Japan-based Takata Corporation faces a penalty of up to $200 million due to the company’s faulty and defective airbags, which can explode and send metal shrapnel towards drivers and passengers upon impact after a crash. This would be the largest penalty ever imposed by the National Highway Traffic Safety Administration (NHTSA).
“Today, we are holding Takata responsible for its failures, and we are taking strong action to protect the traveling public,” said NHTSA Administrator Mark Rosekind. “We are accelerating Takata recalls to get safe air bags into American vehicles more quickly, ensuring that consumers at the greatest risk are protected, and addressing the long-term risk of Takata’s use of a suspect propellant.”
U.S. auto safety regulators will fine the airbag manufacturer $70 million as part of the case settlement. An additional $130 million in civil penalties could be enforced if Takata does not comply with the settlement terms.
With a recall of 23.4 million driver and passenger airbag inflators on 19.2 million U.S. vehicles sold by 12 automakers, this airbag defect has been linked to eight deaths and more than 100 injuries worldwide. Takata reportedly knew of defects in its airbags, conducting secret tests of the product which showed dangerous flaws. Rather than alert federal safety regulators to the risks, Takata executives allegedly ordered engineers to delete test data.
As part of the settlement, Takata has admitted that it was aware of the defect and failed to report this information to authorities for a “timely recall.” Instead, “Takata provided NHTSA with selective, incomplete or inaccurate data dating back to at least 2009,” according to NHTSA findings.
“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 Transportation Secretary Anthony Foxx. “The result of that delay and denial has harmed scores of consumers and caused the largest, most complex safety recall in history. Today’s actions represent aggressive use of NHTSA’s authority to clean up these problems and protect public safety.”