Tablet Business

Did GM, like Toyota, hide its safety flaw from regulators?

General Motors’ lengthy delay in disclosing defective ignition switches, which are now blamed for at least 13 deaths, bears a striking similarity to Toyota’s concealment of deadly acceleration problems in its automobiles that triggered a U.S. criminal investigation and $1.2 billion in fines.

Both automakers redesigned critical parts without changing the part numbers, a step that made it more difficult for regulators and private litigants to identify the problem.

Toyota admitted in documents in its recent court settlement that it did so to prevent regulators from learning about a problem with “sticky” gas pedals.

GM, however, has yet to explain why it didn’t issue a new part number after redesigning its ignition switch in 2006 to reduce chances that the engines would suddenly stop operating, shutting down power steering and brakes and disabling airbags in more than 2 million Chevrolet Cobalts, Saturn Ions, Pontiac G5s and three other models.

On Thursday, the embattled company that benefited from a massive taxpayer bailout in 2009 announced a second ignition recall and a $1.3 billion accounting charge to pay for the repairs. In response to McClatchy’s questions about its switches, GM spokesman Greg Martin said the firm is “drawing from a wide array of independent expertise to guide us during this time. This includes taking an unsparing look at the circumstances that led to this recall.”

Two independent experts who have monitored auto industry safety for decades couldn’t recall any other instances in which parts were retooled without a change in their part numbers.

The disclosure of two stealthy redesigns in such a short time frame raises the possibility that the industry has used the technique elsewhere in an attempt to prevent regulators and the public from learning about serious safety problems.

Democratic Sen. Claire McCaskill of Missouri, who first pointed to the connection while questioning new GM CEO Mary Barra at a Senate subcommittee hearing last week, assailed the automaker for fostering “a culture of coverup.”

Clarence Ditlow, who has bird-dogged the industry for 40 years for the Washington-based Center for Auto Safety, said the discovery of the parts redesigns may have exposed a hole in the regulatory process.

If the National Highway Traffic Safety Administration has “to play detective with the auto companies to find out what they’re doing and what they’re covering up,” Ditlow said, it seems time to require automakers to issue new part numbers whenever they alter the design of “safety-critical parts.”

“It’s certainly a troubling development, and it seems to run counter to what the manufacturers are supposed to follow,” Sean Kane, president of Massachusetts-based Safety Research & Strategies, said of the redesign maneuvers. “They could not certify that they were following quality management systems if they were doing anything like that.”

New switch, old number

NHTSA has drawn criticism for not aggressively investigating safety issues with GM’s cars. Ditlow’s group, for example, reported finding data showing that airbags failed to deploy in crashes involving at least 303 of the recalled cars.

However, the handling of the undisclosed parts redesign may have stymied at least one avenue of inquiry.

GM’s 2006 decision to retool the ignition switch, at a time when Barra said the company’s financial condition was poor, not only reduced the problem in future models, but it also helped delay for seven years the discovery of the defect in cars already on the road.

In April 2006, GM engineer Ray DeGeorgio signed off on the redesign, which would make it less likely that a bump of a knee or minor jostling of multiple keys on a key ring would be enough to turn off the ignition. The new switch, which did not fully resolve the problem, kept the same part number.

If and when NHTSA first asked General Motors whether the switch design had changed — and how GM answered the question — could be pivotal in the Justice Department’s determination of whether the company also should face criminal sanctions for the first time.

Neither a spokeswoman for NHTSA nor GM spokesman Martin would address whether that question was asked before this winter’s recall of 2.6 million affected cars.

In the first-ever U.S. criminal case against a major automaker, Toyota conceded in its settlement with the Justice Department that it took several steps to conceal from the public one of two problems causing its Lexus and other models to zoom forward at full throttle. In the most highly publicized instance, a family of four called for help in 2009 while traveling at 100 mph, with the gas pedal stuck to the floor, before hurtling to their death near San Diego.

Toyota acknowledged in the settlement that it redesigned the gas pedal in October 2009 but kept the same part number to prevent U.S. regulators from identifying a “sticky pedal,” one of the two problems causing the acceleration. In issuing a recall in early 2010, the company publicly blamed the problem on floor mats that entrapped the accelerator, without disclosing the pedal problem.

Toyota labeled its new gas pedal design as “minor” so that it did not require a new part number “and allowed for use of old, defective parts until inventory was exhausted,” the court documents said. Toyota’s engineers did so “to prevent their detection by NHTSA,” the company acknowledged.

‘Hiding documents’

General Motors’ defect wasn’t recognized until it was pieced together by Mark Hood, an engineer assisting in a private lawsuit over the death of Brooke Melton, a Georgia nurse whose car veered off the road as she drove to celebrate her 29th birthday with her boyfriend. Trying to piece together why the ignition had turned off, Hood bought a second ignition switch. He discovered that they were designed differently but contained the same part number.

McCaskill charged that GM’s DeGeorgio, in a deposition in the family’s suit, “perjured himself” in denying that he knew anything about the different designs. The case was settled without disclosure of the redesign to Melton’s family, she said.

“This is what happens in America,” McCaskill told Barra, her voice rising. “Corporations think they can get away with hiding documents from litigants and that there will be no consequences. And I want to make sure that there are consequences for hiding documents, because this is hiding the truth from families that need to know.

“And it’s outrageous and needs to stop.”

On Friday, GM announced that it also would repair ignition lock cylinders as part of the recall, after receiving hundreds of complaints of keys coming out while the engines were running, posing the risks that cars would roll away and crash. The company said it would take a $1.3 billion charge in the first quarter, mainly because of recall-related repairs.