Fewer than three dozen stockholders showed up for the General Motors shareholders meeting in Detroit a year ago but the total is expected to be significantly higher as GM faces the fallout from the defective ignition switch that has led to at least 13 deaths and dozens of injuries as well as the recall of 2.6 million vehicles.
The GM Recall Survivors network, meanwhile, is holding a demonstration outside the June 10 meeting to call attention to what it claims was GM’s efforts to cover up the full extent of the problems created by the defective ignition switch and to evade responsibility.
Laura Christian, whose daughter died in an accident in 2005 caused by the defective switch, told reporters during a press conference outside GM’s Detroit headquarters that she has now collected evidence via the GM Recall Survivors Facebook page that the defective switch has been involved in as many as 120 fatal accidents, insisting the list is continuing to grow.
The report GM released last week and the dismissal of 15 employees for failing address the problems created by the defective switch didn’t go far enough, according to Christian. “GM’s own engineers didn’t know how their own cars worked,” she said, adding. “That seems incredible.”
GM should face criminal charges, she insisted.
(Study cites pattern of “incompetence and neglect” at GM. Click Here for details.)
“Alcohol was involved in my daughters accident,” acknowledged Christian, who said her daughter attended a party without permission. But investigators also concluded her 16-year-old would have lived had her car’s airbags deployed. The safety system failed to work when the ignition switch turned off inexplicably, she said.
Family members of those impacted by the ignition switch aren’t the only ones demonstrating outside the GM meeting. The list also includes some of the company’s blue collar employees supporting a group of injured autoworkers who lost their jobs at a GM plant in Colombia. But even that group is lending solidarity to those protesting GM’s handling of the ignition switch problem.
Ken Reimer, whose 18-year-old stepdaughter died in a 2006 accident involving a Chevrolet Cobalt, noted that the Wisconsin State Police accident investigators sent =a detailed report to GM, blaming the death of his stepdaughter and another 15-year-old passenger in the car on the defective switch. GM ignored the report from the Wisconsin investigators for six years until 2013, he said.
What particularly irks Reimer and other protesters is that the second teenager, 15-year-old Amy Rademaker, who was in the back seat of Cobalt, isn’t even counted among the 13 victims officially identified by GM.
Dan Amman, GM’s president, said last week that GM is still reviewing various claims but has not yet determined if the defective switch has caused deaths beyond the 13 it identified earlier this year. But other sources have suggested there are significantly more fatalities involved.
(GM takes big hit in new report – but CEO Barra is winning praise. Click Here for more.)
Meanwhile, last week’s report by former federal prosecutor Anton Valukas has itself come in for criticism. Sen. Richard Blumenthal, a Connecticut Democrat, dismissed it as a public relations stunt and sardonically described it as the best report money can buy. “It absolves upper management, denies deliberate wrongdoing, and dismisses corporate culpability,” he said.
“Before accepting GM’s self-serving explanation that the cause was a failure of corporate silos or culture, rather than deliberate wrongdoing, I believe that federal investigators and law enforcement agencies must conduct an independent inquiry into GM’s conduct,” Blumenthal added.
GM has already has been fined $35 million by the Department of Transportation, the maximum allowed under the law, for failing to issue timely notification to the proper authorities about the problems with the Cobalt and other vehicles.
Merrill Lynch analyst John Murphy said he is certain that settlements of claims by customers will ultimately increase the cost of the switch recall, but it is unlikely the total cost will exceed $5 billion.Overall, however, it does not appear the defective switch recall and the other recalls that have followed will have much impact on GM over the longer term, according to Murphy.
Ford survived the Firestone recall, he noted, a scandal linked to 100s of deaths, and Toyota certainly weathered the storm over unintended acceleration, Murphy noted.
(GM fires 15, disciplines 5, for handling of ignition switch problem. Click Herefor the full story.)
GM is carefully orchestrating its shareholders meeting so it lasts about one hour by using rules introduced under former chairman and chief executive Dan Akerson, who moved the meeting back to Detroit from Delaware to cut costs.
Akerson, no fan of shareholder democracy or dissent, also laid down procedures to limit discussion during the annual meeting. Only 15 minutes have been set aside for the shareholder comment period, according to the meeting agenda provided by GM. Whether the maker will be able to hold to that strict timetable remains to be seen.