Source: The Wall Street Journal By Jeff Bennett
General Motors Co. ordered a half-million replacement ignition switches to fix Chevrolet Cobalts and other small cars almost two months before it alerted federal safety regulators to the problem, according to emails viewed by The Wall Street Journal.
The parts order, not publicly disclosed by GM, and its timing are sure to give fodder to lawyers suing GM and looking to poke holes in a timetable the auto maker gave for its recall of 2.5 million vehicles. The recall concerns a switch issue that is now linked to 30 deaths and has led to heavy criticism of the auto giant’s culture and the launch of a Justice Department investigation.
The email exchanges took place in mid-December 2013 between a GM contract worker and the auto maker’s ignition-switch supplier, Delphi Automotive PLC. The emails indicate GM placed a Dec. 18 “urgent” order for 500,000 replacement switches one day after a meeting of senior executives. GM and an outside report it commissioned have said the executives discussed the Cobalt at the Dec. 17 meeting but didn’t decide on a recall.
The emails show Delphi was asked to draw up an aggressive plan of action to produce and ship the parts at the time. In the months that followed, the size of the recall announced Feb. 7 would balloon and spark an auto-safety crisis, casting a shadow over the industry and leading to widespread calls for faster action by auto makers addressing safety concerns.
Delphi, which declined to comment on the emails, produced the documents pursuant to a discovery order connected to a court case now being heard in New York. The parts maker removed the confidential designation after Texas attorney Bob Hilliard questioned whether the emails needed to remain confidential material.
A judge has set a January 2016 trial date in that case brought about by a group of complainants claiming economic loss, death or injury connected to the switch issue after GM emerged from bankruptcy in 2009.
GM spokesman Alan Adler said the company followed proper National Highway Traffic Safety Administration procedure by submitting a correct defect chronology, and wasn’t required to disclose details of a parts order.
NHTSA, which has fined GM $35 million for delays related to the recall, declined to comment on the emails.
Mr. Adler of GM also referenced an independent investigation done by Anton Valukas, a Chicago attorney who at GM’s behest spent months researching the recall timeline. Mr. Valukas’s 315-page report is extremely detailed but doesn’t mention the parts order.
Mr. Valukas couldn’t be contacted for comment on the matter. He has said he was assigned to find out only why it took so long to initiate the recall.
Mr. Adler said GM didn’t try to influence the Valukas report.
It isn’t uncommon for auto makers, before a recall, to check on parts availability and place orders for parts. There isn’t a standard approach.
Still, the major parts order will be used by attorneys representing thousands in class-action lawsuits against GM, which claim the auto maker delayed informing the public of the problem for as long as possible.
The switch order, nearly two months before GM told NHTSA of the need for recall in early February, suggests the company took initial concrete action to address the defect, but outside of scrutiny by regulators and vehicle owners.
Attorney Hilliard described the emails as a “brutally callous” display of indifference on GM’s part. “GM, on an emergency basis, orders a half a million ignitions switches and tells no one?” he said.
The order appears to help fill out a timeline the auto maker has presented to Congress and others investigating the matter of the faulty switches, some on cars built a decade ago.
GM engineers knew in 2003 there were problems with the switches, but it took years to figure out the cause and directly link the switches to fatalities. Too much weight on the ignition key or a jostling of it can move the switch from “run” to “accessory,” cutting power to the air bags and braking system.
Sen. Richard Blumenthal (D., Conn.), when told of the emails, said they raise new concerns about the Valukas report, which congressional leaders and others have used to better understand why it took GM so long to respond to the switch problem.
“This order for 500,000 parts raises deeply disturbing questions about the validity of the Valukas report,” said Mr. Blumenthal, “but more important, the timeline of GM’s effort to protect its car owners. The question is why the delay and how many lives were put at risk since GM waited at least two months before issuing a recall even though it had already decided to order parts?”
The Valukas report was issued in late May, and was followed by swift action by GM Chief Executive Mary Barra . She dismissed 15 managers, engineers and lawyers.
Some of those dismissed were in a critical meeting Dec. 17. Led by John Calabrese, then vice president of engineering, it was to discuss the Cobalt ignition-switch issue. Meeting minutes weren’t kept. GM’s own chronology and the Valukas report indicate no recall decisions were taken at the meeting or the day following.
The next day, however, emails show a GM contract worker at Menlo Worldwide Logistics asked Delphi for a plan to build and ship 500,000 replacement switches. On Dec. 19, this employee in another email confirmed she had placed the order.
The emails refer to the affected cars as a “large vehicle population.” The employee told Delphi “I would need to start seeing shipments ASAP... Please put together and [sic] aggressive plan and I can adjust accordingly.”
Ms. Barra has said she wasn’t informed of the ignition-switch problem until late December. At the time she was head of global product development and purchasing and supply and had been picked to be the next CEO.
On Jan. 7, Delphi was told the parts would be rolling out over an extended period involving 709,000 Chevrolet Cobalt, Chevrolet Pursuit and Pontiac G5 vehicles. The model years ranged from 2005 to 2007.
Delphi provided a shipping plan on Jan. 21, according to the emails.
NHTSA was initially informed that the problem affected 780,000 vehicles. GM later publicly expanded the number.