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Takata To Pay $1 Billion In Guilty Plea After Largest Air Bag Recall Automotive History
Takata Air Bag Lawsuits Were Also Filed Against Automakers Who Continued Using Takata’s Exploding Air Bags That Caused Serious Injuries And Death.
akata Corp., the largest air bag manufacturer worldwide, pleaded guilty to fraud Monday and agreed to pay $1 billion in penalties for concealing a defect in its now-recalled airbag. The Japan-based auto parts dealer admitted to hiding evidence that its airbag inflators could violently explode and send shrapnel into drivers and passengers, causing serious injuries or death.
The $1 billion in penalties include $850 million in restitution to automakers, $125 million for victims and families, and a $25 million criminal fine, according to Associate Press. The airbag inflators caused 16 deaths, of which 11 occurred in the United States, and more than 180 injuries globally. In addition to being charged with fraud, three former Takata executives based in Japan are charged with falsifying test reports.
Takata’s recall of up to 69 million inflators and 42 million vehicles is the largest recall in U.S. automotive history. The company’s recall in the United States was prompted by the National Highway Traffic Safety Administration’s letter in December 2014 that forced Takata to comply with the federal agency’ air bag recall demand.
At a Congressional hearing in June 2015, Takata officials indicated that air bag explosions stemmed from the chemical mixture used to inflate the bag. Company officials said ammonia nitrate is used to create a small explosion that inflates the air bags during a crash. In hot and humid climates with frequent temperature changes, the chemical mixture can deteriorate and burn too fast. When the air bag deploys, the force blows apart the metal canister housing the bag, sending shrapnel through the vehicle.
Takata’s recalled air bags have also spurred lawsuits accusing automakers of knowing about the air bag defect but installing them anyway in millions of their vehicles. According to the Associated Press, dozens of lawsuits were filed in Miami on Monday, the same day Takata’s chief financial officer was in a federal court in Detroit pleading guilty to the air bag fraud charge. The lawsuits accuse BMW, Ford, Honda, Nissan and Toyota of putting their customers in danger by using the air bags.
Automakers previously contended that they should not be held liable over injuries involving the defective air bags because Takata deceived them about the problem. In its plea agreement with Takata, the U.S. Justice Department said Takata was able to get automakers to continue buying its inflators “through submission of false and fraudulent reports and other information that concealed the true and accurate test results.”