US automotive giant General Motors (GM) has added another high-profile member to the team charged with handling the crisis surrounding the company's most recent vehicle recall.
On Monday GM recalled 2.6m vehicles for faulty ignition switches. A failure in those meant that cars were at risk of losing their power-steering even while in motion. Year-to-date the manufacturer has recalled almost 7m vehicles Stateside, nearly as many as in all of the last four years. Critically, the component failure has been linked to 13 deaths so far.
The company's announcement was decided on by Mary Barra, who took on the role of Chief Executive just last January 15th. It was followed by an appearance from Barra before Congress, on Wednesday, which saw her field very aggressive queries.
While some might salute her efforts to clear up the matter there are those who described her answers as lacking substance. Some of the Congressmen present even described some of her comments as "unacceptable."
There is a time for everything
Having said that, and even though it is surely only a coincidence, now that a new Chief Executive is in place this might be a particularly good time to tackle the problem. As well, the firm's financial health is considerably more robust now that it has emerged from bankruptcy.
While GM apparently received complaints regarding the ignition switches on its Chevrolet Cobalts dating as far back as 2004, since the car-maker emerged from Chapter 11 in 2009 it may be able to reduce, if not dodge, legal liability, some believe.
That is because technically, in legal terms at least, it is no longer the 'same' GM.
Jeff Eller enters the scene
On Thursday Bloomberg reported that crisis-communications expert Jeff Eller has been placed on retainer. He was Director of Media of Affairs for the Clinton White House.
He will join other heavyweights such as Kenneth Feinberg, the lawyer in charge of managing the funds for the victims of the September 11th terrorist attacks, or Anton Valukas, who prepared the report on the bankruptcy of Lehman Brothers. Both of these new hires will head up the internal company investigation into the above chain of events.
Lastly, during Wednesday's testimony David Friedman, the current administrator of the National Highway Traffic Safety Administration (NHTSA), said that GM had uncovered "critical information" which the regulator had not seen before but might have triggered an investigation earlier.
So far markets seem to have brushed off the revelations, with the shares
having risen by nearly 1% since the close of trading last Friday. As of 17:09 they were at $35.03.