Takata Recalls 34 Million Vehicles

Due to problems with airbag inflators, the Japanese airbag manufacturer Takata Corp is now recalling roughly 34 million vehicles, marking the largest automotive recall in American history. This recall, which still doesn’t identify the root cause of the problem, involves passenger and driver-side airbags in vehicles made by 11 automakers.  It expands on earlier regional and national recalls for the same issue, but Takata expanded the recall under pressure from US safety regulators.

Transportation Secretary Anthony Foxx said that the National Highway Traffic Safety Administration (NHTSA) entered into a consent order to Takata, requiring the supplier to cooperate in the safety agency’s ongoing probe in addition to any oversight.  NHTSA also said that it plans on organizing and Dennis Cuneo Takataprioritizing the replacement of defective Takata inflators under its authority.  Foxx described the recall as “probably the most complex consumer safety recall in U.S. history”.  Foxx and NHTSA’s new administrator, Mark Rosekind, have been tackling auto safety issues with a renewed focus.  Yesterday, NHTSA escalated a running regulatory battle with Fiat Chrysler Automobiles, saying that it could impose “multiple penalties” on the automaker and order a public hearing to examine FCA’s handling of 20 recalls affecting over 10 million vehicles.

The Takata recall could end up costing an estimated $4-5 billion.  Automakers have started turning to Takata’s rivals, such as Autoliv, for help in obtaining replacement parts.  A group of ten automakers are working together to determine the root cause of the air bag ruptures, which appear to be related to high humidity and moisture.

US lawmakers, who had been pushing for a broader recall since the issue first appeared, have praised the news of this new larger recall.  Since 2008, the number of vehicles with potentially defective Takata airbags recalled globally has risen to around 36 million.  Automakers have said that they’ve decided to proceed with their recalls after learning that some Takata airbag inflators weren’t properly sealed, allowing moisture to seep into the propellant casing.  Moisture damaging the propellant can lead to an inflator exploding with too much force, shooting shrapnel inside the vehicle.  In addition to the regulatory probes, Takata faces multiple class action lawsuits.

Dennis Cuneo

Dennis Cuneo is a seasoned automotive executive, with a large scope of experience gained through a career that has spanned law, business and economic development. Formerly serving as the Senior Vice President of Toyota Motors North America and trial attorney in the Department of Justice, he currently sits and has on the Boards of numerous trade organizations, economic development groups, and research groups.

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