U.S. Safety Regulators Fine Takata Millions Over Defective Airbags

U.S. automotive safety regulators have announced that Japanese auto supplier Takata has agreed to accept penalties for failures in its handling of issues with exploding airbags that have killed at least 8 people and injured at least 98.

Could this news mark the end of the Takata faulty airbag scandal?

The National Highway Traffic Safety Administration (NHTSA) will fine Takata at least $70 million and could increase that penalty up to $200 million if the supplier doesn’t adequately comply with a plan to accelerate recalls of defective airbags and eliminate a chemical that may have caused the incidents. This marks the largest civil penalty in the NHTSA’s history.

In yet another blow to the company, Honda said that Takata had “misrepresented and manipulated test data” on airbag inflators and that the automaker would therefore not use the Japanese auto supplier’s airbags in any of its future products.

The NHTSA said Takata acknowledged “that it was aware of a defect but failed to issue a timely recall.”

Consequently, the Department of Transportation is leveraging a never-before-used authority to force Takata and major automakers to speed their efforts to fix 19 million vehicles that are fitted with potentially defective airbags. The NHTSA will also appoint a monitor to oversee Takata’s airbag recall, which must be completed approximately two years earlier than previously planned.

Transportation Secretary Anthony Foxx said that Takata had fired employees as a result of the federal investigation, but he wasn’t aware of how many. Additionally, he said that Takata had moved from “kicking and screaming” over the suggestion that its airbags were defective to an admission of fault.

“For years, Takata has built and sold defective products, refused to acknowledge the defect, and failed to provide full information to NHTSA, its customers, or the public,” said Foxx. “American drivers should not have to worry that a device designed to save their life might actually take it.”

For its side, Takata said that it is “committed to being part of the solution” through further investigation of the matter, accelerated recalls and improved safety procedures.

“We deeply regret the circumstances that led to this,” said Takata CEO Shigehisa Takada. “This settlement is an important step forward for Takata that will enable us to focus on rebuilding the trust of automakers, regulators and the driving public.”

Although the root cause of the exploding airbags remains a mystery, federal investigators suspect that it may be related to ammonium nitrate propellant. As part of the consent agreement, Takata must phase out the use of this agent unless it can prove that it’s not related to the problem. The NHTSA also left open the possibility that it will require the company to recall all of the airbags that it has ever produced with ammonium nitrate.

Foxx said he suspects that “millions more” vehicles may be recalled once the NHTSA finishes its probe into Takata’s airbags.