Airbag Recalls

[DallasCowboysFan]

Last week, Ford announced it was recalling 2.6 MN cars as the result of faulty airbags from Takata.

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Ford is recalling about 2.6 million cars, SUVs, and trucks in the U.S. and its territories to replace driver-side Takata airbags.

The problem: The driver-side front airbag inflators contain a calcium sulfate desiccant that may degrade after long-term exposure to high humidity and temperature cycling. This could cause an inflator to rupture during airbag deployment, leading to injury and possible death.

The fix: Dealers will replace the driver-side front airbag inflator or airbag module.


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Who pays for the recall?
I would assume that it is Ford, but why should they have to bear the expense of recalling 2.6MN cars because the supplier was careless?

It seems that there should be an agreement that if a part fails, then the supplier must share in the expense of the recall and repairs. It should also leave the door with a free oil change and a car wash, but that never happens.

What kind of arrangement exists between suppliers and manufacturers with respect to the warranty of parts?

Is Takata the only manufacturer of airbags? They were in the headlines ten years ago when so many airbags were exploding without warning, and sending metal parts into the drivers. It seems that they are the only ones in the news with regards to airbags.

Is the reason that Ford and others contract to buy airbags from them is to put some distance between themselves and a huge injury award if a critical part fails? They can blame it on the supplier and not take responsibility?

 

[ph1l]

It seems that there should be an agreement that if a part fails, then the supplier must share in the expense of the recall and repairs.

Takata probably paid something before going bankrupt.
https://money.cnn.com/2017/06/25/news/companies/takata-bankruptcy/index.html

Takata, brought down by airbag crisis, files for bankruptcy
by Jethro Mullen @CNNMoneyJune 26, 2017: 11:23 AM ET

Airbag manufacturer Takata files for bankruptcy

The company at the heart of one of the worst auto safety scandals in history has filed for bankruptcy.

Japan's Takata was brought down by the huge cost of its exploding airbag crisis. The company's faulty airbag inflators, which can blast shrapnel into drivers and passengers, have resulted in the recall of tens of millions of vehicles and been linked to 11 deaths in the U.S. and several others elsewhere.


With spiraling debts estimated at more than $9 billion, Takata (TKTDY) said Monday it's seeking bankruptcy protection in Japan and the U.S. It's also selling off the lion's share of its business to a U.S.-based rival.

Key Safety Systems, a Chinese-owned company based in Michigan, is paying $1.6 billion for nearly all of Takata's operations. But it's staying away from the parts that deal with the airbag inflators, which will eventually be wound down.

"We caused troubles for our supporters, those who cooperated with us and the creditors," Chairman Shigehisa Takada said at a news conference Monday where he bowed before the cameras. "On behalf of Takata, I apologize deeply from the bottom of my heart."


Related: Have an exploding airbag? You might get $500

The airbag scandal has led to a slow and painful demise for Takata, which started out as a textile manufacturer more than 80 years ago and later came to specialize in seat belts and other auto safety equipment.

"The sad saga of Takata ... has resulted in the implosion of one of the automotive industry's oldest and most successful suppliers due to technical hubris, mismanagement and a systemic corporate culture of manipulation," said Scott Upham, the CEO of Valient Market Research.

Earlier this year, Takata admitted to manipulating and withholding key information about the faulty inflators for years, even after they started exploding in people's cars. It pleaded guilty in the U.S. to a criminal charge of wire fraud for which it will have to pay $1 billion, including a $125 million fund to compensate victims and their families.

Related: Three Takata executives indicted over exploding airbags

The money from the sale of the business to Key Safety Systems will be used to cover those and other costs resulting from the airbag recall. But Takata shareholders are unlikely to get their money back, Upham said.

The company's stock plunged more than 65% last week following reports that its bankruptcy filing was imminent. Its shares were suspended Monday because they're going to be delisted, the Tokyo Stock Exchange said.

The major automakers who used Takata airbags in their cars -- including Honda (HMC), Toyota (TM) and GM (GM) -- could also end up out of pocket. Upham said they're likely to have to pick up the tab for most of the estimated $5 billion that's needed to pay for replacing the tens of millions of Takata airbag inflators still in people's vehicles around the world.

Only 35% of affected cars have so far had their inflators replaced, he added. The process of making all U.S. vehicles safe again could last until 2023.

Related: Takata airbag recall could take until 2023 to complete

But Takata's bankruptcy isn't expected to disrupt the massive recall triggered by its faulty products.

The Japanese firm is now supplying only 25% of the replacement inflators, according to Upham, with rival companies providing the rest.

Despite its disastrous airbag business, Takata has other operations that are still in good shape. That's what attracted Key Safety Systems, which is owned by China's Ningbo Joyson Electronic Corp.

"Although Takata has been impacted by the global airbag recall, the underlying strength of its skilled employee base, geographic reach, and exceptional steering wheels, seat belts and other safety products has not diminished," said Key Safety Systems CEO Jason Luo

The auto manufacturers aren't completely innocent in this. Ford might be recalling the driver-side airbag now even though they know the passenger-side airbag has similar problems. And the same vehicles might be recalled for that later.

 

[DallasCowboysFan]

When a car is recalled for safety issues, does the supplier share in the cost of the recall?

 

[HobbyTrading]

Last week, Ford announced it was recalling 2.6 MN cars as the result of faulty airbags from Takata.

Which car models, and from what manufacturing year, are involved in this recall?
I thought that by now all car makers had recalled all their old cars to replace the older Takata airbags.

 

[HobbyTrading]

When a car is recalled for safety issues, does the supplier share in the cost of the recall?

Yes, but that is in most cases up for discussion/negotiation between the car maker and the supplier. The terms and conditions are most likely not be shared publicly.
By the way: Takata went bankrupt due to their faulty airbags and all recall costs. The remainder of Takata was then bought by another company.

 

[DallasCowboysFan]

Which car models, and from what manufacturing year, are involved in this recall?
I thought that by now all car makers had recalled all their old cars to replace the older Takata airbags.

This might help.......


https://www.cnn.com/2021/01/22/business/ford-takata-airbag-recall/index.html

 

[DallasCowboysFan]

Yes, but that is in most cases up for discussion/negotiation between the car maker and the supplier. The terms and conditions are most likely not be shared publicly.
By the way: Takata went bankrupt due to their faulty airbags and all recall costs. The remainder of Takata was then bought by another company.

Yeah, I am sure it is confidential.
I just wonder what kind of arrangements exist.

I forgot about Takata going bankrupt. It's amazing that they are still in the news, so many years after going bust.
I wonder how many of their airbags are in still riding around in existing cars?

 

[HobbyTrading]

This might help.......


https://www.cnn.com/2021/01/22/business/ford-takata-airbag-recall/index.html

The article explains that it is about cars manufactured in the years 2006 ~ 2012. Thus these are old cars which were not yet included in previous recalls.

 

[HobbyTrading]

I forgot about Takata going bankrupt. It's amazing that they are still in the news, so many years after going bust.
I wonder how many of their airbags are in still riding around in existing cars?

A lot of those dangerous airbags are still on the road: many owners did not respond to the recalls and did not get their airbags replaced. Many cars easily reach an age of 10 ~ 20 years before getting scrapped, so these cars will remain on the road for quite a number of years as the usage of these faulty airbags continued to 2012 or beyond.

Edit: by the way, the Takata issue was such a huge issue that the car makers were not able to recall all cars at once. Takata's competitors were not large enough to product sufficient airbags to replace the faulty airbags. That is why the recalls were spread out over multiple years. And I've heard that car makers provided financial support to airbag makers to build additional factories to produce all these replacement airbags.
Takata had a majority of market share in this business as their product was so much better and cheaper than their competitors. Until the design flaw (the chemical used) and danger of these airbags became clear.....

 

[newwurldmn]

A lot of those dangerous airbags are still on the road: many owners did not respond to the recalls and did not get their airbags replaced. Many cars easily reach an age of 10 ~ 20 years before getting scrapped, so these cars will remain on the road for quite a number of years as the usage of these faulty airbags continued to 2012 or beyond.

Edit: by the way, the Takata issue was such a huge issue that the car makers were not able to recall all cars at once. Takata's competitors were not large enough to product sufficient airbags to replace the faulty airbags. That is why the recalls were spread out over multiple years. And I've heard that car makers provided financial support to airbag makers to build additional factories to produce all these replacement airbags.
Takata had a majority of market share in this business as their product was so much better and cheaper than their competitors. Until the design flaw (the chemical used) and danger of these airbags became clear.....

One of my cars only got the recall notice late last year (4 years after the recalls started).