$70 Million Fine for Japanese Manufacturer over Exploding Airbags

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Helen Jones
Executive Vice President 

On November 3, 2015, U.S. auto safety regulators fined Japanese company, Takata Corp., $70 million for concealing evidence that safety airbag inflators manufactured by the company are prone to explode. This defect has reportedly been linked to over 100 injuries and eight deaths worldwide. Since news of the defect became public knowledge, over 23.4 million airbag inflators, used in 12 different vehicles, have been recalled in the U.S. Following the news of the fine, Honda, Takata’s biggest client, announced they will no longer use the company’s airbag inflators.

Takata has promised to phase out use of ammonium nitrate, the substance identified as the cause of the defect, over the next two years. If Takata fails to adhere to the agreement the fine may increase to as much as $200 million. The company has admitted that it knew about the defect for years; however, it avoided recalling the product by withholding crucial information regarding the defect. Specific injuries caused by the defect in the airbag inflators include shrapnel being launched at the passengers of the car.

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