james21_h

"equivalent to more than a quarter of the vehicles on US roads"
<https://www.theguardian.com/business/2016/may/04/takata-airbag-recall-doubled-cars>

JT4

Congrats, it looks great!!

JT4

I agree in that even after the drivers side is fixed, I still have my doubts that the car is 100% safe, I am really having a problem trusting Honda/Acura at this point because of all of the info that keeps coming out. And if I decided to drive the TL knowing that there is a very serious safety defect well that's my call. But if I was to knowingly drive passengers around well then shame on me.

And the other thing that IMO people are overlooking. You could be the best driver in the world, and maybe you don't live in one of the high risk, high humidity areas. But what happens when some jerk blows a stop sign, and you T-Bone him and your vehicle still has one of the old defective inflator's in it?

ctresky

Update: Just got my 09 TL fixed to at Rosenthal Acura in Maryland. Their service was great and I appreciated the rental. Saved close to 4000 miles on my Acura.

I will say they are offering to by people's vehicles once they are fixed because the used inventory is down. I was offered around 15k for mine.

Cheers.

ressuhd

So I have the exact same issue here in Illinois. I kept my vehicle (both at the request of my dealer for lack of space and because I didn't want my TL sitting outside for six months), and had to park the rental outside. Hail storm in March damaged the vehicle. Fast forward to early May and I get a call from Acura saying my part is ready and to get it fixed/return the rental ASAP. When I returned the rental to Enterprise they found the damage.

I received the damage letter from Enterprise today and called Acura Client Relations and explained the issue and asked where to send the documentation from Enterprise. After being on hold for at least five minutes, lady came back and said unfortunately Honda is not authorizing payments other than daily rental fees. I explained that a.) Acura made a car with a defective airbag; b.) my dealer asked that I keep my car at home which necessitated the rental being outdoors; and c.) I can't control the weather to no avail. I asked for a supervisor to call me back. In the meantime I'll be contacting my local dealer and reaming them out.

Let me know how yours turns out!

atl7

Lol tragic, you had to be on hold for 5 minutes?? How would you expect her to know your whole situation off the top of her head and immediately know the answer to your problem. ACR lady is just doing her job. The Enterprise insurance is well worth it or adding on rental insurance to your insurance policy. Unfortunately, odds don't seem to be in your favor in this whole situation, at least on paper. But maybe Acura will help you out though.

ressuhd

I know she was doing her job, and in fact she seemed very genuine in her understanding if the situation but couldn't do much herself, hence my request for a supervisor. Enterprise (or any rental car co.) physical damage insurance is not worth it at all since most auto policies provide coverage (if you have physical damage coverage, of course). Credit cards often offer that coverage, also. I have coverage on my own policy, but I do not feel I should be subject to paying a comp deductible for something that was completely out of my control in all respects. Judging by the feed I'm not the only one that feels the same. Hopefully somebody feels my pain that can make that decision!

AJW24

Anymore word on the passenger and side air bags? I mean it's common sense that they all could be takata but you never know.

CTNYC

If I may ask, what are the details about your car? (Trim and mileage) I'm in the DMV area myself and have been toying around with the idea of upgrading, but haven't been able to justify the cost, but if I'm able to get top dollar, maybe I can justify it

4GCEL28

Just went to my dealership to grab a rental because I am getting a tad impatient with getting the issue resolved (I imagine they'll give those with rental cars priority to reduce expenses). Dealership told me Enterprise is no longer supporting Acura in the area so I am now with Hertz. Supposedly allowed to grab anything off the lot so we reserved a large SUV ahead of time for enjoyable Memorial Day weekend car (driving from bay area to southern California).

ctresky

Not at all and great question. I have a 2009 SH-AWD with about 86k. I do have the tech package. The car is the platinum/grey color with the light interior. The only thing I have done to the car was put in Weather tech floor mats. If you are interested in more information, DM and I am happy to provide the sales persons contact information.

james21_h

Got my driver airbag replaced today at the dealership. It only took 20 minutes!! I asked them about the passenger side airbag, they said they haven't heard anything. I bet they called those customers who have rental cars first. My rental bill was $3600 for 70 days and saved me 3000 miles. I guess when they say the passenger bag is bad as well, we will be asking for another rental car again!!

AJW24

that's strange, weird that "only" the drivers side is a problem. Is it certain cars that have this air bag problem going by VIN or the whole class of 09-14

andysinnh

If I were to go on vacation and get a rental, I'd either reject the supplemental insurance and then treat the car as my own (same insurance deductible, same responsibility to report to insurance and handle as if it were my car), or I'd get the supplemental which would cover any delta in cost, and also allow me to just hand they keys back as they took care of the repair. So while 99 percent of us just reject the additional insurance, there are benefits in regards to the hassle should you have a claim.

In regards to having Acura pick up the repair since you had to leave your rental outside - what if you were driving home and hit hail and had similar damage. Same logic? And what if your car were stored on the dealer's lot and it got nailed by hail and your rental was in the garage? Your insurance would have covered your car, correct? I guess I'm just trying to understand how much you're expecting Acura to do here beyond the major $$ they spent on a rental to give you a safe car to drive while you waited for the repair.

AJW24

that's strange, weird that "only" the drivers side is a problem. Is it certain cars that have this air bag problem going by VIN or the whole class of 09-14

CTNYC

Ah- Sounds like its ~$1k above wholesale value then... Not a bad deal if you're interested in trading up I guess, but not enough to change my mind... We'll see if Pohanka wants to practically give away a TLX (Maybe serve as my second car) at the end of the year to make their sales quota

Treblig

Well, my TL is finally back on the road and the rental car is back with Enterprise. My driver's side airbag was replaced on Saturday and the car given a once over since it has sat for a while. Given a clean bill of health it was great driving it again!

JT4

^^ Good to hear, still waiting patiently on mine...

lexrid

As of this morning, my drivers side inflator has been replaced and I'm officially back in my TL. Didn't realize how much I missed driving it until now. Exactly 5 weeks in a rental at the cost of $1,619.45 and 2,064 miles.

lil12002

Why are most of you being put in a rental to fix the airbags isn't it a quick fix? Does it really take several days to fix?

james21_h

That's because the part is not AVAILABLE for every single car they are recalling!!! They are slowly getting the replacements. So far 70 million cars are affected and maybe more.

WNY PAT

I've been in my rental (2016 Cadillac XTS) for 6 weeks. 4500 miles and counting.

a35tl

My experience is virtually the same as yours. Had the rental 5 weeks and 1 day. Put over 2100 miles on it. Got my TL repaired this afternoon. Took about an hour. My rental car was a '15 Camry that was very plain and generic. Getting back into my TL has rejuvenated my joy of driving. It's almost like getting a new car. It is so good to be driving it again!

crxb

Takata hires financial adviser to mull restructuring options


http://www.autonews.com/article/2016...oreUserAgent=1

UPDATED: 5/25/16 6:29 pm ET - adds company statement
WASHINGTON -- Takata Corp. hired investment bank Lazard to lead a financial restructuring and help resolve costs stemming from its recall of tens of millions of faulty airbags linked to at least 13 deaths and more than 100 injuries worldwide.

Takata's board of directors in February named an outside steering committee to develop a comprehensive restructuring plan to address the financial and operational issues related to its recall of the defective inflators.

The outside committee said it retained Lazard as it is "expeditiously seeking new investment for Takata," the committee said in a statement.

Takata, which posted a net loss of $120 million (13.1 billion yen) for the year ended in March, potentially could face billions of dollars in costs related to the recall.

Hideaki Sudo, chairman of Takata's committee and partner at Tokyo Fuji Law office, said in a statement it has been in talks with automakers "to reach a consensual resolution that addresses the costs of the inflator issues while enabling Takata to remain a viable and valued global supplier."

Earlier this month, Takata said it was considering a drastic review of its inflator division and the sale of non-core businesses.

The committee is also working to reform Takata's governance structure, and to ensure the equitable treatment of claims for all automotive customers, the statement said.

Earlier this month, the Transportation Department and Takata confirmed that 17 automakers will recall another 35 million to 40 million U.S. airbag inflators by 2019 -- on top of 28.8 million recalled previously.

The company is actively working to avoid a bankruptcy restructuring, a person close to the company said.

The company latest annual loss was its third in four years because of an increase in recall costs. Reuters reported that if Takata was found to be solely responsible for the problem, it could face a bill of more than $9 billion in recall costs, based on a rough calculation that each replacement kit costs around $100. It also faces numerous U.S. lawsuits, including a suit filed earlier this month by the state of Hawaii. The company also faces an ongoing criminal investigation Justice Department investigation.

In April, Reuters reported Takata had begun looking for a financial backer and planned to draw up a list of candidates by August, citing two people familiar with the matter.

In November, Takata agreed to pay a $70 million fine for safety violations and could face deferred penalties of up to $130 million under a settlement with the U.S. National Highway Traffic Safety Administration.

NHTSA named John Buretta, a former official in the Justice Department's criminal division, in December to serve as an independent monitor overseeing the Takata recalls.

Takata is a major supplier of auto safety equipment including airbag, seat belts and child restraint systems -- with 46 plants in 17 countries.

Contact Automotive News

JT4

^^ It was only a matter of time before this news came out...

RKEnnis

Acura has refused to cover my hail damage. My dealer has refused as well, so I'm stuck doing an insurance claim.

If I HAD been out driving my rental at the time of damage, I'd expect to be liable. But I wasn't - MY car was parked in my garage space, and the only other place to park the rental was outside. The storm came in the middle of the night, so the car was NOT being driven.

Acura put me in the position of having a vehicle I couldn't store in a protected place. This was NOT my doing. So yeah, I'd expect them to pay for the damage.

Same goes for if they HAD taken it to their lot - if it got hail damage under their control, THEY would be liable.

Acura makes a ton of money selling cars. Their dealerships make a fortune screwing their customers on repairs.

THEY installed defective air bags. Now THEY have to pay the cost - that is, until their inevitable damages payout from Takata.

So again, yeah. I think they SHOULD pay for whatever damages occurred to the rental * that were outside of my control * !

RKEnnis

Dang, that's at or below dealer trade in blue book value in my area. :/
I'm in south Texas.

RKEnnis

Agreed! At this point I'm pretty certain ALL the airbags in my car are Takata.

I'm really pissed at Acura for deliberately hiding the manufacture name for the rest of the air bags in our cars. They know full well who they were made by, but they just wont say!

I'll be forced to maintain this vehicle while I have it. Other than parts for the car I already own, Honda/Acura will never get another dime from me.

Crappy service from my local dealer got me most of the way here, and this recall was the nail in the coffin regarding Acura.

Never Again!

Bruce_Wayne

While I perfectly understand a bad dealer relationship requiring termination...

I do want to point out that the recall, itself, has affected basically every major car manufacturer there is. Takata airbags are used in tons and tons and tons of cars... not just Acura and Hondas.

Even if you jumped ship to Ferrari, you're not safe:

So, blaming a car manufacturer for Takata's fault isn't quite fair... unless you want to blame ALL car manufacturers for choosing to use Takata to begin with.

Of course, blaming a dealership for a bad relationship still holds water

My point is the recall is not Honda's fault. It's takata's. And it's affecting every major manufacturer. In fact, it seems Honda is handling it appropriately by giving out loaners.

SilverJ

Your giving Honda way too much credit.

1st)First off, the number of Honda/Acura cars that have the bad airbags dwarfs all of the other manufacturers.

2nd) Honda KNEW these airbags were a problem (goes all the way back to 2004) and CONTINUED to install them. See the link to the lawsuit I posted a few pages back.

3rd) The Senate, STRONGLY SUGGESTED honda provide transportation to affected customers. It was not just a good will gesture.

Honda/Acura screwed up big time here. And most of it was their fault. Not for initially choosing but for continuing to use Takata.

DidiBob

Question regarding the battery in my car. I had the Acura 100month worthless battery. It tested poorly in March when I requested a loaner / had my car stored temporarily at the dealer. They said it was not poor enough to fail. Well. The battery failed. I purchased a new one. Interstate of course. The dealer said if anything happens to our cars due to long term storage, they would address the issue case by case. What are the odds of getting either the dealer or client relations to follow through on that statement? So far their customer service at client relations blows. That's being polite lol.

james357

iTrader: (2)

1. What are the proportions of automobiles sold per brand and those recalled? Thanks a more realistic representation of the issue. Look at sales numbers too not just cars affected.

2. If Honda/Acura knew, whats to say that others didn't know and were just able to keep their mouths shut better?

3. The senate....yeah ok. Still isn't cool Acura gave me a loaner and my buddy with a BMW M3 is stuck still driving his death trap.....give credit where its due even if it was forced.

All in all, I'll still buy Acura. Takata is a HUGE manufactuer....the damn loaner car I'm in now has a Takata tag on my seatbelt....yall think that helps me feel much safer? hahaha

SilverJ

Believe whatever makes you feel comfortable in your Acura. If you read the court document I posted you will see what I said is accurate. But if you want to dismiss the facts, have at it.

Bruce_Wayne

Honda (approximately 10.7 million, including Acura): 2001–2007 Accord (four-cylinder), 2001–2002 Accord (V-6), 2008–2011 Accord; 2001–2011 Civic; 2002–2011, 2016 CR-V; 2002–2004 Odyssey; 2003–2005 Civic Hybrid; 2003–2011 Element; 2003–2011 Pilot; 2006–2010 Gold Wing motorcycle; 2006–2014 Ridgeline; 2007–2014 Fit; 2010–2011 Accord Crosstour; 2010–2014 FCX Clarity; 2010–2014 Insight; 2011–2015 CR-Z

Infiniti: 2001–2004 I30/I35; 2002–2003 QX4; 2003–2008 FX35/FX45; 2006–2010 M35/M45

Jeep: 2007–2012 Wrangler

Lexus: 2002–2010 SC430; 2006–2011 IS; 2007–2011 ES; 2010–2011 GX

Lincoln: 2006–2011 Lincoln Zephyr and MKZ; 2007–2010 Lincoln MKX

Mazda (more than 730,000): 2003–2011 Mazda 6; 2006–2007 Mazdaspeed 6; 2004–2011 RX-8; 2004–2006 MPV; 2004–2006 B-series; 2007–2011 CX-7 and CX-9

Mercedes-Benz (1,044,602, including Daimler): 2005–2014 C-class (excluding C55 AMG but including 2009–2011 C63 AMG); 2007–2008 SLK-class; 2007–2014 Sprinter; 2009–2012 GL-class; 2009–2011 M-class, 2009–2012 R-class; 2010–2017 E-class sedan, wagon, coupe, and convertible; 2010–2015 GLK-class; 2011–2015 SLS AMG coupe and roadster

Mercury: 2006–2011 Milan

Mitsubishi (more than 105,000): 2004–2007 Lancer and Lancer Evolution; 2006–2009 Raider

Nissan (more than 1,091,000, including Infiniti): 2001–2003 Maxima; 2002–2004 Pathfinder; 2002–2006 Sentra; 2007–2011 Versa

Pontiac (approximately 300,000): 2003–2007 Vibe

Saab: 2003–2011 9-3; 2005–2006 9-2X; 2010–2011 9-5

Saturn: 2008–2009 Astra

Scion: 2008–2011 xB

Subaru (more than 380,000): 2003–2005, 2009–2011 Legacy and Outback; 2004–2011 Impreza; 2005–2006 Baja; 2006–2011 Tribeca; 2009–2011 Forester

Toyota (approximately 4,697,000, including Lexus and Scion): 2002–2007 Sequoia; 2003–2011 Corolla and Corolla Matrix; 2003–2006 Tundra; 2004–2005 RAV4; 2006–2011 Yaris; 2010–2011 4Runner; 2011 Sienna

Volkswagen (680,000): 2006–2010, 2012–2014 Passat; 2009–2014 CC; 2010–2014 Jetta SportWagen and Golf; 2012–2014 Eos; 2015 Tiguan


So yes, you're right, Honda has 6M more affected cars than the next manufacturer (Toyota at 4.7M).

But, that doesn't change the fact that every manufacturer has been affected by this. Throw in another 1.9M for Ford today because they just recalled for Takata airbags on the passenger side airbag.

If Honda chose to use these airbags with evidence that they were dangerous going back years, well then yes, that's certainly a problem.

But after that, what do you expect them to do? They contributed to a problem and are doing something about it. I'm not sure everyone else driving other cars by other manufacturers are getting loaners, are they?

While you're less likely to be affected by this huge recall driving another car, the point remains that you're not much safer. I have no doubt every manufacturer was well aware of your court documents and they all apparently continued using Takata airbags as well in X number of cars.

sockpuppet

Where did you post a court document? Are you referring to the link to an "Automotive News" article about a lawsuit? Surely you understand the 2 are not the same.

Acura has responded, at great cost, to this issue (which was the result of a third party product). And before any deaths have arisen, as near as I can tell, though perhaps I'm wrong on that. Many of the posts on this thread seem to be moving towards bragging about how many miles have been put on (free) rentals. But still, you want more.

Go ahead...keep grinding your ax.

SilverJ

If wanting a safe car to drive friends and family in and full disclosure on what potentially dangerous parts may be in my car is what you consider "grinding an Ax", then maybe you should educate yourself a bit more on the topic.

Allow me to inform you.
http://www.labaton.com/en/cases/uplo...-Complaint.pdf

WNY PAT

My dealer called today and told me the new airbag is in. I dropped the TL off tonight and will be picking it up tomorrow afternoon. They are throwing in a free wash and interior detail for the inconvenience. As far as my satisfaction goes, I think my dealer has been great. They always have been. Whether Acura is on the up and up with other Takata inflators possibly in my MDX (I suspect that will be recalled next) or whether the passenger or side air bags will eventually need to be replaced is up for debate I guess. I do know that I was provided a nice loaner (2016 caddy XTS) at no cost to me. I put nearly 5,000 miles on it and Acura is picking up the tab. It also saved me test driving a CTS or XTS in the future. The CUE system is wonky and the build quality isn't what the TL's is. The Bose sound system is fair but sounds second rate compared to the ELS. And of course the TL leans more towards sport than luxury and I much prefer that on the road. All that being said, the Caddy seats were nice, the Apple Play is generations ahead of what's in the TL and the Nav system was somewhat better. The seamless talk to text is probably the feature I'll miss most going back to the TL from the Caddy. In 15 years, the XTS might fit the bill for me. It was certainly a nice ride.

crxb

http://www.latimes.com/business/auto...nap-story.html


saved $5

"translating into Takata pricing its air bags at around $5 less than competitors, he said.

That’s big savings for carmakers when multiplied over tens of millions of vehicles."



"Cars with potentially deadly Takata air bags are still being made and sold"

Cars with potentially deadly Takata air bags are still being made and sold - LA Times


Sen. Bill Nelson (D-Fla.), shown in 2014 with a Takata air bag, wants automakers to replace the potentially deadly inflators before the cars are sold so they don't have to be recalled. (J. Scott Applewhite / Associated Press)
Shan Li
At least four automakers continue to sell new vehicles equipped with faulty air bag inflators from Takata Corp., which has become embroiled in the largest automotive recall in history, according to a Senate report.

The carmakers – Toyota, Vokswagen, Fiat Chrysler and Mitsubishi – are selling some vehicles from the 2016 and 2017 model years that include inflators that have already been linked to at least 11 deaths around the world, according to the report released Wednesday.

“Consumers are buying new cars and not realizing they’re going to be recalled,” the report’s author, Sen. Bill Nelson (D-Florida), said in a statement. “These cars shouldn’t be sold until they’re fixed.”

The roll-out of new cars with faulty air bags will prolong what is already a complex recall involving as many as 69 million inflators in the U.S. That automakers are continuing to produce vehicles equipped with the problematic inflators, experts said, reflects an industry that has been driven to make a difficult choice: stop making cars altogether until overtaxed air bag makers can produce safer inflators, or install faulty air bags fully knowing they will be recalled at a later date.

So far, all automakers have chosen the latter.

The problem stems from a dearth of supply in the air bag industry, which has faced years of consolidation as carmakers grew around the world.

The industry will have to hustle for years before it can manufacture enough parts to fulfill the millions of existing recalls.

Takata has even reached out to rival companies, including Autoliv and TRW, to help make replacement inflators.

“You have got only three or four global suppliers of air bags, and they have only got so much capacity,” said Karl Brauer, senior analyst at Kelley Blue Book. “This shows the downside of having global supply chains where you have a standardized part which so many cars use.”

Takata came up with an air bag design that could be used in many different car models, said Scott Upham, chief executive of auto industry research firm Valient Market Research. That design uses ammonium nitrate, a chemical that inflates air bags upon impact.

But the chemical can degrade over time, especially when exposed to high humidity and fluctuating temperatures; in a crash, it can explode with too much force, rupturing the air bag and shooting shrapnel into drivers and passengers.

Consumers are buying new cars and not realizing they're going to be recalled.
— Sen. Bill Nelson (D-Fla.)
Upham believes Takata had a financial incentive to use ammonium nitrate – a compound that no other air bag makers use in their inflators. Ammonium nitrate is cheaper than comparable compounds, translating into Takata pricing its air bags at around $5 less than competitors, he said.

That’s big savings for carmakers when multiplied over tens of millions of vehicles.

Takata’s success – before the recall, the Japanese company controlled 22% of the global market for inflators – also means that any recalls are correspondingly huge, Upham said.

And it’s not just limited to brands offering low-priced cars – Mercedes-Benz and BMW have recalled vehicles as well.

“Carmakers have kind of shot themselves in the foot,” Upham said. “They wanted economies of scale and lower prices. That's what they ended up getting.”

Brauer of Kelley Blue Book compared the problem to “a bad virus.”

One bad part “infects tens of millions of cars,” he said.

Experts said that automakers are betting they can sell new vehicles with the faulty inflators, as long as they issue recalls before they become dangerous.

These new cars can be sold legally. The National Highway Traffic Safety Administration has said that inflators can function for at least six years before becoming potentially unsafe. Buyers probably won’t need to bring them in for years, as older models require more urgent replacement.

See more of our top stories on Facebook >>

Still, this sort of tricky calculus has longtime auto observers shaking their heads. The longevity of the inflators is dependent on humidity and temperature, they point out, but automakers obviously have no control over where cars go once they leave the lot.

“It’s truly bizarre,” said Brauer, who compared the faulty inflators to perishables like milk. “They have a date at which they go bad, but you don’t know when that is.”

Mitsubishi and Volkswagen disclosed the new models equipped with faulty Takata inflators, the report said. They include the 2016 and 2017 Mitsubishi i-MiEV, 2016 Volkswagen CC, 2016 Audi TT and 2017 Audi R8. Fiat Chrysler and Toyota did not provide the models of the new cars produced with the problematic inflators (although Toyota estimated it will produce about 175,000 vehicles that fall into this category).

Largest-ever U.S. auto recall gets bigger: 12 million more vehicles with Takata air bags ordered back
Largest-ever U.S. auto recall gets bigger: 12 million more vehicles with Takata air bags ordered back
NHTSA said in March that the multiple phases of recalls is slated to end by December 2019. But experts said that doesn’t take into account another huge potential problem: replacement inflators may have to be recalled.

The replacement inflators currently being produced still contain ammonium nitrate, but include desiccants that absorb moisture. That cures the humidity problem, but does not solve the risk of the chemical breaking down when faced with fluctuating temperatures.

Those kinds of wild swings on the thermometer can “wreak havoc” on the chemicals, turning them from solids into powder, Upham said.

“That’s what’s creating these huge pressure spikes,” he said, “which is basically flames shooting out of your air bag.”

sockpuppet

Thanks, but in truth, I am pretty well educated already. What you've posted today is a Statement of Claim, containing nothing but unproven allegations. If it goes to trial, perhaps some or all of those allegations will be proven, but until then, it's nothing more than an unfounded claim. Calling them "court documents" to try and give them an air of authority is technically accurate, but disingenuous nonetheless.

I've drafted many myself. I have some idea of what I'm talking about.

And I understand wanting to have a safe vehicle. That makes sense. But in my view, your criticisms of Acura are a bit extreme. They've done a recall. For many, they've offered rentals. What more do you want? Faster recall service? Sorry, but Acura doesn't make airbags, so their hands are somewhat tied. What else can they do for you? A footrub and a two-for-one coupon at Bonanza? Write a letter and see what you can get, I suppose. But again, from my perspective, the response is appropriate.

Perhaps my perspective is a bit lax, and I'd be more concerned in some place like Florida, where the climate is more likely to degrade an inflator. But here in drier, cooler climes, I'm just not that concerned (even though I really don't want metal shards in my face...that's my moneymaker).

crxb

Sixty Million Car Bombs: Inside Takata’s Air Bag Crisis
How the company’s failures led to lethal products and the biggest auto recall in history.

Sixty Million Car Bombs: Inside Takata?s Air Bag Crisis - Bloomberg


Sixty Million Car Bombs: Inside Takata’s Air Bag Crisis
How the company’s failures led to lethal products and the biggest auto recall in history.
June 2, 2016
Susan Berfield
susanberfield
Craig Trudell
crtrud
Margaret Cronin Fisk Jeff Plungis
jplungis
Bloomberg Businessweek Reprints
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Carlos Solis was driving a familiar route, the few miles from his home to his brother’s apartment outside Houston, on a Sunday in January last year. His cousin sat beside him, and a dog was in the back seat. Just as they turned into the complex, their car, a 2002 Honda Accord, was hit. It was a low-speed collision with modest damage. Both front air bags deployed. Solis’s cousin got out of the car uninjured. The dog was fine, too. But Solis didn’t move. He’d been hurt, though at first it wasn’t obvious how. His cousin called Solis’s brother, Scott, who ran to the car. Scott tried to stanch the flow of blood from a deep wound in Solis’s neck; so did the paramedics. Solis died at the crash scene.

An autopsy, now part of court records, showed that a round piece of metal the size of a hockey puck had shot out of the Accord’s air bag, sliced into Solis’s neck, and lodged in his cervical spine and shoulder. It severed his carotid artery and jugular vein and fractured his windpipe. Solis was 35 and the father of two teenagers. He was also the sixth person in the U.S. killed by an exploding air bag made by the Japanese company Takata.

A Takata air bag inflator that deployed in 2014. The driver was killed by metal shards.
A Takata air bag inflator that deployed in 2014. The driver was killed by metal shards.
Source: Didier Law Firm P.A.
Two weeks after Solis’s death, his wife received a recall notice for the air bag. The first Takata recall had come seven years earlier, in 2008, limited to air bags in about 4,000 Hondas. The effort has been expanded 20 times, most recently in May, and is the largest and most complex in U.S. history. It covers more than 60 million air bags in vehicles from BMW, Ford, Honda, Tesla, Toyota, and 12 others, or one of every five cars on the road in the U.S. The recall could affect more than 100 million vehicles around the world. Shrapnel from the devices has killed 13 people, including 10 in the U.S., and injured more than 100.

A Senate investigation and personal injury litigation have turned up company documents suggesting that Takata executives discounted concerns from their own employees and hid the potential danger from Honda, their biggest customer, as well as from U.S. regulators. A Takata spokesman says via e-mail that the “data integrity problems reflected in some of the documents cited by the Senate Committee and produced in litigation are entirely inexcusable and will not be tolerated or repeated,” but are not related to the root cause of the air bag ruptures. The company declined to comment further.

It will take at least three years for Takata and other manufacturers to make enough air bags to replace the company’s defective ones. Because of their chemistry, Takata’s devices become less stable over time. That leaves millions of drivers with cars that could contain an air bag that’s like a ticking time bomb.

Exploding Air Bags and the Biggest Auto Recall Ever






Featured in Bloomberg Businessweek, June 6 - 12, 2016. Subscribe now.
Featured in Bloomberg Businessweek, June 6 - 12, 2016. Subscribe now.
Takata, founded by the Takada family in the 1930s as a textile maker, produced parachutes for the Imperial Japanese Army during World War II. In 1960, Takata began manufacturing seat belts for Japan’s carmakers, which were leading the country’s industrial expansion. It was the only company whose seat belts passed the U.S. National Highway Traffic Safety Administration (NHTSA) crash test standards in 1973.

A few years later, Honda asked Takata to look into manufacturing air bags. The automaker had a small stake in its supplier, and they worked closely together. When Honda opened a plant in England, Takata opened one in Ireland. When Honda went to China, so did Takata. “They were in lockstep to conquer the world,” says Scott Upham, the head of Takata’s marketing division in Auburn Hills, Mich., from 1994 to 1996 and now the chief executive officer of Valient Market Research. Despite Honda’s enthusiasm about air bags, Juichiro Takada, who had taken over from his father as CEO in 1974, hesitated. Air bags deploy in controlled explosions. Their designs are drawn from rockets and munitions. A former Honda engineer, Saburo Kobayashi, described Takada’s reservations in a 2012 memoir. “If anything happens to the air bags, Takata will go bankrupt,” Takada said, according to the book. “We can’t cross a bridge as dangerous as this.” Eventually, he relented.

Air bags aren’t filled with air. They’re filled with gas created by a burning propellant. Propellants are used in jet aircraft to produce thrust; in the interiors of gun chambers; and in mining and demolition. In air bags, the propellant is compressed into aspirin-size tablets and placed in a metal tube called an inflator. After a crash, the tablets are ignited and convert from solid to gas, which erupts out of the inflator and into the bag in milliseconds. Air bags have been mandatory in every U.S. car since 1989, and regulators say they save about 2,500 lives every year. Unlike drugs, there’s no approval process for air bags.

“There are about 10,000 components in a car,” Upham says, “and air bags are probably the most highly engineered among them, even more than the electronics.” They have to be small and light enough to fit into the steering wheel and other tight spaces, and they have to deploy with just the right force. Propellant experts keep patent offices busy. They’re always trying to come up with formulas that are more efficient, cheaper, and proprietary. Each of the world’s five main air bag manufacturers has developed its own chemical compound.

It’s best to make explosives in a place with low humidity. Takata started making air bag inflators in the U.S. in 1991, at a facility in Moses Lake, Wash. It’s near an old U.S. Air Force base, east of the Cascade Range, where the high-plains air is dry. Takata set up a joint venture with a company called Rocket Research, and when it looked like the business would succeed, it bought the other 50 percent, says Mark Lillie, who was hired as a propellant engineer in 1994 and has spoken out about his experiences at the company. “They spent hundreds of millions of dollars on the facility,” he says. “Takata was working hard to catch up and grab market share by being technologically sophisticated. We were moving so fast. It was terrifying, but exciting.”

Takata’s original propellant was based on a common chemical, sodium azide, derived from a formula the military had developed for launching torpedoes and missiles. Sodium azide was difficult to handle in the factory, though—prone to exploding when exposed to air, light, or jostling. When inhaled, it was toxic, and after the air bags deployed, they left a residue inside cars. Most companies that used it were looking for an alternative.

Takata’s second-generation propellant, introduced in 1996, was based on a chemical called tetrazole, which was safer than sodium azide and just as effective. Researchers code-named the formula 3110, and the company marketed it as Envirosure. Takata was the first to use tetrazole, and the chemical helped the company bring in Ford and General Motors, expanding its share of the North American market to 10 percent. But the supply of high-quality tetrazole was limited and costly. “Takata made promises to customers for volumes that could not be supported by the existing pipeline for the raw materials,” Lillie says. “The culture was: We will make a commitment to the customer, and then we will work like the dickens to make it happen somehow.”

When Takada visited Moses Lake in 1997, he took the managers to dinner to thank them for keeping up with production quotas in tough circumstances. Lillie says Takada told a story: Japanese scientists once cultivated wasabi in labs and test farms, and while it looked beautiful, it had no flavor. Natural wasabi grows on the side of rugged mountains. The scientists realized that the stress on the wasabi produced its distinct flavor. Lillie says, “Then Juichiro turned to the group, paused, and said: ‘You are the wasabi! You’ve been through these extreme things, and it’s going to make you stronger!’ ”





Takata also had a skunk works near Detroit, Automotive Systems Labs, and gave it an assignment: develop a propellant formula that would be easier and cheaper to produce than Envirosure and would allow the air bags themselves to be smaller and lighter. “ASL looked at every chemical compound known to man,” Upham says. Among them was ammonium nitrate, the most widely used commercial chemical explosive in the world, almost as powerful as dynamite. In 1995, Timothy McVeigh used 2,000 pounds of the chemical to blow up the Alfred P. Murrah Federal Building in Oklahoma.


Ammonium nitrate was about one-tenth the price of tetrazole, according to Upham, who also reviewed industry patents. But ammonium nitrate had a critical flaw that he says led other air bag makers to give up on it: Ammonium nitrate has five phases of varying density that make it hard to keep stable over time. A propellant made with ammonium nitrate would swell and shrink with temperature changes, and eventually the tablet would break down into powder. Water and humidity would speed the process. Powder burns more quickly than a tablet, so an air bag whose propellant had crumbled would be likely to deploy too aggressively. The controlled explosion would be just an explosion. “Everybody went down a certain road, and only Takata went down another road,” says Jochen Siebert, who’s followed the air bag industry since the 1990s and is now managing director of JSC Automotive Consulting. “If you read the conference papers from back then, you can actually see that people said, ‘No, you shouldn’t. It’s dangerous.’ ”


When Lillie and other Moses Lake engineers met with their ASL colleagues in December 1998 to review a new design using ammonium nitrate, Lillie says they were told the phase stability problem had been solved. He rejected the design nonetheless. ASL wasn’t able to provide documented evidence of the safety of its product, he said in a January 2016 deposition, taken as part of a personal injury suit against Takata and Honda. “Never any evidence, never any test results, never any test reports, nothing to substantiate they had overcome the phase stability problem,” Lillie testified.

“At the meeting, I literally said that if we go forward with this, somebody will be killed,” he adds in an interview, echoing his testimony. After the design review, Lillie says he met separately with the engineer who served as the liaison with Takata headquarters in Tokyo. “What I gathered from the conversation was, ‘Yes, I’ll pass on your concerns, but don’t expect it to do any good, because the decision has already been made.’ ” The head of ASL was Paresh Khandhadia, who had a master’s in chemical engineering and “was a very smooth operator,” Lillie says. “Tokyo put a tremendous amount of stock in his credentials.” Neither Khandhadia, who left Takata in 2015, nor his lawyer responded to requests for comment. During a deposition last year, Khandhadia was nearly silent, citing his Fifth Amendment right not to testify against himself.

Lillie says he left Takata in 1999, partly because the company ignored his warnings about ammonium nitrate. He says Takata’s executives and workforce were unprepared to take on such a difficult design and manufacturing process. “Takata engineers claimed they had this magic,” he says. “No one else could figure it out, and they had.”

As the Moses Lake facility prepared to manufacture inflators with the ammonium nitrate propellant, some of Lillie’s former employees became anxious. “It was always push, push, push the envelope,” says Michael Britton, a propellant engineer who left in 2000. Lillie testified that a Takata engineer wasn’t allowed to investigate an inflator that ruptured during testing, and that when he protested, he was reassigned. A quality manager told Lillie that he was pressured by an executive at Moses Lake to manipulate test data. “Torture the data until it confesses” is the way the engineers described it, Lillie said in his deposition. A Takata spokesman says ASL conducted testing that “went beyond industry standards at the time” and found no significant changes in the propellant’s performance or physical properties, and that a German research institute has since tested the propellant and found no evidence of a loss of phase stability. He also says there’s no evidence that Lillie raised any concerns about using ammonium nitrate or that Takata executives weren’t interested in hearing them.

In November 2000, Tom Sheridan, then a Takata product engineer, wrote a memo to his bosses about test data for Honda. “The objective of this cover letter is to point out that the Honda test report has incorrect data, data that cannot be validated, data that was incorrectly labeled, or data that does not exist,” it said. The memo was turned over to plaintiffs’ lawyers suing the two companies. Sheridan, who left Takata in 2002, testified that after he submitted the report, none of his bosses spoke to him about the issues he raised. A company spokesperson says: “Takata deeply regrets that this validation test data was incorrectly reported,” but that the test results aren’t related to the cause of the ruptures.



Pieces of metal shrapnel from a defective Takata air bag are displayed at a 2015 news conference in Washington, D.C.
Pieces of metal shrapnel from a defective Takata air bag are displayed at a 2015 news conference in Washington, D.C.
Photographer: Chip Somodevilla/Getty Images
By 2001, Takata was confident it had engineered a safe way to make air bags with ammonium nitrate and was selling them to automakers including Honda and Nissan. It began moving production to a new plant in Monclova, Mexico, where workers were paid less and had less experience with explosives. Takata hired local managers and gave them a great deal of autonomy, Upham says. From late 2001 to late 2002, workers there left some of the compressed propellant exposed to uncontrolled moisture, which can over time lead to “over-aggressive combustion,” according to regulatory filings. Takata later told NHTSA it had improved manufacturing conditions.

When an air bag exploded in a Honda Accord in 2004, shooting out metal fragments and injuring the driver, Takata called it an anomaly. The accident, in Alabama, turned out to be the first of more than 100. Honda says it settled with the driver; the terms are confidential.

Around the same time, a former Takata senior executive based in Europe says he challenged Khandhadia about the use of ammonium nitrate, but Khandhadia had Tokyo’s support. The executive, who remained at the company for a decade, didn’t want to be named because he still works in the industry. He wasn’t the only one in Europe who considered ammonium nitrate too risky. Renault refused to buy air bags with it. The former executive went around Khandhadia rather than fight him. He says he hired a propellant specialist to help develop a more stable formula using guanidine nitrate, and since about 2008, Takata in Europe has sold air bags using that. He says Takata’s China team also adopted the formula.

Bob Schubert, a Takata propellant engineer in the U.S., also worried about ammonium nitrate, according to the former executive. In January 2005, Schubert wrote to his boss that the company was “prettying up” air bag data sent to Honda. At one point, the devices were said to have passed tests that never occurred. “It has come to my attention that the practice has gone beyond all reasonable bounds and likely constitutes fraud,” he wrote in an e-mail produced in a lawsuit. Schubert, now a member of Takata’s new-product safety group, wasn’t made available for an interview. Takata says it apologizes for these lapses, but they’re unrelated to the current air bag inflator recalls.



A 2006 explosion at Takata’s factory in Mexico.
A 2006 explosion at Takata’s factory in Mexico.
Photographer: Gustavo Adolfo Rodriguez/Reuters
Three explosions shook the Monclova factory in March 2006. Fireballs spewed out, windows on nearby houses were shattered, and local papers reported that authorities had to evacuate thousands of residents. Takata says only that employees weren’t handling “propellant scrap” properly and that afterward the factory improved its safety procedures. The plant resumed operations within a month, and Takata’s customers didn’t suffer any production disruptions. Automotive News called Takata’s quick recovery “remarkable.”

Takata engineers were filing patents for processes to improve the stability of ammonium nitrate. One described coating the chemical particles with paraffin to create a shield against heat and humidity, says Lillie, who’s reviewed the documents. Another said that phase-stabilized ammonium nitrate propellants “exhibit significant aggressive behavior with regard to ballistic properties” and that air bag inflators are subject to environmental conditions that can cause problems, including “over-pressurization of the inflator leading to rupture.” Takata previously has said that it’s “always understood the effects that moisture may have on the combustion characteristics of ammonium nitrate, but phase-stabilized ammonium nitrate propellant is safe and effective for use in air bag inflators when properly engineered and manufactured.”

In 2006 a Takata engineering manager sent an e-mail to a colleague that suggests data about potential problems with product tests were being hidden or ignored: “It is yet another mess-o-shit we will be handed with no real fix possible. The plant should have been screaming bloody murder long ago.” A Takata spokesman reiterates that such data integrity problems are inexcusable and won’t be tolerated, but that they have nothing to do with the root cause of the air bag ruptures.

Takata went public in November of that year, listing shares on the Tokyo Stock Exchange. The Takada family and trust retained a stake of more than 80 percent (it’s now about 60 percent). A succession plan was put in place the following year. Juichiro Takada became chairman, while remaining CEO until the time came to hand over leadership to his son Shigehisa, then 41, who was promoted to president. Akiko Takada, Shigehisa’s mother, resigned as a director and became an adviser. The differences between father and son were striking: Juichiro, known as Jim to his American employees, would get down on his knees to inspect factory equipment. Lillie describes Shigehisa as awkward, quiet, and entitled. When he visited Moses Lake in the late 1990s, he wouldn’t put on safety glasses, and Lillie didn’t let him onto the factory floor.





Honda announced the first recall of 3,940 cars in November 2008, citing excessive moisture that had affected the ammonium nitrate propellant at Takata’s plant in Mexico. Takata assured Honda and federal regulators that the manufacturing problems were limited and had been addressed. In fact, Takata changed the composition of the propellant mix itself, adding a desiccant, a substance that absorbs water. The engineers believed this would prevent the ammonium nitrate from degrading and exploding.

Eight months later, Shigehisa Takada had to defend his company in front of Honda executives. At a meeting in Honda’s offices outside Los Angeles, which was recounted in an internal e-mail produced in a lawsuit, he was asked if he grasped the gravity of their predicament. The Honda executive said he was “constantly worrying” because Takata didn’t appear to have control of the situation. “Tighten the system inside Takata again,” the Honda executive said, according to the e-mail. A Honda engineer added that Takata was moving too slowly: “Why does it explode? I want to know the truth.”

U.S. regulators began an investigation into Takata in late 2009 and closed it six months later, noting the company had identified the problem—a manufacturing mistake at its other plant at Moses Lake—and Honda had issued a recall for those air bags. “My take is that if NHTSA had done the right thing and really probed Takata, they could have caught it a lot sooner and we wouldn’t have the crisis we have today,” says Clarence Ditlow, the executive director of the nonprofit Center for Auto Safety. “Takata made one of the most colossal blunders in the history of the industry.”







A recalled Takata air bag inflator.
A recalled Takata air bag inflator.
Photographer: Joe Skipper/Reuters
In a widely reported incident on April 2, 2010, Kristy Williams stopped at a red light in Morrow, Ga., and the air bag in her 2001 Honda Civic deployed by mistake. The inflator exploded, and shredded metal hit Williams in the neck, severing her carotid artery. She stuck two fingers in the gaping wound to stop the bleeding as she waited for an ambulance. The blood loss led to several strokes, a seizure, and a speech disorder, according to a lawsuit she filed against Takata and Honda. The companies settled her case confidentially.

Honda expanded recalls of cars with Takata air bags in 2009, 2010, and 2011, eventually to include 2.5 million vehicles. In 2013, Takata filed a defect report with U.S. regulators stating that certain passenger-side air bags could rupture as a result of manufacturing errors that were exacerbated when the air bags were exposed to heat and humidity. A year later, NHTSA asked 10 car companies to recall 7.8 million vehicles with Takata air bags in seven Southern states as well as Puerto Rico and the U.S. Virgin Islands. After the announcement, so many people checked the NHTSA website that it crashed. Toyota advised passengers not to sit in the front seats of several models until the air bags were replaced.

The situation in Monclova threatened to create other problems for Takata. Guillermo Apud, a supervisor at the plant, had to scold employees in a May 2011 e-mail about their sloppy, and potentially dangerous, work habits. He had noticed that they were “reworking,” trying to fix defective parts on the inflator assembly line rather than removing them to be examined later. “Rework on the line is PROHIBITED!!! We can’t have leaders/materials/people/operators REWORKING material left and right without ANY control, this is why we have defect upon defect. We need to change NOW!” In 2012 workers there put the wrong part into inflators, and more than 350,000 vehicles from three carmakers had to be recalled. Takata says Apud was trying to convey the importance of quality and safety and make sure the inflators were properly manufactured.

In March 2012, Angelina Sujata was driving her 2001 Honda Civic at about 25 miles an hour near Columbia, S.C., when the vehicle ahead of her slammed on the brakes. The 18-year-old hit the car, and the next thing she remembers was feeling a sharp pain in her chest. “My chest was sliced open, down to the bone,” she says in an interview. Sujata was rushed to the hospital, where a doctor pulled out several metal fragments. A year later she received a recall notice about the defective air bag. She sued Honda and Takata and is waiting for a trial date.

It took until 2015 for Takata to acknowledge the problem was more widespread, and NHTSA announced a nationwide recall of some 22 million inflators. “Takata provided inaccurate, incomplete, and misleading information to regulators for nearly a decade,” says NHTSA spokesman Bryan Thomas. “Had they told the truth, Takata could have prevented this from becoming a global crisis.” Takata declined to comment.





Shigehisa Takada took over the company after Juichiro died in 2011. He was 45 and had worked at Takata his entire adult life, mostly in his father’s shadow. As recall followed recall, he apologized in written statements and newspaper ads. When the company was called to testify before Congress, he sent deputies on all four occasions. Takada didn’t make his first public apology until June 25, 2015, after the annual shareholder meeting. He bowed and whispered: “The company that should be offering the safety to the users ended up hurting them. It grieves me most deeply.” He also insisted that Takata’s air bags were safe. He didn’t mention that Takata had tried to fix the problem by changing the propellant formula in 2008. He made it seem as if the source of the trouble was a mystery.

“They continue to deny that ammonium nitrate is to blame,” Upham says. “They say they’re still looking for the root cause. That’s like O.J. saying he’s going to find Nicole’s killer.”

Shigehisa Takada’s public apology at the shareholder meeting, June 2015.
Shigehisa Takada’s public apology at the shareholder meeting, June 2015.
Photographer: Yoshikazu Tsuno/AFP/Getty Images
Five months later, on Nov. 3, 2015, U.S. regulators announced that Takata would pay a fine of $70 million—and as much as $130 million more if it fails to meet its commitments. It also has to cooperate with an independent monitor. NHTSA says the civil penalty is the largest the agency has ever imposed and the extent of the monitor’s oversight is unprecedented. CEO Takada said the company agreed to the penalty “considering the strong demand from NHTSA and also the users’ anxiety, even though we are confident of the safety of our product.” The same day, Honda said publicly that the air bag maker seemed to have manipulated test data. When Takada was asked about that at a news conference, he said, “We did not do it. I don’t think.”

In early May, federal safety regulators said three independent investigations had come to the same conclusion about the lethal air bags: Long-term exposure to changes in temperature and moisture can make ammonium nitrate propellant dangerously powerful. “The science now clearly shows that these inflators can become unsafe over time, and faster when exposed to high humidity and high temperature fluctuations,” said Mark Rosekind, the head of NHTSA. The agency also expanded the recall to more than 60 million air bags—every one that doesn’t have the drying agent. The bags must be replaced by 2019. Takata has until the end of 2019 to prove that even the air bags with the drying agent are safe. On June 1, a Senate report noted that four carmakers are still selling new models with faulty air bags that will need replacing.

Japan also recently expanded its own recall to almost 20 million vehicles. A definitive count isn’t possible; Takata doesn’t disclose the total number of air bags that will have to be replaced. Bloomberg News contacted affected carmakers and used regulators’ announcements to calculate a worldwide figure of roughly 100 million.

Schubert, the engineer who’s joined Takata’s product safety group, said in a deposition that the ammonium nitrate propellant doesn’t cause problems “until the degradation process has proceeded a very long way, and then the results fairly quickly go to rupture.” He suggested the process could take 10 years, while lawyers for some of the victims say it can happen in as few as seven. This would explain why most of the deaths have occurred since 2011 in cars with air bags manufactured roughly a decade before.

Only 8.4 million Takata air bags had been replaced in the U.S. as of May. Carmakers and dealers face two problems. Although Takata used the same chemical compound as the base for its propellant, the air bags came in various shapes and sizes, complicating their replacement. Takata says it has “dramatically increased” production of new parts, but its competitors have been only too happy to step in. NHTSA says those companies are making 70 percent of the replacement inflators. Still, there won’t be enough.

The second challenge is that it’s been difficult in many cases to find the owners of older vehicles, which are more likely to have changed hands at least once. That was the case with Carlos Solis, whose Honda had two previous owners before he bought it from a used-car dealer. Such dealers aren’t required to keep track of recalls for the cars on their lots. Since last year, Honda has flashed alerts on stadium scoreboards and placed ads on Facebook and Twitter. It’s even hired private detectives to track down owners of older vehicles.

Takata is under a criminal investigation by the U.S. Department of Justice and has been sued by the state of Hawaii for allegedly covering up the defects in its air bags. (Takata says it’s cooperating fully with Justice. It declines to comment on the lawsuit.) The company faces potential fines, as well as the cost of litigation and payouts to victims. At some point it also will have to settle up with carmakers that for now are paying for the replacement air bags. The total could be more than $11 billion, according to an analyst at Jefferies. Takata doesn’t have billions. It has only $520 million on hand and is worth about $340 million, less than one-tenth what it was worth at its peak in 2007. The company had a 17 percent share of the global air bag market then; Upham estimates that will have shrunk to 5 percent by 2020.

On May 25, Takata said it had hired Lazard to help secure funding and negotiate with its customers. That’s a polite way of saying someone else will decide its future. No matter who that someone is, the Takada family’s stake will likely be reduced and the CEO replaced. “Takata will have to own up to what they’ve done,” says Carlos Solis’s brother, Scott. “They brought this on themselves.”

—With Yuki Hagiwara