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Examining the GM recall Scandal Part I: What GM knew

It has been approximately six months since news about the General Motors recall began making national headlines. In February, GM finally issued a recall of vehicles with faulty ignition switches. We say “finally” because it now seems clear that some GM employees knew about the defect as early as 2001.

After an investigation and a several-hundred-page report, General Motors responded by firing 15 employees. Around the same time, the National Highway Traffic Safety Administration conducted its own internal investigation to determine if its employees had been negligent in responding to consumer complaints about fatal car accidents in GM vehicles. Recently, U.S. Secretary of Transportation Anthony Foxx announced that no one at the NHTSA has been fired or disciplined over the GM ignition switch scandal.

Should the NHTSA’s culpability even be a consideration in this case? Isn’t that a distraction from the larger issue of GM’s massive failure? These are not easy questions to answer. At the very least, the NHTSA’s failure to “put the pieces together” suggests that the agency needs more funding and perhaps greater regulatory authority.

First, let’s discuss what General Motors allegedly knew and did not know. According to the investigation report, there were only about 15 employees who understood the scope and gravity of the problem. Most of these employees were engineers and middle managers.

The report claims that top GM officials had no knowledge of the problems until just before the recall was issued; a claim that naturally evokes some skepticism. It is difficult to fathom how such a powerful company could continue to operate while top officials were kept in the dark about a major safety issue. And if upper management truly was unaware of these issues, that revelation in itself is also a problem.

Please check back later this week as we continue our discussion.

Source: The Car Connection, "No One At NHTSA Has Been Fired Over GM's Ignition Switch Fiasco. Should They Be?" Richard Read, July 22, 2014

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