GM Recall Probe Claims 15 Jobs, Clears CEO Barra

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June 5 (Bloomberg) -- Bloomberg’s Matt Miller and Bloomberg View contributor Ed Niedermeyer examine what was learned from General Motors internal investigation into a delayed recall of an ignition-switch flaw and what it means for the automaker going forward. Chief Executive Officer Mary Barra, who was cleared of wrong-doing in the report, revealed the results in a company town hall meeting. They speak on Bloomberg Television’s “In the Loop.”

Bad it was or how long the problem had been festering.

I think everyone who is watching internally and externally now feels a little bit bad for her because she has been thrust into this situation.

Maybe others knew about it and said let's get out of here and put her in charge.

She has been given the hot potato.

The other thing that is interesting is not that they fired 15 people or that five people have been disciplined, but the fact that she is calling on employees to become whistleblowers.

She is asking them to bring any problems they see to their supervisors.

A whole change in culture.

And if not to the supervisor, she says contact me directly.

That is different than the old gm where you would be terrified to talk to the ceo.

You never would have done it unless you were reporting directly to her.

It is very interesting.

It is probably an industrywide shift.

They want to do recalls as quickly as they can, as many as they can get out of the way so they never have to face the kind of problems that will be costly when they administer this commission.

Ed, you're skeptical.

I need to see the whole report and who the employees are and why they were let go.

There is a lot that needs to be understood.

On a basic level, the problem with this whole situation is that having employees become a bit to the safety of their customers is an entry-level cultural competency that every automaker needs.

You have automakers in the 1970's and 1980's embracing this idea that -- ideas from improvement need to come from the bottom up.

Employees need to be able to share ideas.

The fact that gm is only now rumbling on this reality is troubling.

I am sure they had that as a philosophy within their company, but it was just -- as matt was pointing out -- not the way it was being executive internally.

-- executed internally.

The question out there -- is in competence and not knowing about the situation and that these problems with communication existed for so long, that is also part of the problem.

I am curious to see where this report delineated responsibility.

At what point did senior management -- were they negligent in not trying to find out about the existence of these communication problems?

I want to see the whole report as well.

You want people who were responsible to be held responsible.

You want to deal with the past as well as you can.

More importantly, going forward, there needs to be a cultural change.

Previously, although it should not have been that way, you were afraid to tell your supervisor that something was going wrong because, much like ed snowden, you thought you would be -- for that.

Now, she is saying come out and talk to me directly if your boss is doing something wrong.

That is a turning point for the company.

I think there is no doubt that the right things are being said here.

Culture is about saying these things and setting these patterns.

Is this something -- when she was speaking, she was walking a line between talking about this issue and referencing all of these other recalls.

My question is -- is this report just focused on what happened in this one case or is it something that is addressing the fact that gm has recalled basically the equivalent of every auto they have sold in the last five years.

Does it address the broad -- the depth of this issue?

I do not know.

Listening to her talk, it is not clear.

Do you feel there is continued confidence or do you have continued confidence that she is the person to lead gm and to continue through this investigation?

I think what we have so far is mary barra and it gm's version of reality.

I think making conclusions about this before we hear from anyone else -- i think gm has a track record of creating its own reality.

I am not ready to draw any sort of total conclusion based on this report.

I think this is the opening step in this process.

I think we need to hear from lots of other information sources.

Are you saying this report is not critical enough?

I have not read it yet.

I think one issue i have is the fact that the chief counsel was a target of this investigation and they participant in it.

That raises issues of credibility.

Gm has a record of constructing its own reality.

I cannot take it at face value.

I need to read the report and understand what it says.

This is a starting point in understanding what happened here.

It is the opening bid and we need to hear the whole story from independent sources and professional investigators that are not paid for by gm or part of the gm, like the investigators with this report do.

On the business side of things, is it still pretty smooth sailing with their relationship with dealers?

As far as their relationship with dealers, i think they have done, at least from the dealers that i have spoken with, everything they can.

I did not have a terrible relationship previously.

They do not have the kind of relationships that toyota or bmw has.

The recalls did not help.

The dealers and everyone realized this was not the kind of problem you complain about by the water cooler.

This was armageddon.

It was a serious problem that they have to meet head-on in order to deal with it or it could spell -- not the end of the company -- a real issue.

We have not seen the report yet.

Mary did not just read us the worst parts of the report verbatim.

We have not seen any outside investigations, unless you consider the valukus investigation that.

-- valukas investigation that.

If you are paying me to do something, i feel like i have an inherent conflict of interest.

I am getting money from you to do this.

Whatever the case may be, there is an industrywide cultural shift.

Other companies have been better at this in the past.

Toyota, although they have had their issues.

Ford made a cultural shift after alan mulally came on board.

The whole industry -- as you have seen from the amount of recall so far in 2014 -- it is probably going to be a record year.

This shift has got to bring everyone along.

It will bring gm along as well.

Regardless of how much mary barra new, it is becoming clear she did not know much at all.

It is almost unforgivable she did not know.

She wants to know from now on, everything that happens.

This issue, it is going to cost them billions.

Is there a too far the other way?

I am happy when i get a recall notice.

It will take a few hours to fix, but they are paying for it and they are guaranteeing my safety.

I feel like recalls are not necessarily a bad thing.

If you get on the problem right away and deal with it instantly, hopefully the world will be a better place.

It is good when companies are on top of situations.

Thank you.

Matt miller, our auto expert.

I know you will be around.

Thank you to ed niedermayer.

This text has been automatically generated. It may not be 100% accurate.


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