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Mon March 17, 2014
Mary Barra finds herself navigating a crisis at General Motors
During the long and agonizing Watergate scandal, the endless question was: What did he know, and when did he know it? That referred to President Richard Nixon, and the break-in and cover-up at the Democratic National Headquarters.
In the end, it turned out Nixon had known a lot, right from the start, which is how he became our only President ever forced from office.
Well, now people are beginning to ask: What did she know and when did she know it? Except the arena is not politics, but the auto industry, specifically, the reborn General Motors.
This time, the chief executive is a woman, Mary Barra, the first woman ever to lead a major car company.
Three months ago, many of us were stunned and delighted when she was appointed.
General Motors had been the most insular, and male- dominated company in an industry famous for its narrow outlook.
Barra seemed to have everything going for her. She was an engineer who genuinely loved the cars themselves and understood how they were created. She had done everything from working on the factory floor to running a plant. She took over a company that had emerged from near-extinction, and which was again making billions.
Yet, I had one nagging doubt.
Mary Barra has never worked anywhere else in her life. She worked for GM since she was a teenager. In the past, other executives with that background have suffered from tunnel vision. Many thought that was a big part of what went wrong at what once was the world’s biggest company.
I thought it would be years before we really knew if she would be limited by her life of total immersion in GM. But now General Motors faces a crisis that threatens to overwhelm Barra’s career before it really gets started.
Last month, GM announced it was recalling 1.6 million vehicles that may have faulty ignition switches that cause cars to stall and airbags not to deploy. The automaker admits they may have played a role in a dozen deaths. But an independent company that studies highway safety data, says the real figure is 303 deaths in faulty airbag crashes related to just two of the recalled models.
And it is now clear that General Motors knew about this problem for more than 10 years. The company says there wasn’t enough evidence to order a recall until last month.
Indications are that whatever reports were coming in to GM were bogged down in the automaker’s Byzantine committees.
Barra has now hired a former federal prosecutor to conduct an internal review, but in Washington, which spent billions to save General Motors, there are indications of hearings by both houses of Congress and a potential criminal investigation.
So far, Barra has been mostly silent. GM says she only learned of the problem a few weeks ago, which, if true, says something disturbing about the way that company still works.
There’s something to be said for not speaking until you have the facts. But sooner rather than later, Barra is going to have to publicly address both the problem and the culture that kept it hidden.
For her career may be at stake, and so could the future of an automaker which the public was finally beginning to trust again.