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G.M. Dismisses Executives as India Begins Investigating Recall of Vehicles

July 26, 2013 by Leave a Comment

G.M. said on Friday that it had dismissed the employees for violating unspecified company policies. One of the executives was Sam Winegarden, a vice president in charge of engine programs, who retired this week after 44 years with G.M., the nation’s largest automaker.

The management shake-up came after the Indian government began an investigation into the recall this week of 114,000 Chevrolet Tavera utility vehicles sold by G.M. in India.

Indian news reports said the government was investigating whether G.M. had improperly manipulated the weight and engine performance in the Tavera during emissions testing and certification.

A G.M. spokesman, Greg Martin, declined to say whether the employees had been forced to leave because of the government investigation.

“General Motors’ investigation into our recall of the Chevrolet Tavera, which is built and sold exclusively in India, identified violations of company policy,” G.M. said in a statement. “G.M. subsequently dismissed several employees.”

One person briefed on the dismissals, who spoke on the condition of anonymity, said at least 10 employees, mostly in India, were involved. The highest-ranking employee was Mr. Winegarden, who is based in the United States and is the top engineer for the company’s engine operations worldwide.

The company, which said it was voluntarily recalling the vehicles, acknowledged that the Indian government was aware of “an emissions issue” with the Tavera, one of G.M.’s mainstream models in the country.

“G.M. India informed Indian government authorities of an emissions issue involving the Tavera BS3 meeting certain specifications on July 19,” the company said.

The company stopped production of the Tavera in India this month. It said it would make changes to vehicles built as far back as 2005 and perform the required engineering validation. It gave no timetable for notifying customers and doing the work.

The recall is a setback for G.M.’s growth plans in India, particularly if it damages the reputation of the American automaker.

“Our customers are at the center of everything we do,” said Lowell Paddock, head of G.M. India, when he announced the recall.

On Thursday, G.M. reported that its net income in the second quarter dropped 19 percent, partly because of smaller-than-expected profits in Asia.

G.M.’s chief financial officer, Daniel Ammann, said on Thursday that India was among the international markets where G.M. struggled during the quarter.

The decision to oust executives is in keeping with a zero-tolerance policy about violation of corporate ethics led by G.M.’s chief executive, Daniel F. Akerson.

“We take these matters very seriously and hold our leaders and employees to high standards,” the company said. “When those standards are not met, we will take the appropriate action to hold employees accountable.”

Last year, Joel Ewanick, G.M.’s chief marketing officer, was forced to resign after questions were raised inside the company about his handling of a sponsorship deal with a British soccer team.

Article source: http://www.nytimes.com/2013/07/27/business/gm-dismisses-executives-after-india-begins-investigating-recall-of-vehicles.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

E.U. Bans Cosmetics With Animal-Tested Ingredients

March 12, 2013 by Leave a Comment

The ban, which will take effect immediately, “gives an important signal on the value that Europe attaches to animal welfare,” Tonio Borg, the E.U. commissioner for health and consumer policy, said in a statement.

The European Union banned animal testing of finished cosmetic products in 2004. A second ban, on animal-tested ingredients, went into effect four years ago. But heavy lobbying by major cosmetics manufacturers resulted in an extension of the deadline for some tests for effects like allergies and cancer and for which there is still no substitute. Monday’s action eliminated those remaining exemptions.

Even before the new rule was officially announced, the cosmetics company L’Oréal, which is based in France, said it would respect the ban and “no longer sell in Europe any finished product with an ingredient that was tested on animals” after Monday.

But other representatives of the European industry, worth about €70 billion, or $91 billion, annually, criticized the commission for putting the ban into effect before alternatives existed for some of the most complex tests.

“Europe’s idea is to put more pressure on other parts of the world to end animal testing, but the science doesn’t match that political timetable,” said Colin Mackay, a spokesman for Cosmetics Europe, a trade association.

The most likely outcome would be “that consumers in Europe won’t have access to new products because we can’t ensure that some ingredients will be safe without access to suitable and adequate testing,” Mr. Mackay said.

The global divergence in safety rules could also mean that companies sell the same product globally, but market one version for countries like China backed up by safety evidence from animal tests, and another version for Europe backed up by evidence from alternative tests.

And there were warnings on Monday that the ban still left a loophole. Shortly after the announcement, Dagmar Roth-Behrendt, a Socialist lawmaker from Germany who a decade ago helped to steer a measure through the European Parliament that resulted in the 2004 ban, said companies still could use ingredients from tests on animals as long as the tests were carried out for non-cosmetic products like pharmaceuticals or chemicals.  

Ms. Roth-Behrendt said she did not know if the loophole “followed pressure from the industry,” but added, “This is wrong.” 

Consumers of products from deodorants to sunscreens are unlikely to notice an immediate difference from the new rules because cosmetics containing ingredients that were tested on animals before the ban can remain on the shelves.

But the move could complicate trade relations with parts of the world like China that demand animal testing as a condition for marketing cosmetics.

Mr. Borg said in his statement that he would “engage with third countries to follow our European approach.”

Mr. Borg will promise to continue helping finance the development of alternatives, so that Europe sets “an example of responsible innovation in cosmetics without any compromise on consumer safety.”

Estée Lauder, a cosmetics manufacturer based in the United States, said it did not test products or ingredients on animals and it was increasing efforts to gain global acceptance for safety evaluations that did not rely on animal tests.

Those efforts include “programs in China and other markets where in vitro testing is not accepted in order to educate scientists on the scientifically validated safety record of these methods,” Estée Lauder said on its Web site.

Estée Lauder said it does “not test our products or ingredients on animals, nor do we ask others to test on our behalf, except where required by law.”

Article source: http://www.nytimes.com/2013/03/11/business/global/eu-to-ban-cosmetics-with-animal-tested-ingredients.html?partner=rss&emc=rss

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DealBook: Alibaba Group to Split E-Commerce Site, Talks I.P.O.

June 16, 2011 by Leave a Comment

SHANGHAI — The Alibaba Group, one of the biggest Internet companies in China, said Thursday that it had decided to split its popular
e-commerce site, Taobao.com, into three separate units to better foster growth, dashing investors’ hopes of an imminent public listing of the unit.

The Alibaba Group did, however, raise for the first time the tantalizing prospect that it might go public at a later date.

The split breaks Taobao — a fast-growing online marketplace for consumer goods — into a consumer marketplace like eBay, an online shopping mall consisting of major retailers and internationally known brands and an Internet search engine focused on e-commerce.

The decision eliminates the possibility that the company’s Taobao unit or any of its three parts will seek an initial public offering in the coming months, according to John Spelich, a spokesman for the Alibaba Group.

Many investors had been pressing Alibaba to list the Taobao unit, saying it would probably become one of the most valuable Chinese Internet companies.

Jack Ma, the former English teacher who runs the Alibaba Group, has for years said that a Taobao listing was not imminent and that the unit had to focus first on development. Another Alibaba Group unit, Alibaba.com, was publicly listed in Hong Kong in 2007 and is now valued at about $7.5 billion.

But in a letter to employees released Thursday, Mr. Ma said that the company was considering listing the Alibaba Group. Although no timetable was given, and people close to the company said it was unlikely to happen within the next year, it was the first time Mr. Ma had talked about publicly listing the Alibaba Group. The American Internet company Yahoo and Softbank Group of Japan own most of the Alibaba Group.

“We won’t rule out the possibility of taking Alibaba Group public in the future, as a way to reward our employees and shareholders who support and continue to believe in us,” Mr. Ma said in the letter, which the company posted online.

The statement comes at a time when Alibaba and the major shareholders, Yahoo and Softbank, are trying to resolve a dispute over another Alibaba unit, Alipay, which was transferred to a Chinese company that is majority-owned by Mr. Ma. Alibaba said the transfer had been made to comply with Chinese law about licenses for online payment companies, but Yahoo said it had been done without the board’s approval.

Alibaba is also trying to recover after the chief executive and chief operating officer at its Alibaba.com unit resigned in February following an internal fraud investigation. Although the two executives were not involved in the fraud, they took responsibility for misdeeds committed by a small number of employees inside Alibaba.com.

The company said about 100 employees had allowed fake companies in China to register and sell products on Alibaba.com’s international Web site as “Gold suppliers,” which suggested that they were among the more trustworthy. Instead, those companies were taking orders for goods, accepting payments and then closing down their operations and escaping with the money.

Article source: http://feeds.nytimes.com/click.phdo?i=092a3703f734b7b9c0e7293ef60f6cd6

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Tokyo Utility Lays Out Plan for Its Reactors

April 18, 2011 by Leave a Comment

The blueprint for action represents Tokyo Electric’s most concrete timetable yet for controlling the reactors and improving safety at the plant, which was damaged by a massive earthquake and tsunami nearly six weeks ago.

The first part of the plan, expected to take three months, would include building new cooling systems, critical to preventing catastrophic releases of radioactive materials. The company then hopes to cover three badly damaged reactor buildings and install filters to reduce contamination being released into the air.

By announcing the construction of new cooling systems, the company implicitly acknowledged what outside experts had been warning for weeks: that the company’s earlier plan to repair the existing system was unlikely to work because the equipment was too badly damaged. The change in approach means that the country must resign itself to several more months of radioactive emissions — into the air and possibly into the Pacific — even though the plant appears to be less volatile than it was.

For weeks, workers have been consumed with reacting to a cascade of problems created not only by the original disasters but also by makeshift fixes for bringing the plant under control. By making its announcement on Sunday, Tokyo Electric was trying to show that conditions had apparently improved enough in recent days that it was now able to turn some of its attention to planning for the future.

“The company has been doing its utmost to prevent a worsening of the situation,” Tokyo Electric’s chairman, Tsunehisa Katsumata, told a news conference.

“We have put together a road map,” he said, adding, “We will put our full efforts into achieving these goals.”

On Sunday, meanwhile, the government said that evacuees who were forced to leave their homes near the Daiichi plant will be able to start returning in six to nine months, after the land is decontaminated. The announcement seemed to suggest that few places would be put off limits, as they were after the more devastating 1986 Chernobyl disaster in Ukraine. But Japanese officials did not provide specifics about how contaminated the land was within several miles of the plant.

In any case, the statements were the clearest indication yet that the tens of thousands of people evacuated from the area and living in shelters will not soon be able to return to their homes, or to towns that were destroyed by the tsunami. It also means that the badly shaken government will have to continue to provide for the displaced people even as it struggles to rebuild from the quake and stabilize the economy.

One government official and a nuclear power expert said they thought Tokyo Electric’s plan could work, although one said the company should try for a cold shutdown sooner. A cold shutdown means that the temperature of the water in a reactor is below the boiling point. Although cooling must continue, the water will not boil away quickly, even at atmospheric pressure.  Boiling must be avoided because fuel rods have to be kept under water to avoid meltdown.

The Japanese government and the company, known as Tepco, have been overly optimistic in the past. Several weeks ago, for instance, the company said it hoped that its success in bringing live power lines back to the plant would enable workers to quickly restart the existing cooling systems even though the equipment would have had to survive not just the natural disasters, but the explosions that rocked the plant in the following days.

The announcement on Sunday that new cooling systems would be built was the first admission that efforts to restart the old system had failed.

Reporting was contributed by Keith Bradsher, Ken Ijichi, Yasuko Kamiizumi, Andrew Pollack, Kantaro Suzuki and Hiroko Tabuchi from Tokyo, and Matthew L. Wald from Washington.

Article source: http://feeds.nytimes.com/click.phdo?i=7a3c7b3b773a69b69bf6bf3cbaf15229

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