This has been an eventful day for Japanese automotive airbag manufacturer Takata, and by consequence, automotive manufacturers.

 

To begin with, a new death has been linked to Honda vehicles with defective Takata airbags. The Japanese automaker also announced it is expanding its Takata-related recalls since a driver in Malaysia died in an air bag-linked accident earlier this year. Honda spokeswoman Misato Fukushima said the latest death, in July, is believed to have been caused by a faulty Takata bag. That brings the number of deaths possibly caused by faulty Takata bags to five, and hundreds of injuries.

 

The airbags made by Takata have faulty inflators that can explode, hurling shrapnel toward drivers and passengers. Worldwide estimates of cars affected by Takata-related recalls range from 12 million to 17 million, and involve 10 automakers including Toyota, General Motors and Honda. About eight million of the recalls are in the U.S. Honda, which has reported the largest number of recalls related to defective air bags, said it is recalling 70,979 more vehicles outside the U.S.

 

Last week, quoting two former Takata employees, the New York Times reported that Takata—alarmed by a report a decade ago that one of its airbags had ruptured and shot metal debris at a driver in Alabama—secretly conducted tests on 50 airbags it retrieved from scrapyards. The steel inflators in two of the airbags cracked during the tests, a condition that can lead to rupture, the former employees said. The result was so startling that engineers began designing possible fixes in preparation for a recall, the former employees said, according to the New York Times.

 

However, instead of alerting federal safety regulators to the possible danger, Takata executives discounted the results and ordered the lab technicians to delete the testing data from their computers and dispose of the airbag inflators, the former employees say in the New York Times article.

 

Takata today disputed the NYT article. Instead, company officials say the tests were carried out on an airbag part that was unrelated to the inflator mechanism at the center of the growing crisis, explains an Agence-France Presse article running on IndustryWeek.

 

“Our company did not carry out such test [on inflators] in 2004, and we absolutely did not cover-up test results, as reported in the story,” a Takata official said. “This was not a ‘secret’ test...The story is based on an inaccurate understanding of the facts, and it defames our firm and employees,” the article reports.

 

The fallout has been noticeable. Takata’s shares have lost about half their value since an investigation was opened this summer. The ramifications also extend to automakers.

 

In light of the allegations that Takata covered up the fatal defect for years—investigators are now probing Honda over similar allegations, reports another Agence-France Presse article I saw on Japan Today.

 

“Instead of safely deploying airbags to protect vehicle occupants, the defective Takata inflators…explode, sending metal and plastic shrapnel into the vehicle cabin,” says U.S. law firm Hagens Berman, which is involved in a class-action lawsuit against Takata and Honda, the article reports. “Rather than take the issue head-on and immediately do everything in their power to prevent further injury and loss of life, Takata and Honda have engaged in a 10-year pattern of deception and obfuscation.”

 

Finally, in one more news story today, the Associated Press reports that a U.S. Senate committee will hold a hearing next week on recalls of potentially deadly air bags made by Takata. The Commerce Committee hearing will examine Takata’s air bag recalls as well as the government’s recall process.

 

What are your thoughts on the recalls and ramifications for automotive manufacturers?