Engineers at General Motors found a way to stop ignition switches from shutting off nine years ago, but made a "business decision" not to order the partial fix to a problem that has now been linked to a dozen deaths, NBC News has learned.
Certain GM cars are vulnerable to shutting off when their keys are bumped by drivers or stressed by heavy keychains, a problem the automaker cited in recalling 1.6 million vehicles last month. Two GM executives confirmed during a lawsuit filed by the parents of a Georgia woman killed in the crash of her Chevrolet Cobalt that the company had found a partial fix for the problem in 2005—a measure that a witness for the plaintiffs estimated would have cost as little as $1 per car.
A high-level GM executive told NBC News the company was "deeply troubled with some decisions that were made in the past and is hoping to move forward."
(Read more: GM pressured to pay crash victims)
In 2005, company engineers proposed that GM keys be altered to make the opening for the key ring smaller and reduce jostling of the key. Instead of changing the keys, however, GM designed an insert that could be added to the keys. It then sent a bulletin to dealership service managers that said the insert could be provided to car owners who came in and complained about ignition shut-offs. Under the program, according to GM warranty records, fewer than 500 drivers received the inserts.
"It has to be money," said Beth Melton, mother of Brooke Melton, who died in a crash on her 29th birthday in 2010. "It has to come down to money but that really doesn't even make sense to me. In the end, they're going to have to pay for it. They need to care about their customers. They need to care about human lives."
NBC News has examined depositions and internal GM documents from the Meltons' suit, which the Meltons settled with GM for an undisclosed sum.
During testimony, GM engineer David Trush, who helped implement the insert fix, called the insert a "good solution" for a "very small population" affected by the problem.
"We put the solution out in the field," said Trush, "the solution that would solve some of the stuff."
The Meltons' attorney, Lance Cooper, then asked witness Gary Altman, who was GM's program engineering manager for the Cobalt in 2004 and 2005, if it was true that the car company "made a business decision not to fix this problem and five months later sold [Brooke Melton] a vehicle with the problem."
GM's lawyer objected, but Altman answered, "That is what happened, yes."
Altman said that the company had not mandated the change for all vehicles because it was only a partial solution. Altman also agreed, however, that if GM had felt that changing the key was a 100 percent fix, it would have spent the money to do it.
An engineer hired by the plaintiffs as an expert witness claimed in his testimony that internal GM documents showed that GM had estimated the cost per car of making the change would be less than $1.
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Altman called the key insert "a directional improvement" rather than "a fix to the issue." He said, however, that it had probably been represented to consumers as "a fix."
He also said that he didn't believe Melton's car was "unsafe," and that it "could still be maneuvered to the side of the road."
Altman and Trush declined repeated requests from NBC News for comment. Outside his home in suburban Detroit, Altman said, "I can't answer that question" when asked why GM had not issued a vehicle recall till 2014.
Testimony during the case also revealed that GM made incremental changes to a part inside the ignition switch starting in 2005. It did so without telling consumers.
GM has now disclosed to federal regulators that it knew of problems with its ignition switches as early as 2001, during preproduction for the Saturn Ion. The automaker had earlier told the National Highway Traffic Safety Administration that it had learned in 2004 that if a driver jostled the ignition switch in a 2005 Cobalt it might shut down the engine.
GM declined to answer specific questions about the Melton case.
In February, GM announced the recall of 1.6 million vehicles worldwide from the model years 2003 to 2007 because of an allegedly defective ignition switch. The models recalled include the Cobalt, the Pontiac G5, Saturn Ions and Chevrolet HHRs as well as the Solstice and Sky sports cars. Recalled years vary for each model.
(Read more: GM suggests key ring swap after recall)
According to GM's figures, the defect has been linked to 12 deaths. Brooke Melton's death is not among the deaths GM listed.
"If it's caused one single death, to me that's enough," said Ken Melton, Brooke's father. "One single death is enough to make a recall."
Although the Meltons have settled with GM, their suit against the dealership that sold their daughter the Cobalt remains active.
—By NBC News' Gabe Gutierrez, Rich Gardella, Kevin Monahan and Talesha Reynolds