Takata profit push may have harmed safety: Senate report

[June 23, 2015]  By Ben Klayman
 
 DETROIT (Reuters) - Air bag maker Takata Corp may have put profits before safety in a way that contributed to one of the biggest and most complex auto recalls ever, Democrats on a U.S. Senate committee said in a report released on Monday.

The report by the minority on the Senate Commerce Committee was released the day before a Washington hearing on Takata's defective inflators.

Those faulty parts have been linked to hundreds of injuries and at least eight deaths globally - all in Honda Motor Co Ltd vehicles - because of air bags that deploy with too much force and spray metal shards at passengers.

"Internal emails obtained by the committee suggest that Takata may have prioritized profit over safety by halting global safety audits for financial reasons," the Democrats said in their report.

The Democrats said Takata emails indicate plant safety audits were halted from 2009 to 2011 "due to financial reasons."

“The more evidence we see, the more it paints a troubling picture of a manufacturer that lacked concern,” Bill Nelson, a Democratic senator from Florida, said in a statement.

Takata said the report contained "a number of inaccuracies" and that internal emails reviewed by the committee had been taken out of context and characterized in a way that "creates a false impression."

"The global audits referenced in the emails relate to the safe handling by employees of pyrotechnic materials – they were not, as the report implies, related to product quality or safety," Takata said.

A spokesman for the committee’s Republican majority declined to comment on the minority report.

Since 2008, 10 automakers have announced recalls involving ruptured inflators in Takata air bags. Dealers have been replacing the defective units as new parts become available from Takata and, more recently, from other suppliers.

The Senate minority report also criticized U.S. regulators for not catching the problem years earlier and questioned whether some of the replacement inflators might eventually need to be recalled.

The report cited Takata documents showing the company "frequently made adjustments" to reduce the moisture in the explosive propellant used in inflators once problems with its air bags came to light.

Analysts have said the propellant Takata uses - ammonium nitrate - is more volatile than material used by rivals, and can be damaged by exposure to moisture. It is also less costly and emits less toxic fumes than other materials.

Takata has said high moisture levels were a potential factor in the ongoing problem with exploding inflators.

A Takata executive said at a congressional hearing earlier this month that the company planned to continue using ammonium nitrate, including a newer version of the compound that does not react as violently to moisture.

(Reporting by Ben Klayman in Detroit and David Morgan in Washington. Editing by Andre Grenon)

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