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Takata Doubling Recall for Defective Air Bags to 34 Million Vehicles
Tuesday, May 19, 2015 04:33 PM
By: REUTERS
Japanese air bag manufacturer Takata Corp is doubling a recall of air bags to nearly 34 million vehicles, creating the largest automotive recall in American history, U.S. safety regulators said on Tuesday.
The recall, which still does not identify the cause of the problem, involves passenger and driver-side air bags in vehicles made by 11 automakers, the U.S. Department of Transportation, the National Highway Traffic Safety Administration and Takata said. It expands on the 16.6 million vehicles called back for repairs for the same issue in previous regional and national recalls.
Takata Chief Executive Shigehisa Takada said in a statement: "We are pleased to have reached this agreement with NHTSA, which represents a clear path forward."
Under pressure from U.S. safety regulators, Takata agreed to the expanded recall. It had previously resisted expanding the recalls, saying the defect cited by automakers was not "officially recognized." ]
Transportation Secretary Anthony Foxx said NHTSA also issued a consent order to Takata, requiring the supplier to cooperate in the safety agency's ongoing probe as well as any oversight.
NHTSA also said it will "organize and prioritize the replacement of defective Takata inflators" under its legal authority.
"We will not stop our work until every air bag is replaced," Foxx said.
Foxx and NHTSA's new administrator, Mark Rosekind, have been more aggressive in tackling auto safety issues. On Monday, NHTSA escalated a running regulatory battle with Fiat Chrysler Automobiles, saying it could impose "multiple penalties" on the automaker and order a public hearing to examine FCA's handling of 20 recalls affecting more than 10 million vehicles.
Takata's recall will cost the supplier and its automaker customers an estimated $4 billion to $5 billion, said Scott Upham, president of Valient Market Research, which tracks the air bag industry.
A Honda Motor Co Ltd spokesman had no immediate comment on how the replacement air bag inflators will be produced for such a large number of vehicles. Industry officials have turned to Takata's rivals for help in obtaining replacement parts.
Takada, whose family founded and controls the supplier, said analysis of the problem "was not within the scope of testing specifications" set by its automaker customers.
"While it's taken far too long, Takata finally seems to be owning up to the air bag crisis that has plagued vehicles of all shapes and sizes," said Kelley Blue Book analyst Akshay Anand. "A recall of this size is unprecedented in any industry."
U.S. lawmakers, who had pushed for a broader recall, praised the news.
"Folks shouldn't have to drive around wondering if their air bag is going to explode in their face," Florida Democratic Senator Bill Nelson said. "Let's hope Takata's admissions today tell us the whole story."
The number of vehicles with potentially defective Takata air bags recalled globally since 2008 has risen to around 36 million following recalls over the past week by Japan's Toyota Motor Corp, Nissan Motor Co Ltd and Honda.
The automakers have said that they decided to proceed with their recalls after finding some Takata air bag inflators were not sealed properly, allowing moisture to seep into the propellant casing. Moisture damages the propellant and can lead to an inflator exploding with too much force, shooting shrapnel inside the vehicle.
Six deaths have been linked to the defective air bags, all in cars made by Honda, which has borne the brunt of the Takata recalls to date and which gave a disappointing profit forecast last month due to higher costs related to quality fixes.
Takata faces multiple class actions in the United States and Canada as well as a U.S. criminal investigation and a regulatory probe.
News of the recall on Tuesday was initially reported by the Detroit News.
