maybe both. how in the world would they not know when the vehicle, because of the low torque, and it shifts to the accessory position and it stalls that would also deactivate the testing. i would think that kind of testing is done? how could they not know that? >> i can't speculate why they wouldn't know. i can tell you anytime a vehicle stalls now. we consider it to be a safety issue. and if we find there's a malfunction or defect in a part that causes the car to stall -- >> well, i would say a safety issue indeed if the side air bag would not inflate. if somebody got t-boned in the middle of an interaction when this happened. and a young person, even an experienced driver of 40 years is not going to think that quickly. mr. valukas. and i think you alluded to this a few minutes ago, if not for

the brook lawson lawsuit. brook, i can't see the picture it might be up on the wall. she's in my 11th congressional district of georgia. if it not for the brook lawson lawsuit and she was killed. the fact that her lawyers figured out that the ignition switch part model from 2008 was different from model years '05, '06, and 07, would we even know about this ignition switch problem today? would we even be aware of it? >> the answer is, yes, because there was an open and at that point, significant investigation going on at that particular point. and certainly, there was information and evidence that was accumulating as they were going forward, pointing to the fact that they had nondeployments. pointing to the fact they had fatalities, and pointing to the fact that the switch had something to do with it. >> that smacks of a big cover-up

to me. and after gm learned of this change, it took months for gm outside experts to confirm they had a change. why did this take so long? >> i don't have an answer for that. i can tell you it did take that long. from the aim of april 2013 when the deposition took place, they knew at that point they had two different switches and they gave it to mr. malotti, the expert, and he came back with the information and that took to almost october. >> yeah, it's amazing. and when the decision was presented in december, no recall was. it took a year before gm finally recalled that. what was issued in december that prevented gm from issuing a recall at that time? miss barra, you can tell me? >> i can't talk about the specific information. we do know that not all that information was presented that the meeting.

i would say when the right information was in front of that group, they would make the right decision and i've said publicly -- >> let me just say and i conclude in 35 seconds, this whole sequence, this whole sequence, from the time the company learned of a potential difference in the parts during the melton litigation, during the time the recalls were announced, ten months, miss barra? why the footdrag? is this typical of gm's investigations into a product concerned? and how do you intend to change this? >> well, we already have. the way we're working through recalls today. we've changed that process. expedited, most senior levels of the company are involved in. we're doing what's right for our customers and we're demonstrating that today. >> thank you, i yield back. >> i should ask a clarifying question. with regards to the words "cover-up" can you define what cover-up means, mr. valukas?

>> in this instance, what we looked for was any evidence that people took steps and knew that they had a safety issue. that's what we refer to as a cover-up. and we sought to test those facts against the documents we were reviewing. so if someone knew something on a given day, we identify that and we reveal steps to whether they concealed that. >> does your definition also include if people slow-walked moving on safety issues? is that also a cover-up? >> pardon me, i don't mean to interrupt. >> that's okay. if it was deliberately done, then it would encompass something like that. if it was a matter of someone being in a position, for instance, when one of the investigators was given the assignment, he was given no deadline. he was given no sense of urgency. so he put it in the queue with

other investigation. that, i would not call a cover-up, i would call that something other than that. >> thank you. >> thank you, mr. chairman. miss barra, welcome back to the committee. when you were here on april 1st, i told you that a member of my staff had a chevrolet malibu was subject to the recall. she found that out by going through the website, not through any personal notification. and she inquired of the dealership how she should proceed. and they said there's no fix. i presented you with that dilemma. and you said there say fix whether there's a check or replacement of the product. and it does exist for that specific vehicle. well, i have here the important safety recall that she just received on monday. so that's 2 1/2 months after you appeared here on april 1st notifying her of the recall saying that her vehicle may experience a sudden loss of

power steer assist which could result in a complete risk of crash. and also informed that the product doesn't exist yet to fix the product. so when you consider that situation, a different vehicle, a different problem, with the ignition problem that we've focused on. and you've already said that many of these vehicles will not be fixed, the ignition problem, until october, those parts won't be available. what are consumers supposed to do when they're going a period up to six months or longer, without any way to fix their vehicle? how are they -- can they assess the risk? i mean, i don't know what my staffer should do. there's no real -- i see all the pharmaceutical products, the long list of possible side effects, you have to calculate the risk. but would you advise -- would you let your son or daughter drive these vehicles now with the level of risk that you may know more about than we do? >> well, on the cobalt

specifically, we've done extensive testing on using the -- or driving the vehicle with the key or the key in the ring, and it has validated it's safe. we've also reviewed that with the technical experts at nhtsa, and they have concurred. in that case, the vehicles are demonstrated safe to drive. just in general, people can go to their dealer or the engagement center and walk through specific issues. in many of the recalls that we've done, it's not a part replaced, it's a visual check. and depending on what happens, it would be what needs to be repaired. so each individual recall has a slightly different look and feel to it. >> so, i know you've talked about the possibility of loaner vehicles and rental cars and so forth. and i understand the difficulty with a supplier gearing up to produce a part that they may not have made in four or five years. and they have to, all of a sudden, come up with several

million of them. we have a part manufacturer in kentucky, in my district, that services peterbilt trucks and i've been to theirs and i know how much work they have to do. but, again, is there any alternative to reliable alternative, to these consumers who, again, face a very important condition as to whether -- i don't know what the risk -- of whether nhtsa has assessed the risk, with regard to power steering, whether that's significant or not. but a lot of consumers out there, i'm sure, are wondering whether they should be driving or not. >> again, i would encourage them to call the customer engagement center and we can talk about the situation. >> okay. i yield to the ranking member. >> i just wanted to ask you, a question, miss barra, since there's a little time here. so you had testified that out of the roughly 2.6 million of these

dollars were recalled, you guys have set 400,000 parts out to your dealers, is that right? >> produced and ship. >> i am sorry? >> yes. >> yes, roughly. as of monday it looks like only about 177,000 of these vehicles have been repaired. and you had testified a little bit earlier -- so that's 177,000 vehicles out of 2.6 million vehicles. and we've talked about this before. is this one of our big concerns on this committee, is how do we get those folks to take in those recalled vehicles to be repaired? and you said, you're looking at some innovative ways to do that. i'm wondering if you could just take a few seconds to talk about how gm's trying to get those people to take those cars in. >> well, we're doing a lot on social media. and we're looking at the populations, especially some of these vehicles are older

vehicles. we've done actual research to figure out what messages would be most compelling to have these individuals come in to get their vehicles fixed. i would also say -- the dealers are working to do specific arrangements with each individual to make it as inconvenience -- >> as convenient. >> as convenient as possible to reduce the inconvenience. so there's a number of steps. >> let me ask you can you meet the october 4th nhtsa deadline? >> we are on track. you know, i have talked to the ceos of the companies making these parts, and we monitor it on a daily basis. >> thank you. mr. olson, five minutes. >> i thank the chair and welcome, miss barra, and mr. valukas. i approach issues like these from a perspective naval officer and a pilot. we in the navyyard are called skippers. good skippers give credit to others who do good. when good things happen in the

squadron, they give credit to others -- bad skippers -- i'm sorry, good skippers give all the credit and take the blame. by that definition, miss barra, you're a decent skipper. but people have died because of gm's defective products. as we knew, and mr. valukas' report shows clearly, those deaths occurred because our ship, gm has some problems that can't be fixed overnight. as gm's skipper, the burden to fix these problems is upon you, ma'am. squarely upon you. i think you know that. gm has to rebuilt its trust with the american people. and part of that trust is being straightforward on the number of deaths that have occur because

of these affected cobalts. you've testified that 13 deaths occurred because of these cars, is that right, ma'am? >> i've testified that with the information we have, we believe that the ignition switch may have been related to 13. but i don't have all the information. >> okay. because that's a problem, because all the while behind you, there are 15 photographs of tragic loss from cobalt vehicles. >> and that's why we're doing the compensation program that will be independently administered by mr. feinberg, and i can assure you that i and general motors want to make sure that anyone harmed as part of that ignition switch problem is part of that program. >> i'll get to nap how about injuries, what's the number, idea, ballpark? >> again, i don't have the specific number in front of me, but we don't have a complete number because we only have the information that's available to us. that's why mr. feinberg, who's an expert in doing this, we want

to have everybody who has suffered serious injury or suffered the loss of a loved one, we want everyone to be part of this program. >> restoring the trust of our the american people, part of that is having a viable, robust compensation program for the victims' families. and i know you have tapped mr. feinberg as you mentioned to evaluate options for the compensation trust fund. my question is from opening statements, it sounds that gm has not put any limits on mr. fein berg, is that true? >> i didn't hear the beginning of your question. >> the question is you tapped mr. feinberg to have this compensation funds, any limits on him? >> he is is independent and he l determine those who qualify that meet his protocol and the appropriate amounts. >> will your board have to approve his recommendations? >> no.

he is independent. >> have families that have previously reached settlements with gm, will they be eligible to this trust fund? >> they are eligible to apply. >> how much do you expect the fund to be, any ballpark? >> without knowing the protocol, i can't speculate on that. by the time mr. feinberg shares with us his protocol, then we will have to take an appropriate answer but we really won't know until the program is administered. we have indicated we will share the number of incidents and also the total. >> is there a chance the fund will be capped, a limit? >> no. >> i yield back. thank you, sir. >> let me ask you along the lines of do people know how to get in touch with you if they're having trouble getting their car fixed? >> again in the letters that we

sent and we get rengistration data, that's why it would be helpful to have a database. but in the communications we've had, there is information on how to contact us as well as their dealer. >> so the message should be a person should contact their dealer? >> they can contact our customer engagement center. there is also a 1-800 number at the back of their owner's manual, but in addition we know many people will contact their dealer p. >> before this testimony concludes today, can you provide us with that 800 number? a lot of people are watching that hearing and i'm getting a lot of activity on to wit are people wanting to know how to get their cars fixed. >> sure. >> miss caster for five minutes. >> the lucas report refers to the board's commitment to improving the quality of gm's vehicles through a bonus plan

for corporate officers and employees at the executive corre director and supervisor levels. part of the calculation was improvement in the quality of gm's vehicles. do you know what improvement in quality means or how it is quantified for the purposes of the bonus calculation? >> i can't give you the calculation. i can tell you that within the quality calculation is supposed to be safety, that the individuals who we interviewed identified quality -- improvement in quality as relating to the safety issue. so that it would include -- >> so safety is supposed to be a quality component, but how is that quantified? >> i don't have an answer for you on that. >> ms. bar are a, d bera did yo bonuses while the issues were on guilty going? >> there were some years where there was. not all the years.

one aspect is external surveys. >> how many years did you receive those bonuses? >> i'd have to check. >> so you'll provide thes to os the commission? >> sure. >> and will the bonus program be revised to include an explicit safety component? >> it already has safety as a piece of it. i will go back and review to make sure it is explicit. >> because he said he reviewed it and he's not certain how expansive it is and what goes in to considerations of safety. >> i will make sure it is explicit. it's a good suggestion. >> will gm's compensation structure for all employees including below the leadership levels now include a safety component? >> again, when you speak of all employees, 220,000 employees around the world, we comply with the different laws in those

compensation programs. but we have sent a strong signal that quality is important and recei represents a 25% across all levels. >> i would recommend that as part of your overall for all employees to encourage considerations of safety that is made much more explicit to all those employees. in the past, gm has put into place in-send i haves for high level employees to make improvements. if gm is serious about its new focus on safety, there should be stronger incentives in place for executives and all of the other gm employees at the very least to identify safety problems and improve the safety of all gm's vehicles. now i'd like to ask about the and you h adequacy of the recall. they have assured the public that it will fix the position. i hope you can assure me that this is the case. >> it's been vallu validated

extensively and nitshtsa has reviewed it. >> issue number one is that the force required to turn the switch is too low. and issue number two is that a driver's knee can hit the key or key fob and turn the switch to the off position because it is placed too low. the fix to the recall will be to install a new ignition switch with higher torque writering more force to turn off the switch, is that correct? >> right. but if you look at the switch, cylinder and key and you look at how it works as a system, it's been validated to not only talk about the issue that you're talking about about turning, but also the potential knee interference. both have been validated. >> what will the torque specification that the new switches will make? what is the new torque specification? >> the specification is 20 plus or minus five, but the more

important thing to look at is the overall performance of the system and that's what we've done. >> is that 20 newton centimeters? >> yes. >> and do you know how gm arrived at that specification? >> that was a specification, but we've gone back and tested extensively with varying levels of keys on rings with varying heights of -- size of people. it's been an exhausting testing. >> here's the concern. when the committee interviewed several gm engineers, they all told us they had no idea of the basis for that specification. and gm has received multiple reports indicating that the placement of the ignition switch in these vehicles could cause a driver's knee to hit the key or the key fob and turn off the switch isn't that right? >> neither of those individuals have been a part of the company as we have done or been involved in all of the extensive testing and validation that we've done specifically with the new product integrity organization.

so they're really not in a position to comment. >> but certainly that would raise a concern if your former engineers tip to have concerns over the fix. >> i don't find mr. degorgio credible and i've reviewed the testing done by very seasoned engineers and i'm confident that the right validation has been done of the system in the vehicle. >> i yield back. >> now recognize mr. griffin for five minutes. >> thank you, mr. chairman. ms. barra, we've talked about the compensation trust fund and you have indicated that mr. feinberg will set parameters, but you don't have those yet. he will determine who is eligible and he'll make the determination as to how much they're eligible for. is that correct? >> that's correct. >> and do you know if he's going to determine, is he looking just at -- because most people have focused just on the air bag deployment and your list of 13

that you know of at this point only includes air bag deployment issues. do you know if he's looking at other parameters? >> we have told him we want to make sure anybody who suffered harm, either loss to loved one or suffered serious physical injury because of the defect with the ignition switch, that they should be a part of the program. >> so you acknowledge that if you're traveling down the highway at a fairly good rate of speed, and all of a sudden your car cargos into a stall, you have to put it in neutral and restart it, that will be responsible for a number of the accidents that took place whether or not the air bags were deployed, there might still have been an injury as a result of that, you acknowledge that? >> if the ignition switch was part of the issue, we want them in the program and there are

other sdipincidents. >> so i have to question why you have one of the two folks in the incident referred to in trooper young's accident report, one of those two people is on the list of 13, but the other is not and that raises the question. she was in the back seat. so the air bag doesn't affect her, but clearly that accident made very we may very well have been the result that you had a young driver who suddenly finds themselves in a an emergency situation on the highway going 48 miles per hour and they don't have an engine that works anymore. and you would agree that if the engine is not working, power is off, you don't have power steering any are more, do you. >> we were clear about the 13. but again, we want to get everybody who was affected and that's what we're focused on. and so again -- >> you want to make sure everybody is fully and fairly compensateded. >> that's correct. >> so why are your lawyers still trying to seek protection in the bankruptcy court? >> we are not going to revisit

those decisions. i think what we're doing is going above and beyond with this compensation program to get to the people. this was a unique series of mistakes made over a long period of time. we feel it's the right thing to do to -- >> so you feel it's the right thing for gm to continue on to ask your bankruptcy lawyers to defend them and get the shield from the bankruptcy court in the course and not have to deal with these cases that come up and to only let the -- the only solution being mr. feinberg? >> mr. feinberg's program is a voluntary program. otherwise people have the same rights they have today. >> they have the same rights, but you're trying to block those rights in the bankruptcy court yes or no? >> our intent is to do a compensation program and the right thing for these individuals. >> but you'restructing your lawyers to back off the bankruptcy case. so if mr. feinberg's parameters

don't mitt but a competent court finds they might, not going to matter to you. i'll move on to another question. i'm concerned a little bit about the fact that your legal department didn't pick this up. were any of the lawyers fired for not being dill gept? >> there were four different functions in which individuals were fired. legal being one of them, engineering, quality and public policy. >> because it did concern me that the trooper young's report was sitting in the gm files in the legal department for a period of about six years and only one person opened the fire during that time period and that was the legal assistant. let me ask you this. can the lawyers -- i think they ought to be, but can the lawyers start a safety investigation? >> anyone in the company can raise a safety issue. we want them to. and they're more than able to do that. >> and in this case the lawyers

didn't do that and is that why one of them may have been fired? >> clearly there were people that didn't share information to put all all the pieces together. and those individuals are no longer with the company. and we're strongly encouraging everybody in the company to raise issues. i will tell you -- >> i'm about to run out of time, so i appreciate that. in closing, if gm truly wants to compensate everybody who has been harmed fully and fairly, they ought to ask their lawyers to stop asking the bankruptcy court for bankruptcy court protection and let these matters work their way out. thank you. yield back. >> the lucas report identifies mr. ray de sgchlt orgio who he

say has no credibility to approve the deadly ignition switch this 2002 and to modify it in 2006. your report states that one of the key failures was, quote, the decision by a single engineer who did not advisories of his decision to accept an ignition switch with full knowledge that it fell well below gm's own specifications. is that correct? >> right. >> the implication here is that mr. degorgio acted alone, but the report describes problems soer associated with the ignition switch many of which were known as early as 2001 according to the report, the, quote, entire electrical concept needed to be redesigned end quote. the switch had significant problems that were known to gm. and i want to congratulate of staff of our committee for the amazing work that they did independently to investigate all

these issues. in his interview with the committee, mr. degorgio told committee staff that he met with his superiors around february 2002 to inform them that the ignition switch would be delayed. attendees at the meeting included the vehicle's chief engineer, the program engineering manager, and electrical directors. it was clear the switch was getting a lot of attention. so ms. barra, is it your belief that one engineer, mr. degorgio, unilaterally approved a part plagued by problems from the start? >> the basic issue is that the switch that he approved to go into production did not meet the performance requirements. that was the first mistake. >> and it was his alone is this. >> he was the one responsible for it. >> knowledge of the problem is important.

t report notes there is no evidence that degeorge i don't told others at gm including engineers on the caldwell program about the spring change to the ignition switch. it notes other employees had received documents describing the ignition switch change as early as june 2006 and that these documents clearly indicated that the switches used in pre-2007 models were not within specifications. is that correct? >> the answer to that question is there were e-mails which were forwarded to other individuals which contained within those e-mails after the change was made information about the fact that the torque had changed. we interviewed those individuals. those individuals were by and

large in the warranty area. they had no -- they were looking at something that it meant nothing to them as the two we were able to locate and find. it was not -- they were totally unaware of the issues concerning the switch not deploying any aspect. so the one individual who did know all of the facts and had that information was mr. degorgio. the other engineers, it meant nothing to them. >> but there is an e-mail i'm holding here that discusses implementation of the new -- >> page 102? >> i believe that's right. >> the quote is increased torque forces to be within specifications. and it was sent to five gm employees on june 2, 2006. but we have also obtained another document that was not included in your report, and this document indicates that another sgchlt m contract

engineer may have approved the 2006 change. it's a production part approval process report obtained by delphi through gm's global quality tracking system. it is dated june 1, 2006 and it lists gm supplier quality engineer -- a sgchltgm supplier quality engineer. and the notes read, new pcb and sprung plunger implementation for performance improvement. part approved per supplier submitted warrant and gm. so have you seen that report, the global quality tracking system. >> yes. >> so did you interview the listed supply quality engineer or look into what role he might have played in approving the switch change in 2006? >> we did the following.

we looked at that change and what happened was the following. supply quality engineer's function is to determine whether the boxes are filled out and materials are properly identified here. and then he submits that and puts that into the system. he does not have as we understand it anything to do with making decisions on the change. he's actually functioning as somebody putting something into the system. i don't think we interviewed that particular individual. we know what his function and role was. >> i don't want to minimize mr. degorgio's roam degorgio's role, but i do think the documents problem the problem is deeper than one rogue engineer. and i yield back. >> now recognize mr. johnson from ohio for five minutes. >> thank you, mr. chairman.

m your report ask yous an early may 2005 e-mail about a concern concern about the ignition switch. that's at tab 12. your report focused on mr. degorgio's awareness of this exchange. there were others on this change including doug parks. what was doug parks' position at the time? >> i honestly don't recall his title. >> wasn't he the vehicle chief engineer? >> he may well have been. i don't recall. >> let's assume that he was because that's what we think he was. why was it more significant that mr. degorgio was aware of this exchange rather than the vehicle chief engineer? >> i don't know that it was more significant. it was significant because mr. degorgio ultimately made the decision to change the part. and in our interviews with him, he said he was not aware of the fact that this was an issue, that he was not a wafware of th

publicity and eve-mail traffic while we had information that that was not the case. >> what is the chief engineer's responsibility? >> within the company? i do not have an answer for that. i'll find out and be happy to smi submit that. >> the chief engineer is responsible for the overall integration of the vehicle and making the wall and tradeoff decisions for that vehicle. and if issues are raised to him, then he or she will deal with that. >> what knowledge should someone in the chief engineer position have about the vehicle compared to someone such as mr. degorgio? would it be reasonable that the vehicle chief engineer would have known about this situation? >> again, there are 30,000 parts on a car. the chief engineer has to count on the people doing their job. in the mid 2000s, there was validation engineers that were added to make sure the process

was done well. and now with the product integrity organization, we'll be validating the sub systems. but the chief engineer -- >> takes information from those that -- >> right. the system works -- >> i got to move on. in a may 4th response, mr. parks requests a plug to insert in the key head since it appears to be the only in his quote only real quick solution. but this solution was not implemented for months. do you know why? >> part of the defunct of what was happening in the organization. they were treating this as a customer convenience issue rather than a safety issue. so they look at issues in terms of price, expense, cost. >> rather than safety. okay. a few weeks later on may 17, a new prts was initiated and the program team decided to pursue additional solutions beyond the service fix for the key insert. a short term production fix for a new key that changed the slot

to a hole and a long term solution to introduce a more robust ignition switch. who was responsible for initiate and implementing these changes? >> these would have been the committees involved -- and i don't have the name in front of me. but the committees that were involved in the review and ultimately they didn't make -- they didn't do what they said they were going to do. >> were they reviewed by the vehicle chief engineer? >> i don't know that. >> do you know -- >> as i read the report, i think what you're referring to was continuous improvement team and i believe that the chief was not there, it was the program engineering manager. >> why does it take until 2009 to implement the new key head and who was responsible for ensuring that this change was implemented? do either of you know? >> i can tell you the reason it was delayed was because it was treated again as a customer convenience issue. they had an issue with regard to their supplier and a dispute

with regard to his ability to deliver. and it wasn't until 2009 that the dispute was resolved and they ultimately made that change with regard to the key. >> ms. barra, in my previous life, i worked in a publicly traded company as a part of the executive team. we have a risk and compliance department, we have a risk in compliance director. my understanding, part of the concern that you're continuing to address is that this information never bubbled up to some of the key decision makers. the s.e.c. requires there are laws that require reports of risk and compliance related issues. were any of the s.e.c. reports or risks -- were the risks in

compliance folks notified that millions were being paid out for claims as a result of some of these problems? how does it break down that bad in a company that is, you know, publicly traded? >> i can't speak to specifically what was in an s.e.c. report, but what i can tell you, it's unacceptable the way things broke down and that's why we've made dramatic process changes. but as congresswoman degette indicated -- we want to make sure we have the safest and highest quality vehicles on the road. >> thank you, mr. chairman. i yield back. >> welcome to our panel. as we examine what went wrong in

this terrible tragedy, the most important job i believe for congress is to strengthen and improve auto safety laws to ensure that something like this never happens again. we owe that certainly owe to the families of the victims of this tragedy, many of whom are in our audience today for the hearing. that being said, one area that i believe we need to address is to improve early warning report data. can you describe briefly early warning report data? >> what is the data itself is this. >> yes. >> information that comes to the attention of the company which indicates that there are potential safety problems of which they are required to make alerts. >> and i believe the 2000 tread act requires the information being reported to nhtsa? >> that's correct. >> so you describe a number of cases where gm investigators analyze this tread data to attempt to identify are or explain air bag nondeployment in

cobalts and ions. is that not correct? >> i ccannot give you a number f where that was done. >> and federal governmefederal able to identify the defect? >> the issue of the nondeploy the of the air bag was a matter of discussion in 2007 about between nhtsa and general motors. nhtsa noted there were nondeployments. gm's response was to begin an investigation to see -- to keep a chart of what was taking place. there were no major further discussions about that issue until 2013. >> it seems that part of the problem here is that early warning report data provided to nhtsa are reported in 23 broad categories. in the case of this defect, early warning data provided to

nhtsa spanned several categories including engine, air bags and category of other. nhtsa says request more detailed information from manufacturer but it is difficult to know what to request given the minimum level of detail provided in the first place. nhtsa needs more detailed early warning day take so that they can spot trends and request the most useful followup information from the auto manufacturers. and more early warning data should be available to the public. we can all appreciate the value of outside experts in spotting issues that otherwise go undetected. finally, nhtsa needs appropriate enforcement mechanisms to ensure auto manufacturers comply with the laws. especially when safety is at stake. on may 16, gm agreed to pay the maximum fine for failure to report a safety related defect to nhtsa and that i believe is $35 million.

ms. barra, what was gm's net income in 2013? >> just under $4 billion. >> just under $4 billion. so the penalty for failing to report the ignition switch defect is less than 1% of gm's earnings for last year. >> that is a correct math, but i think our intent is that we deal with safety issues -- by the time you get to talking about a fine, the customer's already been impacted in an incredibly negative way. we want to make sure we're putting high quality safe vehicles on the road and we want to work in cooperation with nhtsa to do that. >> none the less, it is not much of a determent, mr. chair. we need to increase this maximum penalty. 35 million is not an adequate deterrent to a large profitable company like g permit. if the penalty had been higher,

gm might not have waited over a decade to report this safety defect to nhtsa. and it's clear to me nhtsa needs higher penalty authorities. we need to make certain the penalty for not reporting a safety defect is a sufficient threat to deter auto companies from needlessly delaying safety decisions. fixes in these areas like the tsb's public improving early warning report data and increasing penalties should be easy for us to agree upon. and with the seconds i have remar remaining, the gm website indicates customers should only utilize the key, key ring and key fob if equipped that came with the vehicle. ms. barra, many consumers have key chains with multiple keys. why if the new replacement switch is adequate does gm still recommend that consumers not use their full key rings the way they would normally use them?

>> again, the system meets and has been validated and also by nhtsa. but as i have gone through this process over the last three months, i have seen incredible things on key chains that across the industry, i think this is actually an industry issue that we have to look at. i notice key chains everywhere i go now and i just think it's something that needs to be addressed more broadly across the industry. >> i yield back. >> now recognize will lomr. lon five minutes. >> thank you all for be here. do you feel like that you conducted a thorough investigation? >> yes. >> according to what you testified to today, if my math is right, how many people are on that team, how many people investigated along with you? >> the number of individuals who were employed at one point or another in reviewing documents, doing interviews, several

hundred. >> according to my math, you all looked at 1220 documents a minute. >> sorry, say that again. >> i said according to my math, you looked at 1220 documents a minute. if you said you had access to 41 million documents. i don't know how in the world you you could do a thorough investigation in that time frame. >> we used computers and programs to analyze the documents for purposes of kicking out those documents which are reflective of the issues that are here. we used as part of that database requests being made by congress, requests being made by us for the united states attorney's office, by nhtsa, and we isolated those documents and then gave them through three levels of review for purposes of determining whether they were relevant to any aspect here, i feel very comfortable -- >> back to my first question. you think it was a thorough

investigation. i'm not in your business, you are. so i'm just trying to learn here. >> i'm sorry. >> so the report that you released, were you sxwichbyou g deadline? >> the woboard of directors whe they employed me to do this investigation asked me whether i could get it done within a certain time frame and i told them we could. that was the deadline. it was my commitment that we could do it in that time period. part of that was associated with the fact that they wanted to now because there were deaths involved here what were the problems. part of it was because of the that we wanted to get the report out or being able to respond to congress. so we had that deadline. >> and once you got your report completed, or once you completed the report, to whom at general motors did you present the results? >> board of directors. >> and what was their reaction? >> i can't tell you what their

reaction was. i know the reaction was what you've seen with ms. barra, which is to follow up on it. >> so you didn't receive any resistance to your findings or recommendations? >> none. none. >> were you asked fto make any changes to your report? >> no, i was not. and what i did tell them and what i mentioned here, if we found something different as we continue to gather documents because there are requests here and elsewhere, we would review the report and if there was anything in the report that we found to be in error or needed to be corrected or changed, we would report that back to the board and i presume they would report it back to you. >> so other than that, does that end your -- and i apologize. i've been here about 90% of the hearing, but i did have to step out for a few minutes. >> we believe we have completed the inquiry, but as i say, we would update it if we found something which changed in any significant way. i believe back last week we found something in the report that we corrected and we

notified your staff of that immediately. >> okay. thank youyou. i yield back. >> thank you, mr. chairman and thank you to ms. barra and mr. valukus for being here today for this very, very serious subcommittee hearing. i, too, as some of my colleagues said extend my condolences to the families. it must be very difficult for you to be here and listening to this dissection of information as important as it is. these are your loved ones. mr. valukus, i do want to -- this is more of a process question that i have for you, sir. going back again over the investigation and what you've report reported, back march 2007, it says staff from nhtsa approached gm personnel in between meetings

in washington and mentioned a concern about nondeployment of the cobalts and ions. what is your understanding of the information shared by nhtsa? >> my understanding comes from the interview. i did not talk to anybody from nhtsa. we interviewed the people at sgchltgm and looked at the documents and material which is they produced as a result of that meeting and it was in the course of that meeting, nhtsa asked general motors about them and the response was the assignment of i believe it was mr. sprague at that point to look into it and document what was taking place, keep a chart essentially as to are these happening, how many are there. >> and the gentleman that you're referring to, what division was he in?

>> he was an investigator i believe with fta investigator, which means he would have been detailed in to the legal department. >> so according to our information, when the engineers returned to michigan after being here in d.c., the product investigations team, the group that terms the root cause of the problem, reviewed the claims relating to the cobalt nondeployment, but ultimately decided not to pursue it. why does the product investigations not pursue this matter at the time? >> that's a very good question. and the answer is this was some of those things passed off to another agency. mr. operation was keeping track of it. the other investigators weren't following up with regard to it. they were gathering information, if you will. but that's where they went with it. >> so when you say that it was kind of handed over somewhere else, you're referring to the product -- field performance

assessment division? >> yes. >> because according to again our information, it says afz te proceed duct investigators declined to investigate, the responsibility for being tag e tracking the claims was assigned to the field performance assessment division. do you consider this unusual, would this be typical in a situation where there has been an obvious issue that has come to light and it just couldn't of be passed off to another -- and i guess i would like to know, t too, it was given to another division, but what exactly is the field performance assessment division responsible for? was this just a way to put aside the problem because they weren't focusing on it? >> i don't know if it's typical. i did know o know it happened i case and one thing we called out

in the report of passing off responsibility from one committee to another committee. fpa would be focused on potential claims in the legal department and whether or not they have litigation or things like that which indicate existence of these problems. but they are not the products investigators. they're a different group. but then here's what you have, you had it passed off to mr. sprague who then conducted -- gathered information about it for years and nothing else was taken place other than gathering that information until 2009. so everything was in hiatus. >> do you know who it was that actually made or authorized that change, who gave the assignment to mr. sprague? >> no, i don't. i don't know if we have a name. i can get a name for you. >> if you could, that would be sporpts important. >> it was as if the legal department said we'll take care of this.

but i'll get and yyou a name. >> did the fpa ever attempt to evaluate the matter according to your investigation, did anybody address these issues? >> yes, in 2009, when they had the second continental report, then it became elevated, if you will. they realized it was something that could be associated with the switch as being the cause of the nondeployment and at that point, other things started to take place including mr. sprague going to visit mr. degorgio and asking whether there had been a change in the switch and him saying no. >> so i guess my last and final question here, was there a reluctance there, but i believe you just indicated that there was, a reluctance to actually acknowledge and address the issue. >> i'm sorry -- >> i'm sorry, that would probably be hypothesizing. thank you for your time. >> it's the committee's practice

that if another member of the full committee can is questions after other members have asked theirs. so we now recognize mr. terry, care m chairman of the subcommittee on manufacturing. >> thank you. i, too, want to recognize the parents and family members in the back. those photographs really keep reminding us why we're here and investigating today. i want mr. valukas, i want to ask you, i want to go back to i'm still stuck on how this sub spec parts were even allowed at the very beginning of the process. so in that regard, the production part approval process that they go through and they do the testing, would that 2002 bpap package be a keep document in this investigation? >> certainly would be something

i'd want to see. i think we sought it out. we've asked delphi for it and we don't have it. >> and delphi wouldn't produce it? >> they informed us they don't have it. >> they don't have. do you believe that? >> i can only report what they told us. we made requests from them from the very beginning for access to any and all documents relating to this matter. what they produced to us were a limited number of documents which were documents that had actually been cha exchanged wit. i think we may have received a few additional, but that's what we got. >> so no one's been able to locate the bpap on the ignition parts? >> that's my understanding. >> ms. barra, do you know whether or not the bpap for this ignition parts from 2002 exist? >> i don't. i believe mr. valukas and his team would have found it if it

does exist. what i can tell you is the part should never have been put in production. >> agreed. i'm proud you said that. but it would have been great to discover that in 2002 during the bpap process. and the fact that it wasn't is disturbing in itself and that's why i think those documents are extremely important as you do, mr. valukas. should this committee consider a subpoena of those records since they were not produced? you're putting me where i cannot go. let's me say this. it is clear from our fact finding that mr. degorgio approved this part. and he approved this part knowing it was well below specifications and we did not find anybody else who was involved in it. though delphi certainly knew that the part that was being

approved was below specs. >> and in that respect, you have this binder by you. and if you would turn to tab four. and it is a memo from raymond degorgio regarding the talc issue. this is an e-mail from around april of 2002, around the time of the original switch us a actually being approved, is that correct? >> yes. >> the subject is the talc issue for the ion. >> correct. >> and that talc, what role does the talc testing have on the approval of the switch, do you know? >> it's part of the process. it's been explained how does it feel when you make the turn.

they want to make it feel like it was a european sports car, something like that. >> does this e-mail from raymond de sgchlt i och-- to raymond degiorgio, does that raise any concerns to you as the investigator 34r5urly the sentence in sentence that he did no sentence that he did not find spring back from crank run to accessory as terry meehan and others had observed? >> were you aware of the discussions about the feel of the ignition switch? >> yes. >> in the last 30 seconds, you mentioned that there was an

adversarial feeling regarding -- between nhtsa and gm. who have you concluded whether -- who is responsible for the adversarial relationship? >> no, i have not. but i just noted from the documents, and this is not from testimony, more from the documents just the tone of the documents, and that's maybe an incorrect way to assume something. but that from the tone of the documents, it suggested that there was some nature of adversarial activity here. >> one quick last question. there were many times looking through the documents that under the tread act, gm should have provided notice to nhtsa. is this adversarial relationship between the two impact their decision not to provide that notice? >> no. let me -- when i say no, let me

sm explain what i did and someone else can make that judgment. we went back through all of disclosures, the tread act disclosures to look to see whether something was or was not disclosed. and at least as best we could tell, marking those disclosures what the information which was then in possession by virtue of the interviews or documents we had, it appeared to us that the tread disclosures were compliant. but i will not be the ultimate judge of that. >> thank you. mr. chairman, thank you for the additional time. >> mr. valukas, i wanted to follow up on a couple questions mr. johnson was asking you. your report says on page 2, quote, gm engineers concluded that moving stalls were are not safety issues because drivers could still man ufrt the cars. as a result, sgchlt m person they will viewed the switch

problem as a customer convenience issue, something annoying but not particularly problematic. is that right? >> correct. >> and you told mr. johnson so therefore because they called it a customer convenience issue, they looked at issues of pricing and issues like that, not issues of safety, is that right? >> that's correct. >> and this was despite the fact that really pretty early on, gm started getting a lot of complaints about the ignition shifting into neutral and the car losing all power. >> that's correct. >> in fact there was in a review of the cobalt in the "new york times, "-- no, in a review in the "new york times," the freelance writer said that his test cobalt driven by his wife stalled after her knee bumped the steering column, right? >> there were reports in the "new york times" and other newspapers -- >> cleveland plain dealer and

others. so this kind of boggles my mind. a car could be going down the highway at a high rate of speed, 65 miles an hour, and it gets bumped, it goes in to neutral. and then everything stops. the power steering, the brakes, the air bags. that's what happened to brooke melton where she's driving down the highway on her 29th birthday, i go anything stops, the car loses power, she goes into the other lane and she's killed. do you know about that case? >> i certainly do. >> and so yet the gm engineer said that this was a convenience issue. right? >> they not only said it internally, they said it publicly when they were interviewed by the press. they said this is our position that a stall does not constitute a safety issue and that -- >> that is just insane, isn't it? >> i won't use the word insane, but i'm troubled by that. >> okay. good. now, at the same time, gm was talking to nhtsa about whether

stalling was a safety risk. are you aware of that? >> i'm aware there were those conversations for all this period of time. >> ms. barra, were you aware that at the same time nhtsa was talking to gm in june 2004 that general motors recalled 15,000 b because of stalling risks? >> i was not involved in that area. >> so you're not aware of that. >> gay kent sie sign that had notice. did gay kent every express any concern to you about the falling and safety risks? >> no. >> okay. so basically what you're saying in your report, mr. valukas, is you have these cars that stall out at any speed really and all

of the power goes out. but yet the gm personnel maintained this was a customer convenience issue. >> that is where they were absolutely from 2005 through 2009 at least. >> now, have you ever talked to a fellow named clarence ditlo with the center for auto safety? >> i've received correspondence from him. >> did you receive this letter dated june 17, 2014 from him? >> is it in the material? >> i don't know. but we can -- yes, we'll hand you a copy. and mr. ditlo 's conclusion is that the extvalukas report is flawed that engineers did not know stalling was safety related. are you aware of this claim that mr. ditlo made? >> i'm aware of the claim. actually i know i read this letter and i september him back a nice note saying thank you for the information. >> and what is your view of

that? >> my view is that he didn't read the report and understand what my responsibility was here. that's my view. let me give my view. what we were charged to do, and i think this is very important to understand, we were charged by the board of directors to find the facts concerning how and why this occurred. we were charged with laying those facts before the board and we were charged with making recommendations. and the board was charged with the responsibility i presume of making decisions whether or not the employees within the organization to the top level lived up to their responsibilities. that was where the board's responsibility was. so the suggestions in here that we didn't cover up people or we didn't -- that we exonerated certain people is simply not correct. >> i really appreciate that answer because you clearly de n dewld delineated what you believe you were hired to do. >> that's correct. >> so there may be other information that this committee needs to gather beyond your

report, right? >> that is absolutely possible and as i said before, if we found new information as we went along, which reflected on that we would share it with the board. >> mr. chairman, i would ask unanimous concept to place this june 17 letner to the record and also a report entitled driven to safety from june 2014 talking about some of the lawsuits that we have involved in this. >> without objection, so ordered. >> thank you very much. and thank you again for coming both of you today. >> dr. burgess wanted to make a follow-up question about the phone number. >> since i brought it up a request to put to the record 1-800-222-1020 as the customer service number that should be available to customers of general motors. and also just the observation we aren't talking about the nondeployment of an air bag. the primary restraint system is the seat belt. and i do encourage people, you

got to wear your seatbelts when you drive. i'll yield back. >> i'll recognize myself. mr. valukas, when you said when you get additional data, and it was very clear in your mandate from ms. barra that she wanted this to be thorough, that if you receive that other information from plaintiffs' attorney, i hope you'll say that with us thp you said they had not responded to you as of yet, but if there is information that they have with regard to delays from general motors attorneys in getting them information, i hope you will review that and let us know. >> and to be clear, i will gather that information. whatever we get we'll have to share with the board of directors and they will make the decision as to disclosure. >> thank you. ms. barra, now with the benefit of time, cobalt and several

other automobiles had a defective switch. that switch, hitting a pothole, bumping the key ring with your knee, or heavy key fob, could have moved that on switch into an accessory position, cause a stalling of the vehicle, subsequent loss of power steering and power are brakes when the engine was not on, and also air bags would not deploy. all those things are clear, right? on page 8 of mr. valukas' report, there is reference to a technical service bulletin from 2005. and it says in here that the technical service bulletin counseled customers to remove heavy items from their key rings. that bulletin did not refer to the problem as, quote, stalling, unquote, however precisely because general motors believed customers might associate stalling with a safety problem, and only a customer who had already sxiexperienced a stall

would get information about the proposed solutions. other customers would remain unaware of the problem as well as gm's proposed solutions. i'm assuming that if you knew then what you knew now, you would not have allowed that sort of bulletin to be written in that way? >> that's correct. >> thank you. i want to refer to something that is taking place today which is important you know. that is, i took a look at the gm current website with regard to safety recall. your comments, et cetera. and i go to the section marked frequently asked questions. under the item number seven, are the recalled vehicles safe to drive. you say, simple answer to that question is yes. the gm engineers have done extensive analysis to make sure if you use only the ignition key with no additional items in the key ring, that the vehicle is safe to drive.

>> that is true. we validated that. it's also been valley at a timed by nhtsa. >> the old cobalts that could also go into a stall -- >> we're talking about as long as you have just the key or the ring, you don't have an ability to trap it with your knee, that that condition is not going to occur. that's what that statement is referring to. >> they still could not hit it with their knee. okay. >> the issue is when you look at just the key, you don't create a moment to be able to do that. >> but still what it does not say at all in this statement, customer, if you don't do this, your car may stall, you may lose power steering, you may lose your brakes, you won't have your air bag, this is apstream safety concern. it simply says this isn't a big safety deal. and then you even say once service repair is completed, can customers put a heavy key ring back on.

you say we recommend only utilize the key, key ring and key fob that came with the vehicle. so you say if you repair this, with the previous item i just quoted, if you repair this, you'll be fine and later on you say but don't change the key issue. so i don't understand how that is fixed. >> well, first of all, on the faq, there are a number of questions and there was also opening statements. i know i personally recorded videos that we have on our website to truly communicate what we need to do. it's been included in our letters. so you have to look at the complete communication, not one question. >> my point is this. i'm making a recommendation to you. you've come before our committee and i believe you've tried to be honest and straightforward. my recommendation to you, there are how many cobalts still out there, how many ions, how many other cars still affected? >> something less than 2.6 million.

>> and so far i forget how many have been repaired. >> almost 2200 thurks. >> that's a lot of cars out there that could still stall, you lose power steering, lose power brakes. you could lose control of the car. you could crash. air bags won't deploy. someone will be injured or could die. i hope that becomes a lot more glaring than simply saying, you know, it's safe to drive. i don't think it's safe to drive. >> congressman murphy, we have sent letters, we have gone on social media, i've done videos, our dealers have been informed, believe me, we take it very seriously and we want people to know that until their vehicle is repaired, that we want them to only use the key and the ring. we have done extensive communications because i don't want any other incidents to occur. >> ma'am, i hear what you've done. i'm talking about what i would recommend you still do. look, the unfortunate thing about this is that with all the things that you do like in our lives, all the things we do to

try to communicate with people, many times people don't read mail, they don't watch commercials on tv, they don't look at things like this. so you have to try all levels. up maybe gets on the comedy network or something that people pay attention. i would highly recommend that what you do is make it very clear that if you don't do this, this is a consequence. i would hope that that would be something gm would make abundantly clear. because i may not know a lot, but i know what motivates people. and if you give them the bold blasting facts, if you don't do this, you could be in a serious accident, that might wake up people to understand that in order for gm to work on safety, customers have to pay attention to this, too, and i hope that that is something people will p attention to. as i said before, i thought this report could be subtitled "don't assume malfeasance when

incompetence will do." i see this as something i hope gm does. >> we'll redouble our efforts there. >> i ask unanimous consent that the members' opening statements be entered into the record. i ask unanimous consent that the document binder from the hearing be entered into the record subject to appropriate redactions by staff. in conclusion, i want to thank the witnesses today and the members that participated in today's hearing. i remind hearings they have ten business days to submit question

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. the thesis of the book is that there is a whole group of people in america, in fact, a big swath of america, that is being ignored, left behind, not included in the discussion, i think, for either party. particularly, though, i would argue the republican party. i call them blue collar conservatives, the folks out there that are working people, most of whom don't have college degrees. folks that really still understand the value of work and the importance of work and responsibility and people who understand the importance of family and faith, believe in freedom and limited government. you would say, wow, those are conservative republican voters, and in many cases they're not. in fact, a lot of them aren't voting at all because they don't really see either party talking