about the defective ignition switches linked to 13 deaths was never presented to Barra, other top GM executives, or the company’s board of directors before last December. The Valukas report goes into great detail about the roles played by senior GM executives, and the company’s board, in the years leading up to the ignition switch recalls. Here are summarized excerpts from the report:

Mary Barra

Barra first learned about “some aspect” of the Cobalt’s ignition switch issues last December, when John Calabrese, GM’s global vehicle engineering boss, told Barra that the company was reviewing data that may lead to a recall of the Cobalt.

Barra learned nothing more about the issue until after the GM group responsible for making recall decisions, the Executive Field Action Decision Committee, decided to issue the ignition switch recall on January 31, according to the Valukas report.

The report reviewed e-mails between Barra and other GM executives through December 2013, finding four that raised issues about the Cobalt or vehicles stalling while being driven, but none that mentioned faulty ignition switches, according to the report.

One such e-mail reviewed by Valukas was a 2012 message to Barra from a former GM employee who reported a “freak/isolated” incident: the unexpected stalling of his Buick.

Barra forwarded that e-mail to Terry Woychowski, then-vice president of global quality, for further study. Woychowski subsequently forwarded the email to others within GM before the e-mail chain eventually involved eight people inside the company, except for Barra, who had been dropped from the chain.

In the subsequent e-mails, the stalling of early Cobalt models and subsequent design changes to the key ring was mentioned, but Barra had already been removed from the e-mail chain by that time.

“None of these emails is evidence that Barra was informed about the Cobalt ignition switch issues before Calabrese alerted her in December to the analysis that was being undertaken on that subject,” the report said.

Mark Reuss

Reuss did not have engineering responsibility for the Cobalt in any of the positions he has held since joining GM in 1986, the report said.

From 2009 through 2013, Reuss was president of General Motors North America. In that role, Reuss typically learned of recalls after decisions were made by the Executive Field Action Decision Committee responsible for issuing recalls. After succeeding Barra as GM’s global product development boss, he learned of the Cobalt recall after the recall committee decided to issue the recall last January.

“None of the documents we reviewed or interviews we conducted identified any evidence that is inconsistent with Reuss’ recollection,” the report said.

Alicia Boler-Davis, senior vice president of global quality and customer experience

One e-mail about the Cobalt, its ignition switch and airbags that failed to deploy never reached Barra. It started when Maureen Foley-Gardner, director of field performance evaluation, e-mailed GM global quality boss Alicia Boler-Davis about a likely field action for the Cobalt involving the ignition switch and airbags that failed to deploy.

According to the report, Boler-Davis replied on Nov. 19, 2013, asking Foley-Gardner for a summary, which Boler-Davis said she would then share with Barra.

Barra was not copied on that email, the report said, and Boler-Davis did not share with Barra any information about the Cobalt issue until Jan. 31 of this year.

Rick Wagoner

According to the report, then-CEO Rick Wagoner “may” have viewed a 72-slide presentation in March 2009 that included one “back-up” slide referencing the Cobalt’s inadvertent engine shutoff issue. The slide in question, which also described the subsequent change of the Cobalt’s key ring design from a slot to a hole, was “solely focused on warranty cost reduction and did not characterize the matter as a safety issue or mention airbag non-deployment, accidents or fatalities,” the report said.

Wagoner, the report said, does not recall reviewing any of the slides.

Investigators with Jenner and Block found the slide presentation on Wagoner’s computer, and conducted an “extreme” investigation of the presentation’s origin and meetings where it was discussed to find out whether Wagoner was told of the change to the key ring or of the “unmentioned safety implications.”

The slides were used in one of the five presentations in a March 5, 2009, meeting of GM’s Vehicle Program Review team, which met almost every week. Wagoner did not typically attend those meetings, including the one on March, 5, 2009, the report said. Instead, Wagoner and more than 20 executives relied on e-mailed summaries of each week’s meeting.

The slides were found in a temporary folder labeled with a generic name on Wagoner’s computer, the report said, and Wagoner told the investigators he did not recall viewing the slides.

Roughly three weeks after the March 5, 2009 Vehicle Program Review meeting, Wagoner was asked to resign as GM’s CEO by the U.S. government’s auto task force.

Board of Directors

While the full GM board and board committees reviewed safety-related issues, no committee had total responsibility for reviewing all safety issues.

Instead, safety matters were brought up in piecemeal slices, either before the full board or before certain committees. And except for a few rare cases, the board rarely reviewed specific safety issues affecting individual vehicles.

Several GM directors and executives who made presentations to the board on a regular basis from 2003 through early 2014 were interviewed for the Valukas report.

The full board heard reports about vehicle quality, warranty costs, aggregate recall data with comparisons to competitors and costs related to “field actions” which include recalls. Written updates about legal issues including product liability suits were also provided to board members “in connection with every meeting,” according to the Valukas report.

Despite those reports, and other areas where the board has safety oversight, the Cobalt ignition switch problems never surfaced, the report found.

“The slow pace of the Cobalt investigation and the emerging pattern of accidents potentially related to the safety defect were not escalated to the company’s most senior executives who from time to time met with the board,” the report said. “The board of directors was not informed of any problem posed by the Cobalt ignition switch until February 2014.”

You can reach Ryan Beene at rbeene@crain.com. -- Follow Ryan on Twitter

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