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Material and Parts Failure – 42 million Cars Recalled for faulty Airbags

Posted on March 6th, 2017 by in Chemical Manufacturing Excellence

Airbags

(Source: The Legal Examiner, http://kansascity.legalexaminer.com, October 19, 2016)

At a 1985 New Year’s party hosted by Honda Motor, Juichiro Takada the inheritor of the woven-cloth fortune disclosed a decision his company had made. His company, Takata Corp., would not enter into the airbag business – the newest idea in car safety at that time.¬† The concept was to insert cushioning bags in steering wheels of cars. The bags would inflate within a small fraction of a second after the car had experienced impact in an accident. He though it was just too risky because a small mistake could destroy the Company he had inherited from his father. He said, “We cannot cross a bridge that is so dangerous.”

Somewhere along the road Mr. Takada changed his mind and his company crossed the bridge and entered the airbag business in 1988. Takata was making airbags and their inflating mechanisms.  It is a technology, borrowed from rocket engines, that uses high-explosive pyrotechnic devices to inflate the bags.  This was a gamble a long ways from woven cloth manufacturing.  It paid off spectacularly and helped airbags evolve from a costly option to standard equipment on tens of millions of cars. Takata became one of the top airbag manufacturers, along with Delphi and TRW, with a global business and factories around the world.

Initially, Takata was using tetrazole, considered a reliable and stable compound, as the airbag propellant.  By 2001 Takata had switched to an alternative formula in which ammonium nitrate replaced tetrazole, a more expensive compound.  Takata claims the switch to an ammonium-nitrate-based propellant was not driven by cost considerations.  Instead, the Company’s engineers determined that the compound produced gas more efficiently with fewer emissions.  Previously the major applications of ammonium nitrate included fertilizers and explosives for mining and construction demolitions.  Takata engineers and other employees had concerns over switching to such a risky compound.  Never the less the Company proceeded to make the change (Source: New York Times, Nov 19, 2014).

In 2013, Mr. Takada’s (deceased in 2011) fears came true when Toyota, Nissan and Honda recalled nearly 3.5 million cars worldwide.  The cause of the recall was defective airbags supplied by Takata Corp. The bags could explode unexpectedly with too much force and released flying metal fragments.  Toyota’s 2013 recall involved 1.7 million vehicles produced between November 2000 and March 2004.  Takata had also supplied airbags to non-Japanese auto manufacturers.  The scope of the recalls grew with time involving virtually every automaker raising the total number of suspect bags to 100 million in the United States.  Defective airbags made by Takata have been tied to at least 11 deaths and over 180 injuries in the United States alone. To make matters worse, Takata reacted defensively to the discovery of the defective airbags and was slow to providing information to the rightfully concerned public.

At the heart of the defect is the ammonium nitrate, a dangerously volatile compound that acts like a propellant to create a small explosion that inflates the airbags in a crash. Ammonium nitrate is housed in an inflator, a metal canister designed to contain the explosion. But, ammonium nitrate can deteriorate and become unstable over time or when it is exposed to moisture in high heat and humidity, causing the propellant to burn too fast; blow apart the metal canister; and send shrapnel into the necks and faces of vehicle occupants. (Source: The Legal Examiner, http://kansascity.legalexaminer.com, October 19, 2016)

Takata has been investigating the cause of explosions but has yet to produce a final report for submission to National Highway Traffic Safety Administration (NHTSA).  A group of ten automakers hired a rocket science team to find the definitive cause of the ruptures. The team found exposure of ammonium nitrate to humidity; design and manufacturing problems were the root causes of the bag explosions.  The compound became unstable when a car is exposed to moisture or temperature swings over time, leading to a risk of explosion as a result of even a mild impact.

On February 27, 2017, Car and Driver (Source: www.caranddriver.com) reported on documents obtained by Reuters indicating quality control problems with airbags at Takata factories.¬† The documents show that as early as in 2002, Takata‚Äôs plant in Mexico allowed a defect rate that was ‚Äúsix to eight times above‚ÄĚ acceptable limits, or roughly 60 to 80 defective parts for every one-million airbag inflators shipped.¬† These numbers may seem small but mean 60-80 deaths or serious injury.

The extent of the problem is enormous: NHTSA has ordered a nationwide recall of more than 42 million cars, the largest automotive recall in the history of the United States.  According to Car and Driver Takata has officially pleaded guilty to criminal wire fraud for covering up the engineering defects that have led to at least 17 deaths and hundreds of injuries.  This is the largest global recall ever in the automotive history. The guilty plea comes six weeks after a US Justice Department announcement that Takata had agreed to a $1 billion settlement, including $850 million to compensate automakers for repairs, $125 million for a victim settlement fund, and a $25 million criminal fine. Three Takata executives have been charged with fraud.

Surely Takata Corp entered the new business, as any company would, with the best intentions.  Why did then the Company land in this monumental disaster?  Until in-depth studies are done one can only identify the fairly obvious causes of Takata’s fiasco.  Consider the original core competency of Takata Corp since being founded in 1933.  The Company had a core competency of weaving textiles during the first few decades of its existence.  It entered into the seat belt business, which is considered an application of textile goods.

An early (and unheeded) warning came about in May 1995 when Takata seat belts affecting nearly 8.5 million US cars were recalled.¬† It was called at the time the “second largest recall in the 30 year history of the Department of Transportation (DOT)”.¬† The cause: seat belt buckles either failing to latch, latching and releasing automatically, or releasing in accidents.¬† In other words the seat belts did not perform their one and only function.¬† The nature and magnitude of the recall should have caused Takata to pause and do a lot of soul searching.¬† It is unclear what lessons the Company drew from the 1995 seat belt fiasco.

Takata’s entry into airbags, that included manufacturing critical components, was a significant leap away from its 50-year old core competency.  None of Takata’s past experiences had prepared them for manufacturing a controlled explosion.  The evidence is its decision to switch to ammonium nitrate even though all its competitors stayed away from that compound.

The cost reduction Takata offered automakers resulted in unrelenting pressure from automakers, first Japanese and then others, to supply millions of bags.  The rapid growth in global demand required Takata to build manufacturing facilities around the world and establish distant supply chains quickly.

Takata lacked expertise in managing factories in countries with cultures vastly different from Japan’s.  Learning to manage a global business requires spending a great deal of time, as is also the case with learning and teaching quality control and manufacturing excellence.  Takata’s rapid growth was in direct conflict with taking the required time to work the bugs out of its manufacturing methods and quality control.

In commenting on Takata, Mark Johnson, an expert in supply chain management at Britain’s Warwick Business School summarized the saga well: “You’ve almost got this perfect storm of an increase in the volume of cars being sold and very, very rapid implementation of technology.” (Source: Automotive News, www.autonews, January 16, 2014)

NHTSA’s tally of affected vehicles can be found at www.safercar.gov/rs/takata/takatalist.html.  For further information about your specific vehicle, go to the manufacturer’s consumer website or use NHTSA’s VIN-lookup tool at https://vinrcl.safercar.gov/vin.


 

All opinions shared in this post are the author’s own.

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