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GM Announces Another Recall Amid Consumer Outrage


General Motors issued a second recall yesterday on the eve of its CEO’s testimony before a House subcommittee.

The company announced that it will recall 1.3 million vehicles that may have dangerous power-steering issues. This follows another recall of 2.6 million cars that have ignition switch issues that have been linked to 13 fatalities.

CEO Mary Barra appeared on Capitol Hill to face harsh criticism regarding her company’s decision to wait 10 years to issue a recall for its vehicles with faulty ignition switches. Democrat Diana DeGette criticized the company for failing to issue a recall that would have cost 57 per car because of “the lack of an acceptable business case.”

“The company continued to sell cars knowing they were unsafe,” DeGette said. “We’re going to get to the bottom of this.”

“GM executives knew about it, did their risk calculations, and decided that no changes or recall needed to be made,” wrote Tod Robberson in a recent editorial.

Barra attributed the company’s failure to protect its customers as a result of a “cost culture” which valued profits over customer safety. Since coming to office, Barra says that she has shifted the company to a “consumer culture” with her creation of a new position – VP of Global Vehicle Safety. GM’s new executive Jeff Boyers will handle all safety complaints.

Boyers’ appointment to the new post is to prevent similar issues from arising. Barra said that GM failed to issue is recall because the information was not shared between different parts of the company.

Barra told the House committee that GM has both “legal and moral” obligations to the families of victims who were killed because of its defective products. She did not elaborate on what those obligations will be.