The National Highway Traffic Safety Administration said Wednesday night that it opened the probe "to determine whether GM properly followed the legal processes and requirements for reporting recalls."
The agency has the authority to fine GM as much as $35 million under legislation that went into effect late last year. The previous maximum fine automakers faced per incident was $17.35 million. Automakers must report evidence of safety defects within five days of discovering them.
On Tuesday, GM doubled the number of cars in the recall for faulty ignition switches. The problem has been linked to 31 front-end crashes that caused the 13 deaths. The company also issued a rare apology, saying its process to examine the problem was not robust enough when it surfaced about a decade ago.
A chronology of events filed Monday with NHTSA by GM show it knew of the problem as early as 2004.
Since undergoing a painful bankruptcy in 2009, GM has removed layers of bureaucracy, improved the quality of its vehicles and is quicker to issue recalls when problems occur. However, its admission that its procedures were lacking 10 years ago shows how the old culture can still haunt the automaker.
"The chronology shows that the process employed to examine this phenomenon was not as robust as it should have been," GM North America President Alan Batey said in a statement. "Today's GM is committed to doing business differently and better."
On Feb. 13, GM announced the recall of more than 780,000 Chevrolet Cobalts and Pontiac G5s (model years 2005-2007). Then on Tuesday, it doubled up, adding 842,000 Saturn Ion compacts (2003-2007), and Chevrolet HHR SUVs, Pontiac Solstice and Saturn Sky sports cars (2006-2007). Most of the cars were sold in the U.S., Mexico and Canada.
GM says a heavy key ring or jarring from rough roads can cause the ignition switch to move out of the run position and shut off the engine and electrical power. That can knock out power-assisted brakes and steering and disable the front air bags. In the fatalities, the air bags did not inflate, but the engines did not shut off in all cases, GM said.
It was unclear whether the ignition switches caused the crashes, or whether people died because the air bags didn't inflate.
According GM's chronology, the company knew of the problem as early as 2004, and was told of at least one fatal crash in March of 2007. GM issued service bulletins in 2005 and 2006 telling dealers how to fix the problem with a key insert, and advising them to warn customers about overloading their key chains. The company's records showed that only 474 vehicle owners got the key inserts.
GM thought the service bulletin was sufficient because the car's steering and brakes were operable even after the engines lost power, according to the chronology.
By the end of 2007, GM knew of 10 cases in which Cobalts were in front-end crashes where the air bags didn't inflate, the chronology said.
GM's chronology also shows that NHTSA knew about the problem and a fatal accident in March of 2007. In its investigation, NHTSA likely will try to find out if GM withheld information or was slow to produce it.
In 2005, GM initially approved an engineer's plan to redesign the ignition switch, but the change was "later canceled," according to the chronology.
GM spokesman Alan Adler said that initially the rate of problems per 1,000 vehicles was too low to warrant a recall. But he said safety information was kept in different places in the company 10 years ago.
GM has hired an outside law firm to find out what went wrong in the ignition recall case. But Adler wouldn't say whether the firm will look into other safety and process problems that occurred around the same time. "We are focused on this case," he said.
GM also said Wednesday that it will send letters to all 1.6 million owners starting March 10 telling them to use only the key in the ignition until repairs are made. Anyone with ignition problems should contact dealers. Another letter will go out in April telling people they can take their cars in for repairs.
If General Motors Co. is fined, it will be the third automaker to face significant penalties for being slow to report safety problems to NHTSA. From 2010 through 2012, Toyota Motor Corp. paid a series of fines totaling more than $66 million for delays in reporting unintended acceleration problems. Ford Motor Co. last year paid $17.35 million for being too slow in reporting sticky gas pedals in some Escape SUVs.