GM CEO Addresses Employees in Town Hall Meeting

[Bruce Nunnally]

WARREN, Mich. General Motors CEO Mary Barra addressed employees in a Town Hall Meeting on Thursday at the GM Vehicle Engineering Center. Her prepared remarks are below. As always, the speakers words are definitive.

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Good afternoon. Thank you for coming. I have important news to discuss today, so let's get going.

As many of you know, the Justice Department... through the U.S. Attorneys office for the Southern District of New York... has been looking into whether GM violated any laws in connection with the ignition switch issues that led us to recall 2.6 million vehicles last year.

Today, the government is announcing an agreement that resolves that investigation, and I felt it was important that we have an all employee meeting to discuss whats happening just as we did 15 months ago, when I shared the findings of the Valukas Report.

Before I talk about the settlement agreement, lets pause for a moment and remember that people were hurt and people died in our cars. Thats why were here.

I have said many times how sorry I am for what happened. On behalf of all of us, I have apologized to the families who lost love ones and to those who were injured. I do so again today.

We let these customer down in this situation.

We didnt do our jobs.

As part of our apology to the victims, we promised to take responsibility for our actions.

So we accept the penalties being announced today because they are part of being held accountable.

But apologies and accountability dont amount to much if you dont change your behavior. We have. And thats what I want to focus on in our time together.

First, lets talk briefly about the agreement. The centerpiece is whats called a Deferred Prosecution Agreement. It means that the government agrees to defer prosecution of charges against GM related to the ignition switch for three years.

After three years, if we meet all of the terms and conditions set by the government, federal prosecutors will seek to dismiss of the charges and the matter will be completely closed.

Among our obligations:

The Agreement requires us to continue cooperating with the federal government and obey all laws;

We are to work with the government to establish an independent monitor to review and assess our policies and procedures in specific areas relating to safety issues and recalls;

And we must pay a $900 million financial penalty.

This is a tough agreement. It further highlights the mistakes that were made by certain people in GM, and it imposes significant penalties and obligations. Make no mistake: we are committed to honor the obligations.

As you recall, in our meeting about the Valukas Report last year, I made the point that I never wanted anyone at GM to forget what happened.

I said I want to keep this tragedy fresh in our minds because I never want to see it repeated. I feel the same about this agreement: we should not forget about the consequences of our actions.

Ive talked often about behaviors, and how they define our culture.

Facing our problems head on is a behavior that drives us its how we will fulfill our mission to become the worlds most valued automotive company.

Todays news is difficult for all of us at GM, but the way we responded to the recall is a testament to who we really are and to the strength of our core values the customer, relationships and excellence.

With respect to excellence, lets remember we are committed to act with integrity we are committed to have the courage to do and say whats difficult and to take accountability for results.

We have talked about our values often over the last year because theyre so important to our long-term success. And you can see how they shaped each step we have taken over the last 15 months.

We conducted a swift and robust internal investigation...

We provided timely and meaningful cooperation to the governments investigators...

We furnished the government with information and a continuous flow of unvarnished facts...

We voluntarily provided various confidential documents and information...

We held people accountable for their actions or inaction...

And we established a full and independent victims compensation program that is expected to pay out more than $600 million in awards.

We lived our values... and it made a huge difference.

The specific steps we took to do the right thing at every turn persuaded the Justice Department to defer prosecution. They acknowledged as much in their announcement and it was an important validation.

Knowing GM as I do, I knew you would turn this crisis into a catalyst for meaningful change. And you have. You have made GM a fundamentally better company and the changes have benefited every one of our customers and the industry as a whole.

Mark Reuss will talk more about this in just a few minutes. Before he does, Id like to leave you with a few final thoughts.

[short pause]

The ignition switch problem has brought us intense scrutiny. It has been humbling and deeply disappointing. But we have faced our issues with integrity, dignity and clear determination to do the right thing both in the short and long term.

With the resolution of this government investigation, we close one important chapter of this story. To everyone who worked so hard to fulfill our commitment of cooperation, I express my gratitude and appreciation.

I also commend the U.S. Attorneys Office for the professional manner in which it conducted the investigation.

I have said many times I wish I could turn back the clock. If I could, I would do so in a heartbeat. But I can't. What we can do is make sure we respond the right way. We have done that... and we will continue to do so.

I concluded my remarks on the Valukas Report by saying I believe in GM and I believe in you. This past year has only strengthened my confidence in you and the company.

Thank you... and please welcome Mark Reuss.

[Bruce Nunnally]

[Bruce Nunnally]

WARREN, Mich. – General Motors Executive Vice President of Global Product Development and Global Purchasing and Supply Chain Mark Reuss addressed employees in a Town Hall Meeting on Thursday at the GM Vehicle Engineering Center. His prepared remarks are below. As always, the speaker’s words are definitive.

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Thanks, Mary, and good afternoon, everyone. Thanks for joining us.

I’d first just like to echo the things that Mary said.

This is indeed a tough settlement, another step in a disappointing journey for all of us.

But as disappointing as it is for us, we must remember that it was devastating for people who bought our cars.

Again, as Mary said last year, we will never forget what happened with the ignition switch tragedy, nor would we ever want to.

You can put it in the mirror and go forward, but always see it back there.

And remember: it’s closer than it appears.

The settlement of this investigation is not the last step.

It’s another step forward for us as we grow into the great company and zero-defect product organization I know we can and will become.

As we do go forward, we cannot and will not define ourselves by our past mistakes, any more than we could or would define ourselves by our past success.

It just doesn’t work that way.

When you have success, you learn why it happened, and you build upon it.

When you make mistakes, you accept them, you correct the situation, and you take the necessary steps to make sure you never make the same mistakes again.

Last year, we determined what those steps were, and we began to act on them immediately.

And I’m proud of our organization, and the entire company, for the progress we’ve made… for the collective realization of how much more work there is to be done.

And for the enthusiastic commitment by all of us to do that work.

What have we done?

We reorganized Engineering for greater transparency, intensity and accountability.

We established Global Vehicle Components and Subsystems – and they are focused on component development, and advanced vehicle development.

Separately, we established an industry-first, Global Product Integrity organization – and they are focused on systems engineering.

Systems Engineering defines our failure mode criteria for all of our critical safety and performance components.

Also, part of our product integrity organization is our newly formed global vehicle safety organization.

This organization is focused on executing zero-defect safety systems for our vehicles and customers.

We have added more than 30 product-safety investigators to proactively search all emerging issues.

As part of this organization, we have established an industry- leading emerging issues and data analysis team.

This team is using industry-first analytics to spot any data points which could happen, before they happen.

We have also completely re-engineered the whole safety and field investigation process.

In addition, our "Speak up for Safety" program has been extremely successful.

It has provided all employees and suppliers an opportunity to report or suggest any potential safety related items – without fear.

Finally, we are working together with NHTSA to forge a strong relationship, which is customer focused.

In this settlement, we are making the additional commitment to the federal government, and to the appointed-Monitor, that we will be leaders in vehicle safety, and we’ll be candid and transparent about it.

When we do the right thing, it reinforces that our customers – and their safety – is at the center of everything we do.

We should all remember what happened today, and why.

I’m proud of how we all have responded, but I’m even more proud of how we have repositioned General Motors to reclaim our leadership position in safety.

Our teams are identifying and fixing issues before they become issues.

Our field actions are smaller in volume, because of our speed and focus on identification.

I want to be part of a company known for safety, and a zero-defect mentality.

I know you do, too.

The work our teams are doing continues to set new standards for protecting our customers and preventing crashes.

Technology is advancing quickly, from autonomous vehicles to alternative propulsion and beyond, and we’re working it from all angles, and we're dedicating a significant amount of investment and people to deliver what the future of transportation demands.

Automation is, after all, the ultimate safety objective.

We’re going to deliver vehicles and features to astound and amaze people, with safety as our center focus.

We cannot do this without each person's passion and focus.

I appreciate your dedicated support and determined effort.

And for that I say "Thank You."

[Bruce Nunnally]