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Anchored by Jake Tapper, The Lead airs at 4 p.m. ET on CNN.

Anchored by Jake Tapper, The Lead airs at 4 p.m. ET on CNN.

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April 2nd, 2014
05:37 PM ET

Analysis: GM will suffer long-lasting damage to its image because of recall

(CNN) – General Motors sales did not take a big hit in the wake of its recall scandal, topping analysts' expectations Tuesday.

While the financial toll will "not be crippling" for the company, the damage to GM's brand will be long-lasting, says Reuters managing editor Paul Ingrassia, author of "Engines of Change."

"In terms of their image and reputation, which is a huge part of selling cars ... this is going to be a problem, I think, for a long time," says Ingrassia.

The recall will also be a drain on the time and attention of senior management.

"Instead of focusing on, you know, how do we develop new cars for the marketplace, how do we get the better of Toyota, and Ford, and all that sort of thing, they're going to be tied up in legal proceedings, Congressional hearings," said Ingrassia.

It has been five years since the bankruptcy and bailout of GM. But the latest scandal indicates there are still systematic problems within the company.

CEO Mary Barra told lawmakers that there is a new culture at GM, but "what's the proof?" says Ingrassia.

"It's one thing for a CEO to get up and say, 'We do have a new culture.' But it's another thing for the company to fundamentally changes its ways of behavior," said Ingrassia.

For more of our interview with author Paul Ingrassia, check out the video above.

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