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April 11, 2013 01:00 AM

Toyota, other Japanese automakers recall 3.4 million vehicles with Takata airbags

From wire reports
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    Bloomberg
    Toyota said that five incidents of malfunctions have been reported. A screen displays a video on airbag safety on Toyota vehicles at the company's showroom in Tokyo.

    TOKYO (Reuters) -- Japanese automakers including Toyota, Nissan and Honda are recalling about 3.4 million vehicles worldwide due to defective airbags supplied by Takata Corp.

    Toyota is recalling about 1.73 million vehicles produced between November 2000 and March 2004, including 580,000 vehicles in North America and 490,000 vehicles in Europe. Honda is recalling about 1.14 million vehicles, while Nissan said it may call back 480,000 vehicles. Mazda said it recalled 45,463 units.

    It is the largest recall for airbags made by Takata, the world's second-largest supplier of airbags and seatbelts, Reuters reported. Also, it is the largest recall for Takata since 1995 when the company was involved in a recall of 8.8 million vehicles because of defective seatbelts. Shares of Tokyo-based Takata tumbled almost 10 percent in Tokyo trading today.

    The recall covers some of the top-selling Japanese cars, including Toyota's Camry and Corolla, and rivals like the Nissan Maxima and Honda Civic. The Camry is not being recalled in the United States. All of the vehicles in question were manufactured in or after 2000.

    FACTBOX: How car owners might be affected by airbag recall

    Four Japanese automakers are recalling 3.4 million vehicles sold around the world because their airbags, made by Japan's Takata Corp., are at risk of catching fire or injuring passengers. This includes 1.3 million vehicles in the United States. Here are details on what cars have been recalled, the risks identified and what owners need to do:

    What cars have been recalled?

    1. Toyota Motor Corp. is recalling about 1.73 million vehicles produced between November 2000 and March 2004, including 580,000 vehicles sold in North America and 490,000 vehicles sold in Europe. Among the affected models are the Lexus SC, the Toyota Corolla, Sequoia and Tundra and the Pontiac Vibe. The Camry sedan is also affected, but not in the U.S. market.

    2. Honda Motor Co. said it was recalling around 1.14 million vehicles worldwide, including 561,400 vehicles in the United States and another 107,800 in Canada. Affected models include the Civic, CR-V and Odyssey.

    3. Nissan Motor Co. said it was recalling about 480,000 vehicles globally; more than 265,000 of those were in the Unted States.

    4. Mazda Motor Corp. said it was recalling 45,500 vehicles worldwide. It has not yet disclosed the same level of detail as Toyota and Honda about recalled models and years. Mazda is recalling 149 cars in the United States including 147 Mazda 6 sedans and two RX-8 sportscars.

    What is the danger?

    In an accident, the airbag for the front passenger seat may not inflate correctly because of a manufacturing defect in the propellant used in the airbag inflator, the companies said. As a result, there is a risk of fires starting or of passengers being injured by metal fragments shooting up toward the windshield or down into the passenger foot well. Not all cars recalled will need the airbag fix -- only those found to have the defective parts.

    How long will it take and what will it cost?

    Toyota, for example, said it will exchange the faulty airbag inflators for new ones, a fix that is expected to take anywhere from 1 hour to 2-1/2 hours for most models. The automakers have said the repairs will be free of charge.

    When will notices be sent?

    Honda has said it would start sending notifications to affected owners as of May 11. Other automakers have not yet provided those details.

    Toyota spokeswoman Shino Yamada said that five incidents of malfunctions have been reported, though there were no accidents or injuries.

    In the United States, vehicles involved include certain Toyota Corolla, Corolla Matrix, Sequoia, and Tundra, and Lexus SC 430 models manufactured from 2001–2003, according to a statement from Toyota Motor Sales USA Inc. in California.

    "More precise vehicle information is being developed, but about 510,000 vehicles may have to be inspected to locate the suspect inflators," the company said.

    For Toyota, it's the second time this year that the company has announced a recall involving more than 1 million vehicles. Toyota said in January it will recall nearly 1.3 million cars globally for two separate defects, including 752,000 Corolla and Corolla Matrix vehicles in the United States to fix airbags that could be deployed inadvertently. U.S. supplier TRW Automotive manufactured the airbag control unit in the vehicles, although a problematic chip in the airbags was supplied by another company, Reuters reported.

    Last year, Toyota announced a recall involving 7.43 million units in October, followed by one involving 2.77 million vehicles the next month.

    Dating back to 2011

    Takata said it learned of the problem from an automaker it did not identify in October 2011 after an airbag deployment in Japan. It learned of a Honda accident in Puerto Rico the following month, according to documents filed with U.S. safety regulators.

    From February 2012 through June last year, Takata could not reproduce the problem in testing, but in autumn the supplier was alerted to three additional incidents -- two in Puerto Rico and one in Maryland -- according to documents filed with the U.S. National Highway Traffic Safety Administration.

    By October 2012, Takata concluded it was possible that the propellant in certain wafers made at its plant in Moses Lake, Wash., might be inadequately compressed, which could lead to the rupture, according to NHTSA documents.

    By March this year, it also discovered that some wafers used in inflators made at a plant in Monclova, Mexico, for a year ending in late October 2002 may have been exposed to excess moisture, which could lead to a rupture, according to documents filed with NHTSA.

    Takata is aware of only six cases where an inflator ruptured in vehicles in the field -- four in the United States and two in Japan -- as well as six cases in salvage yards in Japan, according to NHTSA documents.

    In July and August 2012 in Japan, at scrap yards where airbags were being recycled, officials noted that airbags in some Honda vehicles deployed "strangely," adding to the probe, a U.S. spokesman for Honda said.

    Industry officials said the elapsed time between the first report of a problem and the announcement of the recall was not unusual because companies typically search for patterns and possible causes of problems before launching a recall.

    Toyota said in NHTSA documents that it also received a report in October 2011 about an accident in Japan related to the issue. The automaker then asked Takata to investigate, but through August 2011 no abnormalities were found with 66 recovered inflators.

    In September 2012, Toyota said it received reports of three vehicles in the U.S. market with fractured inflators, and the automaker asked Takata to study 144 parts that were recovered.

    In February 2013, Takata said the inflators were cracked, possibly because of lower material density increasing pressure on the part, so Toyota asked the supplier to determine if a trend was developing, according to NHTSA documents. On April 5, Toyota decided to conduct its recall, three days after Takata said certain inflators could be faulty.

    In Honda's case, between 2008 and 2011, the company was forced to recall about 2.8 million vehicles after finding a defect with driver-side airbags supplied by Takata.

    "When the last recall took place, we inspected everything such as the site of manufacturing, but we were not able to identify this problem," said Hideyuki Matsumoto, a spokesman for Takata.

    Global risks

    This recall underscores the risk of huge global supply chain problems as automakers increasingly rely on a handful of suppliers for common or similar parts to cut costs.

    Paul Newton, an analyst with IHS Automotive, said the fact that no serious crashes or injuries have been connected to the defect means there should be little damage to the affected carmakers' public image.

    But at the same time, the "huge" number of vehicles involved will create "a good deal of unwelcome attention, particularly for Toyota as it strives to rebuild its reputation for quality in North America," Newton wrote in a report (see full text below).

    Some airbags at the front passenger seat may not inflate correctly because of a problem with the propellant used in the airbag inflator, Toyota spokesman Ryo Sakai said.

    Takata has also supplied the faulty airbags to non-Japanese carmakers, said Toyohiro Hishikawa, spokesman for the components maker, declining to identify them. Takata supplies airbags and seatbelts to major automakers including Ford Motor Co. and Daimler AG, as well as the Japanese brands.

    The defect was caused by problems in the manufacturing process, Matsumoto said.

    Some non-Japanese automakers were also supplied with the faulty airbags, a Takata spokesman said. He declined to name those automakers.

    General Motors Co. said Takata is a supplier, but that the problem affected only about 55,000 Pontiac Vibe cars from model year 2003 built for the U.S. and Canadian markets. The cars were assembled at the Fremont, Calif., plant GM previously ran in a joint venture with Toyota and were included in Toyota's total recall number, a GM spokesman said. GM dealers will service its cars.

    BMW has an undetermined number of vehicles affected by the recall, a U.S. spokesman for Takata said.

    Officials with Chrysler, Daimler, Ford, PSA Peugeot Citroen , Renault SA and Volkswagen AG said they were not affected because they did not use the airbags covered by the recall.

    The Takata U.S. spokesman said no other customers were affected.

    Fire risk

    Toyota said there was a risk of fires starting or passengers being injured because of the flawed inflators.

    Toyota will exchange the faulty inflators for new ones, a fix that is expected to take about an hour to two-and-a-half hours for most models, Sakai said. He declined to give the costs related to the recall.

    "The inflators themselves are not so expensive, but there is the cost to cover for the hours spent to fix the problem," said Kohei Takahashi, an autos analyst at J.P. Morgan in Japan.

    Bloomberg, Nick Bunkley and Philip Nussel contributed to this report.

    REPORT: IHS Automotive perspective

    Toyota, Honda, Nissan, and Mazda recall a combined 3.4 mil. vehicles worldwide for defective airbags

    Toyota, Nissan, Honda, and Mazda are recalling a combined 3.39 million vehicles globally, all traced back to an identical problem with the passenger-side air bag, supplied by Takata.

    Significance Toyota is the worst-hit automaker, with 1.73 million affected vehicles, followed by Honda, which has recalled 1.14 million vehicles globally.

    Implications While the recall is huge in numbers, the single-source nature of the fault and the thankful lack of serious incident should mitigate the collateral damage to reputations.

    The recall is not welcome news for Toyota as it strives to rebuild its quality reputation in North America, underlined by the media attention this routine recall has drawn.

    Four of the largest Japanese automakers – Toyota, Nissan, Honda, and Mazda – are recalling a combined 3.39 million vehicles globally for an identical problem with air bags on the passenger side, reports Agence France-Presse (AFP). Japan's transport ministry, which received recall reports from the concerned automakers, said the number of vehicles affected would reach 2.92 million. Currently, there was no explanation for the discrepancy in the total. Toyota and Nissan said the air bags were made by Tokyo-based Takata, while the ministry said the air bag parts were supplied by a single company but declined to disclose the name. Takata spokesperson Toyohiro Hishikawa said his company has been informed that global automakers, including non-Japanese manufacturers, will recall about 2 million vehicles globally due to problems with air bags it had supplied, but not 3.4 million.

    A Toyota spokesperson said his company alone was recalling a total of 1.73 million vehicles, manufactured between November 2000 and March 2004 in Japan or abroad, due to a defect in passenger-side air bags. The recall included 580,000 vehicles in North America (including 170,000 in the United States), another 490,000 vehicles in Europe and 320,000 in Japan. Affected models include the Corolla, Tundra and Lexus SC. "The involved vehicles are equipped with front passenger air bag inflators which could have been assembled with improperly manufactured propellant wafers, which could cause the inflator to rupture and the front passenger air bag to deploy abnormally in the event of a crash," the spokesperson elaborated. The spokesperson said this abnormal inflation "could also burn part of the vehicle's inside and cause fire" but denied any recorded instances of this happening. Toyota received five reports of air bag problems, three in the US and two in Japan, but there have been no injuries, added the spokesperson. Toyota will replace the faulty inflator with new ones, a fix that is expected to take about an hour to two-and-a-half hours for most models, said the spokesperson, without disclosing the costs related to the recall.

    Nissan and Honda released statements giving similar explanations. A Nissan spokesperson said the company was recalling a total of 480,000 vehicles globally, all of which were manufactured in Japan between August 2000 and January 2004. The Yokohama-based automaker said vehicles in North America and Europe were also affected but could not furnish details. Recalled models in Japan include the Cube, X-Trail, Maxima and Teana. Honda is recalling 1.14 million vehicles worldwide, with about 680,000 in North America, 270,000 in Japan and 64,000 in Europe. Affected models include the Civic, CR-V and Odyssey.

    Mazda said its recall target would reach 45,463 units worldwide, including 4,384 at home, with affected models including the RX-8 and Mazda6. The recall apparently extends to Latin America, China, the Middle East, and Africa, and will be reported later in the day in accordance with local regulations of each country.

    Outlook and implications

    The huge recall is expected to generate a good deal of unwelcome attention, particularly for Toyota as it strives to rebuild its reputation for quality in North America. The current recall is reportedly the fourth Toyota recall since October last year to involve more than a million cars, and the second this year after the one in January. The announcement comes as the company has been steadily rebuilding market share in the region following the recall of 2009–10 that was related to unintended acceleration problems and the supply problems experienced following the Northeast Japan earthquake disaster.

    For Nissan, too, the recall follows the one in March when it said it will recall five 2013 model-year vehicles in the US due to faulty sensors that can permanently turn off the front seat passenger air bag. That recall, expected to begin this month, involves Altima, Sentra, Pathfinder, Infiniti JX35 SUVs and Leaf electric vehicle.

    Takata derives nearly 75% of its revenues from outside Japan and this is the biggest recall involving the company since 1995, when several automakers called back a record 9 million vehicles to replace faulty seat belts supplied by the company. Takata is the second-largest manufacturer of automotive safety parts globally.

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