Japan Transport Ministry Weighs Additional Air Bag Recalls

By and | December 2, 2014

Japan’s investigation into dangerous air bags is leading to a remote scrapyard in the central Gifu prefecture, where the explosion of a car model not included in current recalls suggests automakers may have to yet again expand their safety campaigns.

In the latest incident, an air bag from Takata Corp., the Tokyo-based company at the center of the crisis, deployed with such force that it shattered the windshield and sprayed metal shards on the floor of the Toyota Motor Corp. subcompact, said Akihiro Wakayama, a manager at the Chikamatsu Shokai Co. scrapyard. The explosion last month sounded “like a gunshot” and was “two to three times” louder than normal, he said.

Japan’s transport ministry is investigating the cause of the malfunction to determine whether more vehicles need to be recalled. The 2003 Toyota WiLL Cypha wasn’t among the 2.6 million subject to safety campaigns in Japan.

“I was surprised once again because the unusual explosion occurred in a vehicle that we were told to be safe,” Wakayama, 43, said in an interview in the city of Seki in central Japan. “That made me think we really don’t know what we can trust to do our work safely.”

The air bag in the Toyota was the seventh to have ruptured at scrapyards in Japan since June 2012, where 350,000 of the devices made by Takata were evaluated and recycled every year, according to transport ministry official Masato Sahashi. The previous six ruptures — four in Honda Motor Co.’s Fit and two in Toyota’s Corolla — were reported around July 2012 and led to an additional 3 million vehicles being recalled globally.

Toyota said last week that it is still investigating the issue.

Special Order

Takata is facing global investigations into the safety of its air bags. The company has submitted its response to a 36-question special order by the National Highway Traffic Safety Administration, spokesman Toyohiro Hishikawa said by phone.

NHTSA had said the auto-parts maker needed to respond by Dec. 1 or face a $35 million fine. The order sought information on factory quality control, use of contaminated or improperly formulated propellant and a complete accounting of deaths and injuries, among other questions.

Takata also faces a hearing by the U.S. House Energy and Commerce Committee on Dec. 3 and must respond by Dec. 2 to NHTSA’s demand that driver’s side air-bag recalls be expanded nationwide.

Share Reaction

The company’s shares pared gains in intraday trading after the description of the scrapyard explosion and rebounded as Takata said it submitted its response to NHTSA. The stock gained 3.1 percent to 1,336 yen at the close in Tokyo.

As part of Japan’s Automobile Recycling Law implemented in 2005, dismantlers are required to deploy or remove the air bags before scrapping the vehicles. They are asked to report any malfunction during the process to automakers to investigate whether a recall is needed.

The transport ministry is requiring carmakers to report any scrapyard ruptures as soon as possible and has set up a group that meets daily with Takata to monitor the progress of the recalls. The ministry doesn’t have statistics on the percentage of recalls that originated from malfunction reports from scrapyards.

Takata’s air bags are linked to at least four deaths in Honda Motor Co. vehicles in the U.S., where the National Highway Traffic Safety Administration is trying to determine why the devices are deploying with too much force and shooting metal shrapnel at vehicle occupants.

Malaysian Death

Last month, Honda reported a death in Malaysia, raising concerns about more cases in emerging markets where safety reporting standards and regulatory oversight are laxer.

About 13 million vehicles have been called back by 11 carmakers globally to date over Takata’s air bags. In Japan, four ruptures were reported in vehicles in use, though there were no injuries or fatalities because the seats were not occupied when the air bags deployed.

“It’s not clear where the crisis is heading,” said Satoshi Yuzaki, who oversees stock market research at Takagi Securities Co. in Tokyo. “Takata hasn’t assured us they have everything under control and keeps dealing with new recalls. We don’t see light at the end of tunnel yet.”

Kikko Takai, Takata spokeswoman, said that determining the root cause of the malfunction is the company’s top priority and reiterated an apology for the “inconvenience and trouble” caused.

Piecemeal Approach

The U.S. traffic safety regulator has said that the Tokyo-based company’s piecemeal approach to fixing a potentially deadly flaw in millions of cars is insufficient.

The company is expected to extend its regional recall of driver-side air bags to the entire U.S., the Nikkei reported today, without saying where it got the information. Takata earlier had pushed back against calls by NHTSA to broaden the safety campaigns.

Back at Wakayama’s scrapyard in Japan, about 30 to 40 vehicles bought from used-car dealers are brought in to be scrapped each day.

Since the recalls escalated in the past year, the workers check to see if the vehicles are on the recall lists for defective air bags, which are removed and returned to the automakers as they’re considered too dangerous to detonate.

Despite the checks, cases like the Toyota WiLL Cypha occasionally slip through. In an earlier incident, metal shrapnel from a ruptured air bag installed in a Nissan Cube penetrated the windshield and punched a hole in the ceiling of the hall where the detonation took place. After that, the workers took to covering the cars with thick blankets.

“I tell our workers to be cautious no matter what cars you’re working on,” said Wakayama, the scrapyard manager. “They can’t seem to find the root cause, which makes people like us who have to deal with airbags anxious. We feel like this issue is endless.”

–With assistance from Craig Trudell in Tokyo.

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