UPDATE 3-Top GM engineer to leave in post-recall reorganization

Tue Apr 22, 2014 7:37pm EDT

(Adds former GM executive comments, details, background)

By Ben Klayman and Marilyn Thompson

DETROIT/WASHINGTON, April 22 (Reuters) - General Motors' top engineering executive, a longtime colleague and key lieutenant of Chief Executive Mary Barra, is retiring in the automaker's highest profile executive change since the massive recall of vehicles with defective ignition switches linked to at least 13 deaths.

John Calabrese has worked with Barra in various roles over the past 15 years and has been GM vice president of global engineering for the last three years.

In a reorganization announced on Tuesday, Calabrese's role will split in two to improve vehicle safety, the automaker said.

Global product development chief Mark Reuss, to whom Calabrese reports, said the engineering chief's exit was not related to the recall of 2.6 million vehicles this year. Calabrese, 55, will stay on through August to help with the transition.

Company documents provided to congressional investigators show Calabrese was apprised at least once of major developments of an internal ignition switch probe that led to the recall this year, but his role in the process is not clear, and GM declined to comment.

One former GM executive said Calabrese's exit likely reflected Reuss putting his own team in place in the product development operations rather than a move related to any role Calabrese might have had in the recall.

"I rule out the notion that anyone was sacrificed," said the former executive, who asked not to be identified discussing the turnover. "As with any super big job, at some point you get to pick your team."

The top engineer's departure follows the exit last week of two senior vice presidents in charge of global human resources, and global communications and public policy.

Barra last month appointed a global safety chief, GM veteran Jeff Boyer, who reported to Calabrese. The company also shifted Robert Ferguson, who is head of the Cadillac brand, back to Washington to help steer the company's response to the recall crisis.

At the time, Barra was asked why Boyer reported to the engineering chief, who might be part of an internal probe into the recall. Barra said she had confidence in the engineering and product development organization, declining to speculate on where the internal probe could lead.

The No. 1 U.S. automaker said global vehicle engineering is being split into two new organizations: global product integrity, and global vehicle components and subsystems. The company said it also more than doubled the number of people assigned to investigate complaints about its vehicles.

GM has come under heavy criticism for not catching sooner the defective ignition switch, which had been studied by engineers in the company as early as 2001 but was not recalled until the initial action in February this year.

On Monday, GM filed a motion in a U.S. court to enforce a bar on lawsuits stemming from ignition defects in cars sold before its 2009 bankruptcy as it fights proposed class action litigation that seeks to set aside the restriction.

And outspoken Senator Richard Blumenthal said Congress should call former GM CEOs to testify about the recall.

Reuss said on Tuesday that the restructuring will help GM identify problems faster and was a direct result of what the company found as it investigated how it failed to initially catch the defective ignition switch. He said there will be additional structural changes made to the company's product development process, but did not provide any details.

Under the new structure, Reuss said most of those responsible for vehicle safety will meet in one room every week, including the heads of the two new organizations, and that group of executives will report monthly to GM's board on safety activities.

Ken Morris, currently executive director of global chassis engineering, has been named vice president of the global product integrity business, and global vehicle safety chief Boyer will report to him. The organization will include vehicle, powertrain and electrical systems engineering as well as vehicle performance and supplier quality.

As part of Boyer's team, GM is adding 35 product investigators to an existing 20 who can follow up any consumer complaints to the company, its dealers or safety regulators, or that result from lawsuits filed against the automaker. Reuss said more investigators could be added if necessary.

"They are the data miners and the field investigators ... empowered to actually be deployed to the accident site or problem site or the dealership site, investigate the problem, make decisions very quickly on what we do, if anything," he said.

Morris said the new structure will change how problems are caught in vehicles before they are made. "This is one of the fundamental differences that we're going to have going forward, is connecting the dots on all the information that we gather and not being silo-ed so that information doesn't get transferred from one spot to another," he said.

Ken Kelzer, currently vice president of GM Europe powertrain engineering, has been named vice president of the global vehicle components business. His responsibility includes parts, advanced vehicle development and other engineering initiatives.

Calabrese is an Illinois native who started as a GM summer intern in 1979 and officially joined the automaker two years later.

After several engineering positions, Calabrese was named director of global advanced purchasing in July 1998 and promoted to executive director the following year. He returned to engineering in October 2000 and was a leader for exterior, interior, safety, powertrain and a Mexican regional engineering center.

GM launched an extensive internal investigation in July 2011 into a series of accidents in which airbags failed to deploy. That eventually led to uncovering the ignition switch defect.

One undated GM document released by congressional investigators, which appeared to be from late 2013 or early 2014, briefed Calabrese and another senior executive about the ignition switch issue in the Chevrolet Cobalt, the model most closely associated with the recall.

GM declined to say if Calabrese was part of a key group which decided on the recall. The Executive Field Action Decision Committee reviewed the internal probe of the switch in December 2013 and decided on Jan. 31, 2014, to conduct a safety recall affecting about 650,000 vehicles.

The scope of the recall was expanded two more times as GM discovered more models could have been built with the defective part. After Reuters reported that the flawed ignition switch was still widely available to consumers on the Internet, GM also recalled the spare part from repair shops. (Additional reporting by Paul Lienert in Detroit; Editing by Nick Zieminski and Peter Henderson)

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