General Motors, under fire for allegedly ignoring internal warnings that its 1973-87 pick-up trucks are unsafe, won a minor victory last month when NBC's Dateline news program apologized for rigging a demonstration that showed one of the pick-ups exploding into flames after being hit in a side-impact collision. Unfortunately for GM, the swift settlement of the suit quickly refocused attention on the underlying problems: continuing criticism of the motor company by consumer activist groups and a series of potentially enormous law suits. The National Highway Safety Administration continues to investigate whether a recall of the trucks should be ordered and in the most recent legal action the company was ordered to pay more than $100 million to the family of teenager Shannon Moseley, who was killed in a side-impact collision.
In what The Wall Street Journal described as "an unprecedented and meticulously detailed attack" General Motors accused the network of using "sparking devices" to insure that there would be a fire if gasoline were released from the gas tank, of using trucks fitted with the wrong gas cap, and of misleading the public about the speed of the vehicle that was shown slamming into the truck.
At a press conference in New York, GM's executive vp and general counsel Harold Pearce presented dozens of exhibits, including independent videos of NBC's crash test and photos of model rocket engines the motor company claimed it removed from the test trucks, and transcripts of witnesses' testimony.
"GM now faces a poisoned environment spawned by the cheap, dishonest sensationalism of NBC," Pearce said. "It is clear that these people will go to any lengths to forward their viewpoint. They are not satisfied with misrepresenting GM's own experimental tests, but have admitted they would modify a vehicle to get a fire to occur. This is blatant deception."
The initial response from NBC was that the news conference was an attempt to "divert attention from the central issue"—the safety of its trucks. That was the suspicion of most public relations professionals, and many said they felt the strategy was effective, at least for a day.
"It was a terrific way to get people talking about the ethics of television journalism rather than about the design of GM trucks," said the president of one New York PR firm. "There are some real questions about the way shows like Dateline pursue these business stories, and brining those questions out into the open is a real public service. But in the long-term I don't see how it helps GM with its real problem, which is litigation."
However, as NBC backed down, most PR practitioners—while not judging the merits of the broader case against General Motors and its pick-up trucks—appeared to regard the public relations offensive with awe and admiration.
"I think GM has done something heroic here," says the VP of corporate communications at a Fortune 500 company. "Regardless of whether the trucks explode or not, what NBC and the consumer activists it worked with did was misleading and dishonest. All too often these groups are not held to the same ethical standard as corporate PR people, and this time GM decided not to let them get away with it."
Although the NBC segment, called Waiting to Explode?, clearly labeled the crash as a "demonstration" of what could happen, rather than a "test", the network was quick to issue an on-air apology.
At the end of the regularly scheduled Dateline show, host Jane Pauley announced that the lawsuit had been settled and acknowledged the show had used sparking devices. "NBC personnel knew this before we aired the program, but the public was not informed because consultants at the scene told us the devices did not start the fire. We agree with GM that we should have told opur viewers about these devices. We acknowledge the placing of incendiary devices under the truck was a bad idea from start to finish."
The swift apology and the $2 million NBC paid GM to reimburse the company for its investigation was clearly a public relations triumph. A public relations executive for another Detroit car company told The Wall Street journal: "I can't help but think that, psychologically, this will be a turning point for them, both in the way they perceive themselves and they way they are perceived by others."
Meanwhile, auto safety groups stepped up their attacks on General Motors at the same time the network was issuing its apology. The Center for Auto Safety has launched a publicity drive called `Campaign GM Firebombs', claiming there have been 778 accidents in GM trucks through 1990 where a fire occurred and at least one accident occurred.
GM's battle will continue on two interdependent fronts: the court of law and the court of public opinion.
In the court of law, GM has won three cases and lost four, with an undisclosed number of out-of-court settlements. However, all the GM victories came before a former company engineer Ronald Ewell changed sides and testified that the company had withheld data showing that by placing the gas tanks outside the truck's frame and protecting them with only exterior sheet metal, they were more likely to explode in side-impact collisions. And the massive settlement in the Ewell case will make it more difficult for the company to settle out of court for reasonable sums.
Meanwhile, a Business Week article warned that the real damage to the company could be inflicted by customers: "Publicity over the pick-ups might depress new truck sales or the resale value of used trucks," the magazine opined. "Lost sales could dwarf courtroom damages."
While both sides in the debate argue it out, independent scientific evidence leaves GM's position defensible but questionable. Data from the Insurance Institute for Highway Safety indicate that side-impact crashes with occupant deaths are about twice as likely with GM pick-ups as with those of its competitors. However, in all wrecks, not just those involving sideimpact, GM trucks are about as safe as Ford's of Chrysler's.
That data would appear to indicate that while GM trucks are as safe as most other vehicles on the road, the company knew of a simple design step that could make the vehicles safer, but elected not to act on that knowledge. General Motors appears to be staking its reputation on the hope that consumers will accept that the automaker's responsibility was to make the cars as safe as prevailing market standards, not as safe as they could be.
The company will likely continue to resist calls for a recall, with estimates of the cost being placed at between $300 million and $1 billion (or the equivalent of three to ten judgments the size of that awarded in the Moseley case.)
However, public relations executives say its position is weakened by a history of public relations miscues. In the words of one industry observer: "GM has such a history of putting profits ahead of people, of closing plants and destroying communities, of relishing hostile relations with its employees, of displaying contempt for consumers and shareholders, that it is not difficult for consumers to believe they could be guilty of something like this. It's going to be an uphill battle."