We see automakers continue to climb and exceed sales. With more and particularly on meri kara, i want to bring in , i want to bring in matt miller. Matt, lets start with you. We know there is a lot of trouble that General Motors is in. What about mary barra herself . Is going to answer why she did not know about this as the chief of engineering design. Before she was made ceo, she was in a number of other leadership positions at this company. Runningently, she was hr. Before that, she was the head of product and in that role, she should have been in control of quality. Why would she not have known about this . If she did not, what does that say about her leadership . Those are the questions that people are going to be asking on capitol hill. Mary, i thinkwith a lot of people think she has handled this very contritely. It looks like she is willing to cooperate. Much differently than any of the previous ceos would have when they had into washington. General motors is going to have its own problem. This image ofover putting out for quality building, shoddy american cars and have finally won over the Automotive Media and consumers have been really impressed by their new models. These that you are looking at, no big deal. Last night, they recalled another 1. 5 million cars for steering problems. That has doubled the amount of cars they recalled last year. Together, they have about 7 million cars recalled here today. That is 10 times with a recalled last year. That is a real problem. It is. The more details that come out, infuriating it is to hear about all these problems that were overlooked. I know she has a video apology. It helped in terms of relating to consumers, but will that help run the hill . I cannot wait to hear what bob has to say about this. In a longerogized video presentation. She issued a statement yesterday where she apologizes. She is very contrived out this and she appears to want to cooperate with congress. It will be interesting to see how she sets up the new gm Going Forward. It is a new company passed a bankruptcy. She is a new ceo. On the other hand, she says she did not know about it and does not know why the ceo was not told about it. I cannot wait to see what bob says about how does the ceo of the company not know when a product is killing people. Segue intoa great the former chairman and ceo of chrysler. You have been in the seat four times. I have. Matt poses one of the most challenging questions you have been there over 30 years, is it possible that this never reached your level . Agree witht aside, i matt. She is doing a great job. It is unfortunate that as she is trying to get her arms around this willb that totally consumer. Preparing for four of these, you are head down, locked up in a room, trying to recall and recant everything that has happened during that period. It takes her off track relative to running the company, to get ready for this grilling that will go on today. How do you prepare for Something Like this . Why was that chrysler and gm when we were going through these hearings, we were heads down, in a Conference Room with a dozen or so four or five inch binders, going through every document, every email, everything that was turned over to the congressional committees so that you knew youre going to get drilled. They have armies of people going through here looking for questions to try to trip you up. Prayer mary will prepare appropriately for this. Did you not know . If you knew, why did you not do anything about it . It is hard for me to predict how that answer will come out. There are situations where things are kept at the lowest level to avoid disclosure and what have you. Im not saying that is the case, but it is possible. It did not elevate itself to the ceo. That would be unfortunate. She has taken a positive forward step in creating the Vice President s office for safety. The families. Th she has been forthcoming and open. You look at the number of documents turned over, this is a critical moment for a new ceo, particularly mary to do what she is doing. She has broken with tradition, may be prior how prior ceos would have handled it. Also with the way how gm has traditionally been run. With this whole reorganization as she is going through right now, one of the questions we were thinking about as we were preparing for the story what goes into a recall . You did not oversee any recalls that chrysler. What happens in the car company. What are the steps that take place until a car company decides we have to call the vehicles back . One of the things we did when we acquired chrysler was we installed a very senior person that has a successful track record. We were able to recruit him away from nissan. We put him in place and started weekly quality tables. We would go through our check center and find the things that were causing quality and performance problems. If anything would endanger life, that was escalated. Important partry of our culture. We did about 400 improvements in the first 90 days relative to quality, performance improvement. You have to instill that, the culture of the company, market focus, customer centric is critical. Especially if it is endangering lives of your customers. At what point do you say we have to issue a notice to our consumers . That is a big decision and not one that sheds any positive light on the company. Ofi hope today is not a case he said, see shed. She said. There ought to be some cooperative tension between those two organizations. Is the notice given to knits up first . Ntsa first . You have to notify them if you see totalitys or injuries of that kind. Fatalities or injuries. You are required to notify them. You want to work in a harmonious way with them, not in a combative way. I hope this does not create the unnecessary tension and we do not get overregulated now. The pendulum tends to swing when Something Like this happens. Hopefully we can be constructive in the committees will do their diligence and not try to catch anybody in their deposition. About the relationship between General Motors and the dealerships who have to handle these recalls . Happyssuming they are not with the fact that these recalls keep happening and their customers are angry. Forary has done a great job the dealership, relative to not creating angst against the brand. You must take care of the dealerships. They will have to handle this plethora of recalls. Regardless of how aggressive and forward she is with gm, chances are, there will be another one. There are millions of cars in the system today. Lets be careful to say we will never have another recall. That is going to be challenging. When you think of the thousands and whatand materials goes into assembling a car, it is a huge challenge to make sure everything comes together appropriately. All right, thank you. Stay with me. He will be my guest host. Moving and shaking the sour, mark zuckerberg, he has taken a huge pay cut. His salary was two about a dollar last year. His fortunes soared last year after facebook shares more than doubled. About 27worth billion. That makes him the 22nd richest person in the world. Warren buffetts salary is 100 in the year. Who is buying the tesla cars these days . The answer may surprise you. One of the best known names in whiskey wants to revitalize the brand and beat the japanese. We will be talking scots with a master distiller. Were just Getting Started on this tuesday. New jersey will become the first state in the u. S. To ban direct sales by tesla motors. Who are the people who want to buy these teslas . We break down the numbers for you. Lets talk more about tesla and cars. I want to bring back bob nardelli. You know this issue inside and out. What do you think about what elon musk is trying to do . Manna i think he is brilliant. I think he is brilliant. Brilliant in his approach. A good friend of mine in arizona travel to california. He puts his 40,000 down payment to hold a slot, goes back to arizona. The car is delivered to him on a flatbed. A technician spent an hour with him going through how to read it. Fast forward a few months later, the technician calls and says, your 12 volt battery is malfunction is not functioning appropriately. We will be there to change it. Certainly, tesla market focus, ustomer centric. It is almost like they have built a customer for life. You can only dream of that with a gm car. If you think about the Business Models we have, jack nasser tried this with ford. Direct sales why . In manufacturing, you are looking for volume to absorb your fixed overhead. All would love to have the margins that you get out of parts and service in used cars. There was always that attention to the dealer network. If you think about the dealers and their franchise agreements, statebystate, they are they have tremendous legacy and are regarded in a state that is very tough. Very powerful. Dealers are approaching this appropriately. Lets not have a massive right and lose a massive fight and lose everything, lets compromise and see what we can get done. Ohio just excepted. Limited. I am going to build a battery plant somewhere, i will do it in a federal a friendly state. There is a study out that shows statebystate where he is approved relative to limited showrooms. Some are within the nsa. No one else is doing it. Taken another approach. He looked at the Business Model and said, i have all of these dealers, i do not have to recreate a service organization, i do not have to spend a lot of capital on tools and facilities and brickandmortar. I will benefit my dealers because i will draw more traffic into my dealerships. That was the Business Model he elected. This only works for elon musk and tesla because they only sell less than 30,000 cars. If you are trying to sell 300,000 cars, you cannot do that by yourself. The question will be, if he grows the 300 taliban if he grows to 300,000 cars, ken is margin can his margin grow to the infrastructure . Does he have enough margin in the auto to be able to cover those forward costs. Sell directlyt to to customers . Is that something that automakers would like . We all think about that. If you look at what fiat did, i would like togio have a separate dealership. A compromise was that the dealer had to spend xmas and of dollars to create a studio an x mill dollars to create a studio. Working have a great relationship with those dealers. They are in place. They have invested capital. They have tremendous loyalty within the community. Team, political relationship. It is embedded. Personal front, most people do not like going to dealerships in mind cars. For most people, it is a terrible experience and they feel like theyre are being bilked out of lots of dollars. Is there something more that should be done with regulating the dealers . There have been many attempts. Maybe tesla has it right. Dramaticake something and revolutionary as what he is trying to do to try to get a compromise. I do not think it is either or. Youodays digital world, want to have options to buy the car the way you want to buy the car. Stay with me. Bob nardelli. High p, the trading has expanded. The fbi has launched its own probe. You are watching in the loop. Is losing its fizz. The slump in soda sales got worse. I answered is taking the biggest hit. Sales of coke were down about half a percent. Pepsi down more than three percent. Look at the diet versions of these colors colas. They dropped almost seven percent each. That is a huge problem. Americans want to be more healthy. They are just skipping colas entirely. Is 26 minutes past the hour. Bloomberg television is on the markets. Caffeinated with olivia sterns. Maybe youd need a little bit more soda question mark a little bit more soda. S p posted the fifth quarterly straight game. We are up about 1. 3 . The key thing investors will be watching as the isam manufacturing index. Continued growth for u. S. Manufacturing. Overseas, lets show you what is happening in the rest of the world. Stocks are rising. Airport is showing that any factoring remains near a threeyear high. Unemployment is at about 6. 7 . Stocks are broadly higher in asia. Conflicting reports on the pmi. A slight contraction, slowdown of manufacturing. The government gauge showing a slight improvement. We will be on the markets again in 30 minutes. Investigating highfrequency trading. They joined state and regulatory authorities and trying to determine if firms are guilty of insider trading. The investigation has already resulted in at least 79 convictions. Amazon is not planning a free streaming media service. They are planning to hold a media event in new york. The wall street journal had speculated that they would announce streaming tv and music video service. Malaysian authorities reiterated their belief that there was a deliberate action by somebody on board flight 372 diverted from its scheduled fight flight path. Words in the cockpit were not all right, good night, but a more formal, good night, malaysian three seven zero. Back in washington, the Obamacare Exchanges on t rack to hit 7 million. Those glitches are the latest on what has been a rocky road in enrollment. Megan hughes has a look at the timeline. Before it launched, testing showed big problems. Crashes during stress tests. On day one, only six people enrolled. By day 2, 248. Tens of thousands idled in a virtual rating waiting room. Signing off was another story. The white house announced an emergency text search tech surge. By the end of the month, only 106,000 have signed up. Most of the signups came from state rice changes. By the end of the year, obamacare moment rally. Through december, 2. 1 Million People enrolled. 1. 6 million in december alone. To 2. 4uary, it jumps million. Last week, the president announced a milestone. Is the white house on a victory lap . Not yet. You can expect to hear more on this today. I have it confirmed that they are on track to hit 7 million. No official announcement just yet. Lastow that as of 8 00 night they had 3 million visitors to the website. It was a record day as far as that goes. Number is a big achievement. That was the target enrollment goal before any of the glitches, before the enrollment began. That is an achievement and you can bet that if these numbers bear themselves out, we will hear a bit from the administration. This went through. It had no republican votes. Republicans are not buying these enrollment numbers. Memo we heard from one thing that the books are cooked on this. Two of the things that theyre looking at when it comes to these numbers, questions that they want answered, how many of these people were uninsured before enrollment or are they just switching plans. That is something that the administration has not been able to answer. The other question, have they pay their premiums. They have signed up. They have not checked up to see who is paying the insurer in companies. Those are going to be things that were going to be looking at. Thank you so much. I want to bring back bob nardelli. What is your biggest question around us . Learn how not to to introduce a program, this is this is the case. Auld you imagine if this was new platform for General Motors to launch new cars . Lessons learned here. Point number two, there were two important words used in your exchange. One was visits, the other was enrollment. Having tremendous experience in online sales, we used to track visits, but most important were orders placed. You are skeptical of these numbers . It depends on what words you are going to use. Enrollment, if you mean paid, it would be another perspective. It is a harrowing experience to get insurance. You tried to get onto the exchange . Terminated because the Insurance Company decided not to carry insurance in california. We went with a local provider, 30 increase another 30 increase, then we were notified canceledmuch of the because the policies they had did not meet with the Affordable Care act requirements. We went back out and tried to find carriers that would comply. From 160 a month to 600 dollars a month per child with a 500 deductible. I cannot tell you how many hours we spent trying to secure that. They like their doctors and to keep them, that is what we had to go through. This experience is why the republicans are making it a focal point of their campaign. Tom, a republican congressman in arkansas, when you go to his website, he is running for senate. Obamacare so bad, obama does not want it. Anger thatng on the he believes voter has against voters have against obamacare. Are there enough americans that are angry about this . Phrase,is the old politics over policy. No one argues with trying to make sure that Affordable Health care is available. That is an important thing. It is directionally right. It is the implementation, some of the controversy on how it has happened. I think changing the goalposts as we went along to make sure, i think there were a number of issues in the implementation that could have been better. I think bipartisan basis, when we have more people in the room, that we brought people in from the business community, what is the impact, how have you implemented Major Software changes relative to ernst young does this, s p does this. Stay with me. Bob nardelli, former ceo and chairman of chrysler and home depot. Bob nardelli is one of the sayness leave years that what you need to know to get ahead. Spent ve to learn to learn different customs. If you are serving that customer in that country, you have to be available. Want to take on the responsibility as a ceo and a chairman, the priority is doing the job, not so much the speed of decision. Would say they regret not making a decision sooner. I am not talking about kneejerk or cavalier. I am talking about getting the facts, getting as informed as you can from the constituents as from as many of the constituents as you can. I was told that was a big risk in my response was, not taking risk is a bigger risk given the situation. We have to listen, learn before we can meet. I only wish i had the wisdom and the experience that i have now 20 years ago. I think i would have been much more effective. Contributeduld have more to the success of the business and been a better partner to my staff. If we could all roll back time. Thank you for doing that with us. I want to talk more about management. Welch, her boss, jack wrote this piece that we highlighted yesterday. He spoke more about management and how to cultivate talent. He said one of the things that he believes people he believes companies do not do enough is Pay Attention to the hr offices. Do you agree . He has been a great friend and mentor to me. I cant think him enough for the lessons that i have learned. People look at him for management advice.