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MENDOZA IN THE NEWS

GM Reports 3 More Recalls, ‘Redoubles’ Safety Efforts

by Jeff Green
Publication: Bloomberg

March 17, 2014


The following is an excerpt from a Bloomberg article that quotes Management Professor Kaitlin Wowak on General Motors CEO Mary Barra’s message to consumers. To read the entire article visit: GM Reports 3 More Recalls, ‘Redoubles’ Safety Efforts


General Motors Co. (GM) is recalling 1.55 million vans, sedans and sport-utility vehicles, citing concerns over brakes, seat belts and air bags, adding to 1.6 million cars recalled this year due to faulty ignition switches.

The automaker also said it expects about $300 million in expenses in the first quarter to cover the cost of repairs for the more than 3 million vehicles, according to a statement today. Delphi Automotive Plc, the auto supplier that was once part of GM, is adding a production line to expedite supply of replacement parts, Barra said in a video statement.

The new round of recalls follows criticism that GM was slow to act on earlier concerns over vehicle safety. It took the automaker more than a decade to begin recalls on the Cobalt and other small cars that were the subject of complaints as early as 2003. The ignition switch defect threatens to harm GM’s reputation and complicate efforts under Chief Executive Officer Mary Barra to recover from its 2009 bankruptcy.

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“I asked our team to redouble our efforts on our pending product reviews, bring them forward and resolve them quickly,” said Barra, who started at the company as a college intern.

The CEO’s video message may have helped mitigate any damage to her reputation as the leader of the company. She took the top job in January, about a month before the recalls were announced.

“It does make her more human to mention her status as a mom as part of the commitment to safety because moms want to hear that,” said Kaitlin Wowak, an assistant professor of management at the University of Notre Dame in South Bend, Indiana. “But the tricky part for her is that since she came up through the ranks of GM, she’s not going to get as much leeway as she would if she were an outsider coming in.”