How Takata became a dirty word

It started in the early 2000s. That’s when Takata started tinkering with ammonium nitrate, a chemical compound used to inflate its airbags, one of the company’s most lucrative endeavors. The Japanese manufacturer favored the chemical compound over other options, even as the compound came into question because of its vulnerability to changing temperatures and moisture. It’s been pointed out that Takata knew about the liabilities since 2004.

Years and several lawsuits later, Takata is finding out how damaging that decision has become. Clients like Mitsubishi, Toyota, Honda and other automakers are distancing themselves from what has turned into the biggest automotive safety recall in history. On November 3, the National Highway Traffic and Safety Administration administered the largest civil penalty in its existence against Takata. The grand total comes out to $200 million, a total that Takata may not be able to overcome.

The NHTSA, a division of the U.S. Department of Transportation, announced that it had issued two orders designed to protect drivers and travelers from Takata airbag inflators, the culprit that utilizes the phase-stabilized ammonium nitrate propellant to inflate its airbags. The propellant reportedly causes explosive ruptures that have been linked to at least eight deaths and hundreds of injuries.

Takata must now face the consequences for violating the Motor Vehicle Safety Act and cease production of inflators that use phase-stabilized ammonium nitrate propellant. The NHTSA is going the extra mile by seeking an independent monitor to keep tabs on Takata and its operations, an oversight period that will last for five years. (The NHTSA is currently seeking qualified candidates to apply for the position.)

The U.S. has ordered automakers to replace Takata airbags in 19 million vehicles, a process that could take as long as four years. But as auto partners begin shunning Takata parts in an effort to protect their reputation, consumers may be the ones who suffer the consequences. If Takata goes under as a result of the penalties and loss of business (airbags account for 40% of its business), there’s questions as to who/what will be responsible for replacing the defective airbags.

The NHTSA has come out with a list of cars and trucks from 12 different automakers deemed Priority One for replacement of Takata airbag inflators. The list includes makes from BMW, Fiat-Chrysler, Ford, General Motors, Honda, Mazda, Mitsubishi, Nissan, Suburu and Toyota. Takata’s partners continue to bail out, consumers continue to sue and a federal agency continues to monitor operations. That will easily turn your company into a dirty word.

Complete list of recalled vehicles is below (Source: NHTSA). Do you own of one of these cars? Do you have questions about your legal recourse? Give us a call.