Takata Corp's company plate is seen at an entrance of Takata headquarters in Tokyo December 9, 2014.YUYA SHINO/Reuters
Takata Corp., the maker of air bags that have been linked to at least five deaths in the U.S., will double the number of cars that will be repaired to 34 million and submit its parts to government testing as part of an agreement with investigators.
"This is the most complex consumer safety recall in U.S. history," U.S. Transportation Secretary Anthony Foxx said.
In a consent order, Takata agreed to make the recall nationwide and cooperate with investigators probing the cause of the failures. The auto recall – the largest in the agency's history – includes cars from 11 automakers.
The company has accrued more than $1-million in penalties, and additional fines are possible.
The agreement is an attempt to resolve a global auto-safety crisis involving air-bag inflators that may deploy with too much force, breaking apart and sending shards of metal and plastic into the passenger compartment of vehicles. Takata, its automaker customers and U.S. regulators have had trouble getting to the root cause of the problem, and millions of customers are still unable to get their cars fixed because of a shortage of replacement parts.
Regulators had accused Takata of failing to cooperate with their investigation into the faulty air bags, which have been linked to six deaths worldwide and more than 100 injuries.
"Takata should have been much more aggressive before now in protecting passengers through a national recall," said Senator Richard Blumenthal, a Connecticut Democrat. "In the meantime the Department of Justice should be taking appropriate action to investigate and impose penalties."
Potential Fine NHTSA has been pressuring Honda Motor Co., Nissan Motor Co. and eight other automakers affected by the recalls to speed the repair process and work with other air-bag suppliers to obtain parts. The agency also has demanded that Tokyo-based Takata turn over more documents and data from the devices that have been removed from the recalled cars.
NHTSA in February began fining Takata $14,000 a day for not completely answering questions about air-bag inflater production and company efforts to investigate the explosions. It said at the time that most of the 2.4 million pages of documents the company had produced didn't actually relate to the agency's specific inquiries.
The agency become more aggressive since it was lambasted by Congress for failing to be more active prior to last year's revelation that about 2.6 million General Motors Co. cars had a known ignition-switch defect that went unrecalled for years.
"NHTSA has done a 180-degree turn on how they're handling these safety investigations," Kevin Dean, who represents plaintiffs in several air bag lawsuits, said praising the agency. The recalls still may not go far enough, he said.
Ammonium Nitrate Modern air bags, credited by NHTSA with saving more than 2,000 lives per year in the U.S., rely on small chemical reactions to safely inflate in milliseconds when sensors detect a crash. Takata's trouble has been linked by safety advocates and victims' lawyers to the company's choice of chemical propellant, a type of ammonium nitrate that can be rendered unstable by high humidity and moisture.
In a properly operating device, gas created by an electrical charge is released through holes in a metal canister to inflate the air bag. If the chemical propellant tablets are made improperly or have degraded because of moisture, they vaporize with too much pressure, potentially resulting in a burst canister that hurls metal and plastic shards through the air bag and toward the driver and passengers.
"All of us have to do fact-checking to make sure they're getting every vehicle with ammonium nitrate-based inflators, because they're subject to deterioration over time," Dean said.
National Recall One of the main disputes between Takata and NHTSA had been over whether to initiate a national recall for some drivers' side air bags. The company had said the defect was tied to high humidity, and it supported recalls limited to southern U.S. states with tropical weather.
Since then, all the automakers with cars that have Takata air-bag inflators have taken it on themselves to begin national recalls. There have also been recalls for defects in the passenger-side air bags as well.
In addition to Honda and Nissan, Takata's other affected customers in the U.S. market are units of Fiat Chrysler Automobiles NV, Toyota Motor Corp., Bayerische Motoren Werke AG, Mazda Motor Corp., Ford Motor Co., General Motors Co., Fuji Heavy Industries Ltd.'s Subaru and Mitsubishi Motors Corp.
Maximum Fines Carmakers and parts suppliers face fines of $7,000 per day for not abiding by a U.S. law known as the Transportation Recall Enhancement, Accountability and Documentation Act, which requires the companies to tell regulators about customer injuries, lawsuits, warranty claims and complaints.
The maximum civil penalty is capped by Congress at $35-million. Because NHTSA issued two special orders to Takata, the company faces a combined fine of $14,000 a day, with a final maximum penalty of $70-million. The daily fines have been suspended as part of the consent order as long as Takata cooperates with the investigation.
"The penalties under the statute have been way too low," Blumenthal said. "Either legislatively or judicially the laws should be reformed."