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General Motors

General Motors

General Motors' sales rose 1% in June - despite two fewer sales days in the month, despite a delayed recall scandal, and despite the company issuing a record number of recalls.

The Detroit automaker's sales were the best for June since 2007.

Karl Brauer is an analyst with Kelly Blue Book. 

He says the media and Congress have displayed an intense interest in GM's admission that it delayed an ignition switch recall for eleven years. 

Customers aren't paying as much attention.   

"Most people look at this recall as old GM and old models that has nothing to do with what's in the showroom right now," says Brauer.

General Motors has found another problem with ignition switches in vehicles.

In what's sure to become extra ammunition in Wednesday's Senate committee interrogation of GM Chief Executive Officer Mary Barra, the automaker this week is recalling 3.16 million mostly older model vehicles to replace slotted keys with keys with a hole.

The company says the fix will prevent the cars from inadvertently turning off if there is extra weight on the key ring and the car goes over a bump.

The cars involved in the recall:

Sarah Cwiek / Michigan Radio

GM shareholders meet today at the automaker’s Detroit headquarters—with protesters circling outside the Renaissance Center.

The protesters include family members of people who died in GM cars that have since been recalled.

GM has acknowledged 13 deaths as a result of faulty ignition switches. But victim’s advocates say that number is much higher, possibly more than 100.

Laura Christian’s daughter, Amber Marie Rose, died when the airbag in her 2005 Chevy Cobalt failed to deploy.

Steve Carmody / Michigan Radio

Dozens of people are suing General Motors over its ignition switch problem.

Texas attorney Bob Hilliard represents about 70 families suing GM in a variety of state and federal courts.

He says his clients were “stunned” to hear GM CEO Mary Barra admit the problem was a result of "incompetence and neglect."

“I don’t think that GM can come into a court of law anymore and argue it wasn’t their fault,” says Hilliard.  He says the only thing GM can argue now is “what is the value of the loss.”

GM executives answer questions during this morning's press conference.
GM / YouTube

Update 3:30 p.m.

Texas attorney Bob Hilliard represents about 70 families suing GM in a variety of state and federal courts.  

He says his clients were “stunned” to hear GM CEO Mary Barra admit the problem was a result of "incompetence and neglect."

“I don’t think that GM can come into a court of law anymore and argue it wasn’t their fault,” says Hilliard. He says the only thing GM can argue now is “what is the value of the loss.”

But Hilliard says he does worry GM will claim it's not liable for problems predating its bankruptcy. He cites a case involving a Pennsylvania man who was paralyzed from the chest down in an accident.   

“In court they say GM did not design this vehicle. GM did not manufacture this vehicle. GM did not sell this vehicle. Even though this vehicle was a 2006 GM Cobalt,” says Hilliard.

Hilliard says he's "skeptical" about the victims’ compensation fund GM is offering to establish.

Update 10:34 a.m.

The much-anticipated report that looked into what went wrong at General Motors was given to federal regulators and Congress this morning.

GM executives held a press conference this morning about what the report found and how GM plans to respond.

This is a turning point in the ignition switch recall saga for GM.

CEO Mary Barra refused to answer detailed questions from the press and from Congress until Anton Valukis released the findings of his investigation.

The New York Times' Bill Vlasic writes that GM execs hope this report will relieve some pressure on the company:

Legal experts say that G.M. has taken a calculated risk that Mr. Valukas’s findings and recommendations will sufficiently answer the myriad questions hanging over the company.

“The downside is that members of Congress, the press and the public may think that the report lacks credibility if it is in an in-house investigation,” said Carl W. Tobias, a law professor at the University of Richmond.

But Professor Tobias said that Mr. Valukas, a former United States attorney, was a good choice for the delicate task of investigating G.M. “His reputation is on the line with this report, so he is not likely to sacrifice that for G.M.,” he said.

But this is just another step in the grand mea culpa for GM.

Vlasic reports the company faces more Congressional hearings, more investigations from the U.S. Justice Department and the Securities and Exchange Commission, and it will need to compensate the families of the victims of the ignition switch problems:

... the company is awaiting recommendations from the lawyer Kenneth R. Feinberg on how it will compensate victims of switch-related crashes and family members of people who died as a result of the defect. G.M. faces hundreds of private claims and lawsuits.

Mr. Feinberg, who oversaw compensation claims for victims of the 9/11 terrorist attacks and the Boston Marathon bombing, has said he would make his recommendations to G.M. later this month.

To see how this crisis unfolded for GM, check out this timeline from NPR's Tanya Basu.

9:48 a.m.

General Motors CEO Mary Barra says 15 employees have been fired over the company's recent ignition switch recalls.

Barra made the announcement this morning as she released an internal investigation by attorney Anton Valukis into the recall of 2.6 million older small cars for defective ignition switches.

Barra says the internal investigation into its recent ignition switch recall is "brutally tough and deeply troubling."

“What Valukis found in this situation was a pattern of incompetence and neglect,” Barra said. “Repeatedly, individuals failed to disclose critical pieces of information that could have fundamentally changed the lives of those impacted by the faulty ignition switch.”

It took GM more than a decade to report the switch failures, which it blames for 13 deaths.

In a town hall meeting at GM's suburban Detroit technical center, Barra says attorney Anton Valukas interviewed 230 employees and reviewed 41 million documents to produce the report, which makes recommendations to avoid future safety problems.

GM Renaissance Center in Detroit.
John F. Martin / Creative Commons

At 8 a.m. on June 1, 2009, General Motors filed for Chapter 11 reorganization. That filing in the bankruptcy court in Manhattan was the start of a painful and historic journey for General Motors. 

Five years later, after a massive government equity investment, General Motors is doing well, although it has been rocked recently by the ignition switch recall controversy, and a blizzard of other recalls. 

Let's take stock of what GM has done in the last five years, and see if the prevention of job and income losses was worth the cost to taxpayers. 

Sonari Glinton is NPR's business reporter, and he joined us on Stateside. 

*Listen to the full interview above. 

DETROIT – General Motors is recalling 2.4 million vehicles in the U.S. as part of a broader effort to resolve outstanding safety issues more quickly.

The latest action brings to 13.6 million the number of vehicles GM has recalled this year, a new record for the automaker.  

The recalls announced Tuesday include 1.3 million older-model crossovers with defective front seat belts and 1 million sedans with a shift cable that can wear out. 

GM is also recalling 1,400 new Cadillac Escalade SUVs with faulty air bags. No fatalities related to the defects have been reported, GM says. It expects to take a $400 million charge in the second quarter to repair the vehicles. 

GM agreed to a $35 million federal fine last week for delays in reporting a deadly ignition switch defect.

user: Vanillase / Wikimedia Commons

A recent Oxford University report estimates that robots could replace nearly half of the current U.S. workforce.

The report found that office administrators, sales personnel, and those in the service industry are among those at risk of losing their jobs to robots.

Robots have become common in many workplaces since General Motors installed the first robot at a plant in New Jersey in 1961 ("Unimate," as it was called, could weld and move parts that weighed up to 500 pounds).

So can humans keep up, or at least keep ahead of the technology that is changing the workforce?

These are especially important questions here in Michigan, with its historic ties to the auto industry that makes up about 40% of the global supply of industrial robots. 

Stephen Spurr, Chair of the Department of Economics and professor at Wayne State University, joined us today to explore the possibilities (You can listen to our interview with Spurr above.)

US Supreme Court

This Week in Michigan Politics, Jack Lessenberry and Christina Shockley discuss the U.S. Supreme Court decision on affirmative action, and the latest reactions by GM after the fallout from recalls for ignition switch problems.

GM Renaissance Center in Detroit.
John F. Martin / Creative Commons

DETROIT – General Motors is adding 35 product safety investigators as part of a larger restructuring in response to a series of safety recalls.

GM says the new investigators will more than double the size of its current team, to 55.

The company is also dividing its global vehicle engineering organization into two sections. A product integrity section will oversee vehicle and engine engineering as well as safety, while a separate department will oversee parts engineering and advanced vehicle development.

GM's product development chief Mark Reuss says the changes were made to ensure that potential problems are spotted and handled more quickly.

The government is investigating why it took GM more than a decade to recall small cars with a defective ignition switch.

Documents detail another delayed GM recall

Apr 19, 2014
GM

DETROIT (AP) - Government documents show that General Motors waited years to recall nearly 335,000 Saturn Ions for power steering failures despite getting thousands of consumer complaints and warranty repair claims. Additionally, the National Highway Traffic Safety Administration didn't seek a recall of the 2004-2007 compact cars even though it opened an investigation more than two years ago.

An image from the consumer alert issued for the GM ignition switch recall.
NHTSA

DETROIT (AP) - A federal judge in Texas has denied an emergency motion that would have forced General Motors to tell owners of 2 million recalled cars to stop driving their vehicles until their ignition switches are repaired.

U.S. District Judge Nelva Gonzales Ramos issued her order Thursday in Corpus Christi. Attorney Robert Hilliard, who represents some owners, had argued that the GM cars could at any moment lose power and expose their occupants to serious injury or death.

GM had urged the court not to intervene and instead let a recall overseen by the National Highway Traffic Safety Administration proceed. The carmaker said extensive testing had shown that if the recall instructions were followed, there was no risk that the ignition switch would fail.

GM has linked the switch to 13 deaths.

GM Renaissance Center in Detroit.
John F. Martin / Creative Commons

General Motors is asking a bankruptcy judge in New York to take a look at its "shield" – the shield that protects it from liability lawsuits that stem from crashes or defects that happened before its bankruptcy.

Veteran auto analyst Michelle Krebs joined us today. She explained what GM is trying to find out. *Listen to the audio above.

Flickr user afagen / Flickr

As we get together with our families to celebrate the holidays, we often think about those who are no longer with us. For many, a trip to a cemetery to visit loved ones is easy, but for others, it’s impossible.

For families with relatives buried in the Beth Olem cemetery in Detroit, they can’t go pay their respects.

The cemetery is hidden within GM’s Poletown plant, and is only open to the public two days every year: the Sunday before Passover and Rosh Hashanah.

People are able to visit the cemetery if they go on a private tour offered by the Michigan Jewish Historical Society. We heard from some of the visitors today.

Listen to the full interview above.

The week in review

Apr 12, 2014
Photo by penywise / morgueFile

This Week in Review, Rina Miller and Jack Lessenberry discuss the latest with the Detroit bankruptcy, the continuing controversies over the General Motors recall, and the money problems involving the charter school system running Muskegon Heights schools.


The massive GM recall just got more expensive

Apr 11, 2014

General Motors Thursday revised up to $1.3 billion dollars its estimate of the cost of recalling millions of cars with faulty ignition switches.

The automaker will now replace the ignition lock cylinder as well as the switch itself on the defective vehicles. The $1.3  billion estimate includes the cost of repairs and of providing loaner vehicles to customers.

GM shares fell to a 10-month low today in the wake of the news. Ratings agency Standard & Poor's said Thursday that it might put off a planned upgrade of GM's debt to investment-grade status until next year.

screen grab / U.S. House of Representatives

Two engineers have been put on paid leave at General Motors as the company has an outside attorney investigate why it took more than 10 years for GM to recall millions of cars with faulty ignition switches.

GM says the switches have been linked to at least 13 deaths.

More on the suspension of the engineers from the Associated Press:

The company says in a statement Thursday that the action was taken after a briefing from former U.S. Attorney Anton Valukas. He's been hired to figure out why GM was so slow to recall the cars.

2007 Cobalt, one of the recalled models
GM

A recall crisis at General Motors hasn't slowed sales of Cobalts, HHR's and other cars with a defective ignition switch.

In fact, the cars are selling for more than they did just a month or two ago.

Alec Gutierrez of Kelly Blue Book says used car prices go up in the spring.

"So, it's a matter of a rising tide lifting all boats," he says.

screen grab / U.S. House of Representatives

The new head of General Motors, Mary Barra, is on Capitol Hill today starting what will be two days of testimony.

She'll be questioned about a safety defect that's been linked to at least 13 deaths and has sparked a 2.6 million-vehicle recall.

At issue: What did GM know about the problems with ignition switches in its cars, and when did the company know it?

Watch it below:

The Long Road To GM's Ignition Switch Recall

Apr 1, 2014

The new head of General Motors, Mary Barra, goes to Capitol Hill Tuesday to begin two days of testimony.

It's the first time she'll be questioned about a safety defect that's been linked to at least 13 deaths and has sparked a 2.6 million-vehicle recall.

At issue for the Detroit CEO is a classic question: What did GM know about the problems with ignition switch problems in its cars, and when did the company know it?

And just as important for GM and government regulators is the follow-up question: Why did no one act sooner?

United Auto Workers membership grows slightly

Mar 29, 2014
UAW/Facebook

NEW YORK (AP) - A filing with the U.S. Department of Labor shows the United Auto Workers' membership grew by nearly 9,000 people last year. 

UAW's membership in 2013 was 391,415, compared to 382,513 in 2012. The union has been steadily adding members since 2009, when General Motors and Chrysler filed for bankruptcy.

Steve Carmody / Michigan Radio

DETROIT (AP) - General Motors is adding 824,000 small cars to its ongoing recall tied to defective ignition switches.

The company will add vehicles from the 2008-2011 model years to a recall that initially covered cars only through the 2007 model year.

The Chevrolet Cobalt, Chevrolet HHR, Pontiac G5, Pontiac Solstice, Saturn Ion and Saturn Sky are all involved in the recall.

GM says around 5,000 of the faulty switches were used for repairs on 2008-2011 model year cars. GM says it's expanding the recall to make sure it finds all the switches.

Next week will bring a big test for new GM CEO Mary Barra.

She will present herself to Congress for a two-day grilling over the ever-growing ignition switch crisis, a problem that GM says is linked to 12 deaths.

Detroit News business columnist Daniel Howes thinks Barra has a whole lot of heavy lifting to do to get this "new" GM out of the shadow of the missteps of the "old" GM. He joined us today for our weekly check-in.

Listen to the full interview above.

When you think "Michigan," you think tourism, right? Or, for some, maybe it's Tim Allen telling you about the state's open roads, fall colors, glistening lakes. Tourism means big business for the mitten. We look at how the changing climate might impact what more than 4.4 million out-of-state visitors will be able to do and enjoy when they come to the Great Lakes State. 

 Then, we spoke with Michigan author Laura Kasischke about her latest novel, Mind of Winter. And Daniel Howes joined us for our weekly check-in, to discuss Mary Barra and the ghost of GM's past. Also, women are underrepresented in the  STEM (science, technology, engineering and mathematics) fields, but there is one University of Michigan student group trying to change that. And, we are one week into spring but still getting snow. Meterologist Jim Maczko spoke with us about when we can expect warmer weather.  First on the show, we are closing in on the deadline to purchase health insurance or face a penalty under the Affordable Care Act. 

Erin Knott is the Michigan Director of Enroll America, a non-profit, non-partisan group trying to get people enrolled in health insurance.

Erin joined us today to discuss the upcoming deadline. 

GM Renaissance Center in Detroit.
John F. Martin / Creative Commons

General Motors has been in the headlines recently over its recall of more than 1.5 million vehicles due to ignition switch problems that are being blamed for some 13 deaths.

Toyota is also in the news after having agreed to pay more than $1 billion to settle with the Justice Department over a delayed recall of millions of its vehicles.

But are U.S. consumers facing recall fatigue?

Sonari Glinton covers the auto industry for NPR, and he joined us today.

Listen to the full interview above.

General Motors

Members of Congress will have tough questions for the new CEO of General Motors.

Mary Barra is expected to testify in front of the Energy and Commerce Committee next month.

Barra has only been on the job as CEO for three months. Now she’s facing scrutiny for how the automaker handled or mishandled a major safety recall affecting more than 1.5 million cars.

U.S. Sen. Debbie Stabenow says she’s confident in Barra’s leadership.

The Justice Department is investigating General Motors for delaying a recall of more than a million and a half cars. On today's show: how is this recall affecting GM's reputation?

And, a new Michigan law will now allow you to literally BYOB, bring you own bottle of wine to a restaurant.

Also, starting a business can be hard, but what about starting a business with a mission to help end homelessness? That's exactly what the Empowerment Plan aims to do. 

First on the show, Rick Pluta, Captiol Bureau Chief for the Michigan Public Radio Network and co-host of It's Just Politics, joined us to talk about how Lansing plans to spend surplus money.

user paul (dex) / Flickr

It was announced yesterday that Toyota has agreed to pay $1.2 billion to settle with the U.S. Justice Department over a delayed recall of millions of vehicles.

The Justice Department is also investigating General Motors for delaying a recall of more than 1.5 million cars. The cars have defective ignition switches that can turn the car off at high speeds.

There's also news that GM executives are being summoned to D.C. to face Congressional inquiries.

Daniel Howes, business columnist at the Detroit News, joined us today to discuss the issue.

Listen to the full interview above.

An image from the consumer alert issued for the GM ignition switch recall.
NHTSA

Last month, General Motors recalled 1.6 million vehicles because of faulty ignition switches linked to 13 deaths and at least 31 crashes.

That has grown into that biggest crisis GM has faced in years, and an early and severe test for its new chief, Mary Barra.

Yesterday she released a video making a public apology:

“Something went wrong with our process in this instance and terrible things happened. As a member of the GM family and as a mom with a family of my own, this really hits home for me. And we have apologized. But that is just one step in the journey to resolve this.”

Also yesterday, the automaker announced another recall: more than 1.7 million vehicles in three new campaigns.

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.

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