[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
TAKATA AIRBAG RUPTURES AND RECALLS
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON COMMERCE, MANUFACTURING, AND TRADE
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
DECEMBER 3, 2014
__________
Serial No. 113-183
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the Committee on Energy and Commerce
energycommerce.house.gov
______
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COMMITTEE ON ENERGY AND COMMERCE
FRED UPTON, Michigan
Chairman
RALPH M. HALL, Texas HENRY A. WAXMAN, California
JOE BARTON, Texas Ranking Member
Chairman Emeritus JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky Chairman Emeritus
JOHN SHIMKUS, Illinois FRANK PALLONE, Jr., New Jersey
JOSEPH R. PITTS, Pennsylvania BOBBY L. RUSH, Illinois
GREG WALDEN, Oregon ANNA G. ESHOO, California
LEE TERRY, Nebraska ELIOT L. ENGEL, New York
MIKE ROGERS, Michigan GENE GREEN, Texas
TIM MURPHY, Pennsylvania DIANA DeGETTE, Colorado
MICHAEL C. BURGESS, Texas LOIS CAPPS, California
MARSHA BLACKBURN, Tennessee MICHAEL F. DOYLE, Pennsylvania
Vice Chairman JANICE D. SCHAKOWSKY, Illinois
PHIL GINGREY, Georgia JIM MATHESON, Utah
STEVE SCALISE, Louisiana G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio JOHN BARROW, Georgia
CATHY McMORRIS RODGERS, Washington DORIS O. MATSUI, California
GREGG HARPER, Mississippi DONNA M. CHRISTENSEN, Virgin
LEONARD LANCE, New Jersey Islands
BILL CASSIDY, Louisiana KATHY CASTOR, Florida
BRETT GUTHRIE, Kentucky JOHN P. SARBANES, Maryland
PETE OLSON, Texas JERRY McNERNEY, California
DAVID B. McKINLEY, West Virginia BRUCE L. BRALEY, Iowa
CORY GARDNER, Colorado PETER WELCH, Vermont
MIKE POMPEO, Kansas BEN RAY LUJAN, New Mexico
ADAM KINZINGER, Illinois PAUL TONKO, New York
H. MORGAN GRIFFITH, Virginia JOHN A. YARMUTH, Kentucky
GUS M. BILIRAKIS, Florida
BILL JOHNSON, Missouri
BILLY LONG, Missouri
RENEE L. ELLMERS, North Carolina
Subcommittee on Commerce, Manufacturing, and Trade
LEE TERRY, Nebraska
Chairman
JANICE D. SCHAKOWSKY, Illinois
LEONARD LANCE, New Jersey Ranking Member
Vice Chairman JOHN P. SARBANES, Maryland
MARSHA BLACKBURN, Tennessee JERRY McNERNEY, California
GREGG HARPER, Mississippi PETER WELCH, Vermont
BRETT GUTHRIE, Kentucky JOHN A. YARMUTH, Kentucky
PETE OLSON, Texas JOHN D. DINGELL, Michigan
DAVE B. McKINLEY, West Virginia BOBBY L. RUSH, Illinois
MIKE POMPEO, Kansas JIM MATHESON, Utah
ADAM KINZINGER, Illinois JOHN BARROW, Georgia
GUS M. BILIRAKIS, Florida DONNA M. CHRISTENSEN, Virgin
BILL JOHNSON, Missouri Islands
BILLY LONG, Missouri HENRY A. WAXMAN, California, ex
JOE BARTON, Texas officio
FRED UPTON, Michigan, ex officio
C O N T E N T S
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Page
Hon. Lee Terry, a Representative in Congress from the State of
Nebraska, opening statement.................................... 1
Prepared statement........................................... 3
Hon. Janice D. Schakowsky, a Representative in Congress from the
State of Illinois, opening statement........................... 4
Hon. Fred Upton, a Representative in Congress from the State of
Michigan, opening statement.................................... 5
Prepared statement........................................... 6
Hon. Henry A. Waxman, a Representative in Congress from the State
of California, prepared statement.............................. 7
Witnesses
Hiroshi Shimizu, Senior Vice President for Global Quality
Assurance, Takata Corporation.................................. 9
Prepared statement........................................... 11
Answers to submitted questions............................... 104
Rick Schostek, Executive Vice President, Honda North America..... 16
Prepared statement........................................... 18
Answers to submitted questions............................... 150
Craig Westbrook, Vice President, Aftersales, BMW of North America 23
Prepared statement........................................... 25
Answers to submitted questions............................... 201
Abbas Saadat, North American Regional Product Safety Executive,
Vice President, Vehicle Safety and Compliance Liaison Office,
Toyota......................................................... 29
Prepared statement........................................... 31
Answers to submitted questions............................... 211
David J. Friedman, Deputy Administrator, National Highway Traffic
Safety Administration.......................................... 65
Prepared statement........................................... 67
Answers to submitted questions............................... 250
Submitted material
Takata test results by the National Highway Traffic Safety
Administration, submitted by Mr. Waxman........................ 89
Letter of December 2, 2014, from Takata to the NHTSA, submitted
by Ms. Schakowsky.............................................. 93
Article entitled, ``Takata's Switch to Cheaper Airbag Propellant
is at Center of Crisis,'' New York Times, November 19, 2014,
submitted by Mrs. Blackburn.................................... 97
Article entitled, ``Airbag Maker Takata Saw and Hid Risk in 2004,
Former Workers Say,'' CNBC, November 7, 2014, submitted by Mr.
Upton.......................................................... 100
TAKATA AIRBAG RUPTURES AND RECALLS
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WEDNESDAY, DECEMBER 3, 2014
House of Representatives,
Subcommittee on Commerce, Manufacturing, and Trade,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 10:03 a.m., in
room 2123, Rayburn House Office Building, Hon. Lee Terry
(chairman of the subcommittee) presiding.
Present: Representatives Terry, Lance, Blackburn, Harper,
Guthrie, Olson, McKinley, Kinzinger, Bilirakis, Long, Barton,
Upton (ex officio), Schakowsky, Sarbanes, Welch, Yarmuth,
Matheson, Barrow, and Waxman (ex officio).
Also Present: Representative Burgess.
Staff Present: Charlotte Baker, Press Secretary; Sean
Bonyun, Communications Director; Leighton Brown, Press
Assistant; Graham Dufault, Policy Coordinator, CMT; Melissa
Froelich, Counsel, CMT; Kirby Howard, Legislative Clerk; Paul
Nagle, Chief Counsel, CMT; John Ohly, Professional Staff
Member, O&I; Olivia Trusty, Professional Staff Member; Michelle
Ash, Minority Chief Counsel, Commerce, Manufacturing and Trade;
Jen Berenholz, Minority Chief Clerk; Peter Bodner, Minority
Counsel; Stacia Cardille, Minority Chief Counsel; Brian Cohen,
Minority Staff Director, Oversight & Investigations, Senior
Policy Advisor; Lisa Goldman, Minority Counsel; Debbie Letter,
Minority Staff Assistant; Elizabeth Letter, Minority
Professional Staff Member; Karen Lightfoot, Minority
Communications Director and Senior Policy Advisor; and Nicholas
Richter, Minority Assistant Staffer.
OPENING STATEMENT OF HON. LEE TERRY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEBRASKA
Mr. Terry. I want to welcome everyone to our hearing today
for the Commerce, Manufacturing, and Trade Subcommittee. This
is our last hearing of this congressional session, assuming no
emergency for next week. So next year, Mr. Burgess, as I
understand, is going to take over the gavel for this
subcommittee, and so even though he is not currently a member
of the subcommittee is joining us today to just kind of get a
feel for the importance of this subcommittee, and certainly,
the importance of this hearing today.
So the title of this hearing is ``Takata Airbag Ruptures
and Recalls.'' Safety recalls are often marked by tragedy; that
is what brings it to our attention. But they are even more
troubling when the very equipment being recalled is intended to
save lives. Now, this morning we will begin piecing together
the history of a safety defect that became known only by what
appears to us as fits and starts, and seemingly has several
potential causes.
The first known rupture occurred in 2004 in Alabama. Three
more ruptures in 2007 led Takata to identify a bad stamp press
at a manufacturing facility in Moses Lake, Washington. In 2008,
Honda recalled 3,940 cars in the U.S., however, two more
airbags ruptured in May and June of 2009, one of which killed
the driver. At that point, it appears that Takata believed the
airbag inflators were being improperly exposed to moisture
during the production process. However, around the same time,
Takata confirmed that a stamp press was to blame for the at-
risk airbags.
In early 2011, uncertainty about the cause of the
continuing ruptures led to another recall. And previous recalls
were expanded in late 2012 upon the discovery that Takata's
production records were in disarray. NHTSA, Takata, and car
manufacturers all indicate that the vehicles with faulty
airbags tied to manufacturing or storage issues have been
recalled. And yet, several more ruptures subsequently occurred
in southern states. This led manufacturers and NHTSA to believe
that the prolonged exposure to high absolute humidity levels
was a major contributing factor. However, NHTSA recently
demanded that manufacturers broaden the current recalls in
southern states to the national level.
NHTSA believes that the recent incidents in California and
North Carolina indicate the possibility of ruptures in areas
with lower absolute humidity. I understand Takata disagrees
with NHTSA's assessment, and I look forward to learning more
about that, while the OEMs that are before us today have all
stated publicly that they are willing to do a national recall.
Now, there are several questions here to address. For
example, are the current testing methods adequate? How much
testing is enough to determine a cause and how quickly it is
being carried out? What is the appropriate level of
coordination between NHTSA automakers and their suppliers? What
metric should be used to determine whether a recall is
necessary? There are also questions about the supply of
replacement parts and whether those replacement parts are truly
safer than the parts being recalled.
Our highway safety depends on the vigilance of
manufacturers as well as NHTSA. Sometimes the regulator is in
the best position to defend the defect, and sometimes it is the
manufacturer. The time has come to bring the facts together and
make sure that the unsafe airbag inflators are off the market.
Consumers can get their faulty parts replaced and the future
recalls are handled better. The safety of American drivers
depend on our collective success.
So I thank the witnesses for being here today and help
achieve these goals and put a stop to this deadly problem, and
there is 1 minute left of mine.
Marsha, would you like to claim that?
Mrs. Blackburn. Yes. Thank you, Mr. Chairman.
Mr. Terry. Yield to you.
[The prepared statement of Mr. Terry follows:]
Prepared statement of the Hon. Lee Terry
Safety recalls are often marked by tragedy. But they are
even more troubling when the very equipment being recalled is
intended to save lives.
This morning we will begin piecing together the history of
a safety defect that became known only by fits and starts, and
seemingly has several potential causes.
The first known rupture occurred in 2004 in Alabama. Three
more ruptures in 2007 led Takata to identify a bad stamp press
at a manufacturing facility in Moses Lake, Washington.
In 2008, Honda recalled 3,940 cars in the U.S. However, two
more airbags ruptured in May and June 2009, one of which killed
the driver.
At that point, it appears that Takata believed the airbag
inflators were being improperly exposed to moisture during the
production process. However, around that same time, Takata
confirmed that a stamp press was to blame for at-risk airbags.
In early 2011, uncertainty about the cause of the
continuing ruptures led to another recall. And previous recalls
were expanded in late 2012 upon the discovery that Takata's
production records were in disarray.
NHTSA, Takata and car manufacturers all indicate that the
vehicles with faulty airbags tied to manufacturing or storage
issues have been recalled.
And yet several more ruptures subsequently occurred in
southern states. This led manufacturers and NHTSA to believe
that prolonged exposure to high absolute humidity levels was a
major contributing factor.
However, NHTSA recently demanded that manufacturers broaden
the current recalls in southern states to the national level.
NHTSA believes that recent incidents in California and North
Carolina indicate the possibility of ruptures in areas with
lower absolute humidity.
I understand Takata disagrees with NHTSA's assessment and I
look forward to learning more about that.
So there are several questions to address:
For example, are current testing methods adequate?
How much testing is enough to determine a cause and how
quickly is it being carried out?
What is the appropriate level of coordination between
NHTSA, auto-makers and their part suppliers?
What metric should be used to determine whether a recall is
necessary?
There are also questions about the supply of replacement
parts and whether those replacement parts are truly safer than
the parts being recalled.
Our highway safety depends on the vigilance of
manufacturers as well as NHTSA. Sometimes the regulator is in
the best position to find the defect and sometimes it's the
manufacturer.
The time has come to bring the facts together and make sure
the unsafe airbag inflators are off the market, consumers can
get their faulty parts replaced, and future recalls are handled
better.
The safety of America's drivers depends on our collective
success on those fronts.
Mrs. Blackburn. Thank you. And I thank our witnesses also
for being here. And as the chairman said, 2004 is the first
time we knew of this issue. It was when the first inflator
exploded, and then we go through the process of looking at the
propellent change and finding out when the change was made
going to ammonium nitrate in 2001.
Now, we do hope that this hearing is going to give us an
opportunity to talk with you about the decision-making process,
who was involved in that, why they made the decisions that they
did. We will drill down on that. We are very disappointed in
Takata refusing to work with NHTSA on the deadline for a
national recall of the driver's side airbags that expired last
night. We will want to address that with you.
We welcome our witnesses. And I am finishing right on time,
Mr. Chairman. Back to you.
Mr. Terry. Well done.
Now the chair recognizes the ranking member, the gentlelady
from Illinois, for 5 minutes.
OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A
REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS
Ms. Schakowsky. Thank you, Mr. Chairman, for holding this
important hearing today.
Before I turn to today's business, I would like to thank
Ranking Member Waxman for his decade of leadership and his
service as chairman and ranking member of this committee. He
will leave an indelible legacy of achievement when he retires
at the end of this year, and I am so proud to have learned from
and worked with him on so many issues of great importance to
the American people.
And, Mr. Chairman, I would also like to recognize you for
your eight terms in the House representing the people of
Nebraska. And I have enjoyed working with you during your
chairmanship of the subcommittee over the past 2 years. I wish
you the best of luck in your future endeavors.
I am deeply saddened that we are here again today to
discuss preventable deaths, but I am determined to understand
exactly what happened and to respond in a way that improves
driver and passenger safety. In 2004, a driver in Alabama was
killed by shrapnel ejected by a Takata airbag. Four years
later, the company issued the first recall to address airbag
ruptures, a recall that expanded over the next 5 years. Earlier
this year a new regional recall was initiated to find the root
cause of similar ruptures, and last week, NHTSA asked Takata to
order a national recall, and yesterday the company rejected
NHTSA's request.
Media reports suggest that Takata and Honda knew about the
serious risks its airbags posed to drivers and passengers as
early as 10 years ago. If prompt action had been taken to
investigate the airbag ruptures and truly address the cause, we
wouldn't be here today. Because Takata refused NHTSA's request
for a recall, auto manufacturers, whose customers are driving
vehicles equipped with airbags that could be deadly, now have
to determine whether they would recall the airbags on their own
while the mandatory recall process moves forward.
I have received letters from constituents who are literally
afraid to drive their cars, and this is unacceptable. I want to
know why Takata has been so slow and ineffective to respond, in
responding to this deadly defect and why it believes a national
recall is not warranted. I want to know what commitments Takata
and the auto companies represented here today plan to make in
the immediate future to protect their customers.
I want to know what more NHTSA needs to do in order to
prevent problems like this from continuing to repeat themselves
in the future. And I want to know, since the cause of the
airbag ruptures is still not certain, whether replacement of
these potentially dangerous airbags with very similar products
actually eliminates the risk of airbag explosions in the
future.
So I look forward to our witness' answers to these
questions and more. The incredibly slow response to this
problem is just the latest reminder that we need stronger laws
to protect drivers and passengers and to hold manufacturers
accountable for the cars they sell.
Earlier this year, I introduced H.R. 5654, the Vehicle
Safety Information Act, legislation to improve auto safety and
the efficacy and efficiency of recalls. That bill would expand
and clarify the information manufacturers must provide NHTSA
about defects and fatal incidents, increase information about
auto defects that NHTSA must share with the public, increase
financial penalties and remove the statutory maximum penalty
for manufacturers that violate NHTSA reporting requirements,
provide an imminent hazard authority so that NHTSA can expedite
recalls of potentially deadly cars, limit the resale of cars
with this serious defect, unless the problem has been fixed or
the buyer has been notified and end regional recalls. I urge
the chairman to bring this bill up for consideration in this
subcommittee or to ask House leadership to put it on the
suspension calendar without delay.
And with that, I yield back the balance of my time.
Mr. Terry. Chair now recognizes full committee chair, Mr.
Upton.
OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MICHIGAN
Mr. Upton. Well, thank you, Mr. Chairman, and I appreciate
your leadership the last number of years and we also will miss
Mr. Waxman, and I think we will have, at some point, a formal
recognition of both of your service.
So I am from the auto state. I am sorry to say that it has
been a bad year for auto safety. The latest danger for drivers
malfunctioning airbags that, in fact, can shoot shrapnel
through the air and make a bad accident even worse. Drivers are
being told that their vehicle is being subject to a recall, but
there are not enough parts to fix it, and if they do get a
replacement that airbag maybe subject to the same safety
failure in the future because we still don't know if the root
problem has been addressed.
There are still lots of questions surrounding these airbag
defects and recalls, and today we all want some answers.
American people deserve to have confidence that the cars that
they drive are safe and that the industry and the government
are doing everything that they can do to improve safety. The
first question that has to be determined is whether or not it
is a design flaw for the airbag or is it a manufacturing issue?
Until that question is answered, you are not going to be able
to resolve the issue.
Unfortunately, deadly auto defects and massive recalls are
not new subjects for this committee. I have listened to and led
multiple recall hearings ranging from the Ford Firestone crisis
to the Toyota floor mat problem, obviously to the GM ignition
switch debacle earlier this year. And over a decade ago, I
authored the bipartisan TREAD Act so that we could help catch
and then fix defects sooner and avoid the kind of disaster that
we are facing today. Yet, here we are again.
TREAD Act was very simple: Requiring manufacturers to
report the information needed to help NHTSA quickly identify
vehicle defects and remove flawed cars from the road right
away. Our goal was to prevent injuries and save lives, but we
need industry and NHTSA to do their part. Cars are safer today
but not because a company hires lawyers and consultants to
avoid reporting safety incidents.
I am going to ask some tough questions regarding what we
have read and heard about Honda manipulating the system to
report as little as possible. Companies need to know that there
isn't anything safe about shorting safety. We need more
automakers to make safety a priority and institute safety
incentives. In the case of GM, they acknowledged their safety
failure, their CEO volunteered to testify, and they hired a new
safety officer to implement company-wide culture changes. I
would like to see that same level of urgency, that same
admission of mistakes, and that same commitment to do better
today.
Complex safety technology can lead to complex problems, and
the Takata airbag issues are indeed complex. There were
manufacturing issues and there were handling issues. And as
soon as one problem was identified, it seemed like another
sprang up, sort of like Whac-a-Mole. And now we are waiting to
find out if humidity is the issue or if there are other
manufacturing concerns.
In the meantime, testing is slow, and we are short on
replacement parts. What is worse, no one can say for sure that
the replacement parts are any safer than the originals. We may
be right back here after the replacement parts have reached
their humidity half-life. But complexity is not an excuse for
incompetence. We need to make sure that companies and
regulators can keep pace with innovation. We need a regulatory
agency that breeds confidence and offers solutions, not one
that is often part of the problem.
For our witnesses, I pose this question: What should I say
to the mom in Michigan who asked me if she and her family are
safe behind the wheel? Families across the country expect
safety devices in their vehicles to work. They expect them to
provide life-saving protection that they can count on in the
event of an accident, and they expect that problems from
earlier models be reported and fixed, and they expect to be
able to get their defect repaired when they find out about it;
but sadly, I don't think I can give that assurance right now.
One thing is for sure, we have got a lot of issues to resolve.
I want to again thank Chairman Terry for calling this
hearing to start the process. I want to thank him from the
bottom of my heart for his service as a leader of this
subcommittee and wish him well in the future, and yield back my
time.
[The prepared statement of Mr. Upton follows:]
Prepared statement of Hon. Fred Upton
I'm from the auto state and, I'm sorry to say it's been a
bad year for auto safety. The latest danger for drivers?
Malfunctioning air bags that can shoot shrapnel through the air
and make a bad accident worse. Drivers are being told their
vehicle is subject to a recall but there are not enough parts
to fix it, and if they do get a replacement, that airbag may be
subject to the same safety failure in the future because we
still don't know if the root problem has been addressed. There
are still a lot of questions surrounding these airbag defects
and recalls, and today I want some answers. The American people
deserve to have confidence that the cars they drive are safe
and that industry and the government are doing everything they
can to improve safety. I don't understand after all these years
whether it is a design flaw or a manufacturing issue. You can't
fix the problem until that basic question is answered.
Unfortunately, deadly auto defects and massive recalls are
not new subjects for this committee. I've listened to and led
multiple recall hearings, ranging from the Ford/Firestone
crisis, to the Toyota floor mats problem, to the GM ignition
switch debacle earlier this year. Over a decade ago, I authored
the bipartisan TREAD Act so we could help catch and fix defects
sooner and avoid the kind of disaster we are facing today. Yet,
here we are.
The TREAD Act is simple--require manufacturers to report
the information needed to help NHTSA quickly identify vehicle
defects and remove flawed cars from the road immediately. Our
goal was to prevent injuries and save lives, but we need
industry and NHTSA to do their part.
Cars are safer today, but not because a company hires
lawyers and consultants to avoid reporting safety incidents. I
am going to ask some tough questions today about what we have
read and heard about Honda manipulating the system to report as
little as possible. Companies need to know that there isn't
anything safe about shorting safety. We need more automakers to
make safety a priority and institute safety incentives. In the
case of GM, they acknowledged their safety failure, their CEO
volunteered to testify, and they hired a new safety officer to
implement company-wide culture changes. I'd like to see that
same level of urgency, that same admission of mistakes, and
that same commitment to do better today.
Complex safety technology can lead to complex problems, and
the Takata airbag issues are complex. There were manufacturing
issues and there were handling issues. As soon as one problem
was identified another one sprang up. Now we are waiting to
find out if humidity is the issue or if there are other
manufacturing concerns. In the meantime, testing is slow and we
are short on the replacement parts. What is worse, no one can
say for sure that the replacement parts are any safer than the
originals. We may be right back here after the replacements
have reached their humidity half-life.
But complexity is not an excuse for incompetence. We need
to make sure that companies and regulators can keep pace with
innovation. And we need a regulatory agency that breeds
confidence and offers solutions, not one that is too often part
of the problem.
To our witnesses, I pose this question: What should I say
to the mom in Michigan who asks me if she and her family are
safe behind the wheel? Families all across the country expect
the safety devices in their vehicles to work; they expect them
to provide lifesaving protection they can count on in the event
of an accident. They expect problems from earlier models to be
reported and fixed, and they expect to be able to get a defect
repaired when they find out about it. But sadly, I can't give
those assurances right now. One thing is for sure--we have a
lot of issues to resolve. I thank Chairman Terry for calling
this hearing to start the process, and I want to thank him for
his service as a leader of this Subcommittee and wish him well
in his next endeavor.
Mr. Terry. Thank you, Mr. Chairman. That is much
appreciated.
Now it is time to introduce our panel and----
Mr. Waxman. Mr. Chairman.
Mr. Terry. Oh, I am sorry. Getting ahead of myself.
Gentleman from California is recognized for 5 minutes.
OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Waxman. Thank you very much, Mr. Chairman. Neither you
nor I have left the committee yet, which we will do at the end
of this year. And I thank our colleague, Ms. Schakowsky, for
her kind words.
Here is what we know so far about the Takata airbag
recalls. We know that there has been a series of airbag recalls
affecting millions of vehicles dating back to 2008, and we know
that at least five people are dead and dozens have been injured
by these defective airbags. There are questions about the
Takata airbags that remain unanswered. We do not know exactly
what Takata and auto manufacturers knew about these defective
airbags and when they knew it.
We do not know, and it appears that the National Highway
Traffic Safety Administration, Takata, and the auto
manufacturers do not know either the root cause of all these
exploding airbags. So we have questions about whether the
replacement airbag inflators are safe.
New documents provided to the committee reveal new
questions. The National Highway Traffic Safety Administration,
known as NHTSA, recently requested a national recall of all
defective airbags on the driver's side of the car, but has
limited its action to regional recalls of passenger side
airbags. But data we have received is raising new questions
about the safety of passenger side airbags and the scope of
recalls.
Takata has tested over 2,500 driver and passenger side
airbags for ruptures. None of the driver's side airbags
ruptured in these tests. But Takata has observed over 60
passenger side airbag ruptures. Given these testing results, we
need to understand why NHTSA has requested a broader recall for
driver's side airbags but has not made the same request for
passenger side airbags.
Mr. Chairman, I have some documents that I have referred to
showing these test results, and I would ask unanimous consent
to put them in the hearing record.
Mr. Terry. Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Mr. Waxman. We need to find answers to these questions, and
I hope the committee will continue its investigation even after
the time you and I, Mr. Chairman, will be gone. But we know
enough now to begin our legislative work.
Mr. Chairman, last April, I joined Representative
Schakowsky to introduce H.R. 4364, the Motor Vehicle Safety Act
of 2014. There are many important provisions in this
legislation that would address problems that the committee
found in our investigations of Takata's exploding airbags and
the GM ignition switch failure. In both cases, auto
manufacturers and auto parts manufacturers failed to provide
key information to the Federal agency, NHTSA, in a timely
fashion.
And we learned last week of another major auto safety
failure. For over a decade, Honda failed to report to the NHTSA
more than 1,700 claims of injuries or deaths caused by
accidents in its vehicles. Our legislation improves the early
warning reporting system by making more reported information
public and ensuring that NHTSA receives significantly more
information for manufacturers on any fatal incident involving a
safety defect.
Additional data and greater transparency will help NHTSA
identify deadly safety defects sooner. In both the GM and
Takata cases, NHTSA has been criticized for failing to
recognize and act quickly enough as evidence mounted of deadly
auto defects. Our bill provides more resources to give them the
additional enforcement authority and increases the fines for
manufacturers that violate vehicle safety laws.
Mr. Chairman, today we will learn of other needed fixes to
the current system. I think our legislation is a good place to
start. While I have very short time left, I would like to yield
to the gentleman from Vermont the balance of my time.
Mr. Yarmuth. Thank you very much.
The two concerns that I have that I hoped are addressed in
this is, one, public safety. Obviously, automobiles are
extremely important but can be dangerous with the defect; and
number two, public confidence. When a serious incident happens
that threatens a life, costs us a life, it raises immense
public insecurity around the driving public. And obviously, in
my view, the burden has to be on the manufacturer and our
governmental agencies to take the appropriate steps to revive
and restore public confidence.
Thank you.
Mr. Terry. Thank you.
Now it is the appropriate time to introduce the panel. I
will introduce the panel as a whole and then we will start with
Takata as the first speaking witness. So today our first panel
representing Takata is Hiroshi Shimizu; from Honda; Rick
Schostek, from BMW, Craig Westbrook; from Toyota, Abbas Saadat.
I appreciate all of you being here. We will go from my left,
your right and start with Mr. Shimizu.
But before I ask you to start, I want to recognize that you
are appearing with a translator because English is not Mr.
Shimizu's first language. And while the committee will allow
Mr. Shimizu to confer with the translator for the purpose of
clarification, you will be required to answer the committee's
questions in his own voice and in English. We have already
discussed that, and I appreciate your acceptance of that.
So Mr. Shimizu, you are now recognized for 5 minutes.
STATEMENTS OF HIROSHI SHIMIZU, SENIOR VICE PRESIDENT FOR GLOBAL
QUALITY ASSURANCE, TAKATA CORPORATION; RICK SCHOSTEK, EXECUTIVE
VICE PRESIDENT, HONDA NORTH AMERICA; CRAIG WESTBROOK, VICE
PRESIDENT, AFTERSALES, BMW OF NORTH AMERICA; AND ABBAS SAADAT,
NORTH AMERICAN REGIONAL PRODUCT SAFETY EXECUTIVE, VICE
PRESIDENT, VEHICLE SAFETY AND COMPLIANCE LIAISON OFFICE, TOYOTA
STATEMENT OF HIROSHI SHIMIZU
Mr. Shimizu. Thank you. Chairman Terry and Ranking Member
Schakowsky, and distinguished members of the subcommittee, I am
honored to be here on behalf of Takata Corporation.
Mr. Chairman, Takata is dedicated to making products that
save lives. Millions of Takata airbags have inflated properly
preventing thousands of deaths and avoiding serious injuries in
hundreds of thousands of accidents around the world. But any
fear of even one airbag to perform as designed in an automobile
accident is incompatible with Takata's mission. All of us at
Takata know that the airbag inflator ruptures that has been the
subject of recent recalls involve serious issues of public
safety. We are deeply sorry about each case where Takata airbag
has not performed as designed and the driver or passenger has
suffered personal injuries or death.
Takata is working closely with the automakers and NHTSA to
support the ongoing recalls and field actions and to address
the potential for inflator rupturing. We are increasing our
production quality replacement kits to fulfill the automakers'
orders. We are also devoting extensive efforts and attention to
answering requests for information about these models from
NHTSA and other investigators. We are committed to being fully
transparent with the government.
One important function of the regional field action is to
retrieve inflators for testing and analysis. In the past
several months, we have tested thousands of returned inflators
in our Michigan facilities, and we are increasing our testing
capacity. We regularly share all of these test results with the
automakers and the NHTSA. Based on the data currently available
and our best engineering judgment, Takata continues to believe
that the public safety is best served if the area of high
absolute humidity remains a priority for the replacement of
suspect inflators.
But make no mistake, we will take all actions necessary to
advance the goal of safety for the driving public, including
working to produce additional replacement units to support any
further recalls that may be announced by automakers. Takata is
also prepared to collaborate where feasible with other inflator
producers to create additional production capacity for
replacement units over the long term.
We are confident that the inflators we are producing today
are safe because we have confidence in the integrity of our
engineering and our current manufacturing processes here in the
United States and across the world. We believe that property
manufactured and installed, the inflators we are producing
today would work as designed to save lives for the expected
life of the automobiles.
To provided added quality assurance for the public and the
automakers, Takata is forming an independent quality assurance
panel to audit and prepare an independent report regarding our
current manufacturing processes for the production of safe
inflators, including inflator propellent. Upon completion, the
panel's report will be made public.
Thank you, Mr. Chairman.
Mr. Terry. Thank you.
[The prepared statement of Mr. Shimizu follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Terry. Now, the gentleman from Honda, Mr. Rick
Schostek, you are recognized for your 5 minutes.
STATEMENT OF RICK SCHOSTEK
Mr. Schostek. Mr. Chairman, Ranking Member Schakowsky and
members of the subcommittee, thank you for this opportunity to
testify. My name is Rick Schostek. I am executive vice
president with Honda North America.
I want to begin by expressing our deepest sympathies to
those individuals and families who have been affected by these
tragic incidents. We offer our sincere apologies to the
families of those who have died, who have been injured, or who
have been, in any way, inconvenienced due to the defects in the
Takata airbags in our vehicles. Airbags save thousands of lives
each year, but we recognize that even one customer who is
injured or loses their life when an airbag does not perform as
intended is one too many, and it is completely unacceptable.
On November 17, NHTSA called for a nationwide recall of the
driver airbag inflators that have been included in the regional
safety improvement campaign undertaken in four states and
territories with consistently high absolute humidity. We
understand that Takata has not identified or acknowledged any
defect of the driver airbag inflators, and thus far, Takata has
not announced plans to follow NHTSA's request for a national
recall. We want to inform you that Honda is going to expand our
existing regional safety improvement campaign on affected
driver airbag inflators to a national campaign. Why are we
doing this? Because our customers have concerns and we want to
address them.
We believe this expansion and acceleration of current
action, we believe there will be a part shortage that may
occur, despite Takata's efforts to increase the supply of
inflators. To further increase the parts supply, we have been
in discussions with Takata and two other suppliers, Autoliv and
Daicel, about expanding the production of replacement
inflators. These talks have been encouraging, and we believe
will ultimately reduce the duration of any shortage; however,
until those parts are available, we will continue to discuss
with NHTSA and Takata how to best manage the supply issue.
Based on the information from them, we believe it is best
to prioritize the replacement of driver airbag inflators in
what are considered to be the highest risk areas in the
country. In addition, Honda believes that all stakeholders
would benefit from expert third-party testing of Takata airbag
inflators that was announced yesterday as an industry-wide
program. By coming together as an industry and sharing
information and testing, and with Takata's continued
cooperation, we believe we can achieve greater results more
quickly.
Let me briefly summarize how we got to this point. Between
2008 to 2014, Honda has conducted seven national recalls
related to specific Takata manufacturing defects. Since June of
2014, Honda, along with other automakers, has been supporting
NHTSA's request to conduct regional safety improvement
campaigns in States and territories with high absolute
humidity.
We understand the urgency of the current situation, and we
have been taking proactive steps to address the needs of our
customers. In addition to the required first-class mail
notification, we have made hundreds of thousands of phone
calls, used overnight mail delivery, and routinely sent letters
in both English and Spanish. We have also hired a search firm
to help us locate hard-to-find customers in some circumstances.
And importantly, for customers whose vehicles cannot be
immediately repaired, Honda has instructed our dealers to
provide loaner or rental cars at no cost to the customer.
To summarize, we are going to expand the safety improvement
campaign on affected driver bag inflators nationwide,
prioritizing the high-risk areas. We are working with multiple
suppliers to increase parts availability and we are
participating in the joint industry research effort. Our entire
company is operating with the greatest energy and focus to
quickly address our customers' needs and concerns. In the days
ahead, with every action of our company, we are dedicating
ourselves to honor the relationship we have with our customers.
Thank you.
Mr. Terry. Thank you.
[The prepared statement of Mr. Schostek follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Terry. And now Mr. Westbrook, you are now recognized
for 5 minutes.
STATEMENT OF CRAIG WESTBROOK
Mr. Westbrook. Thank you, Chairman Terry, Ranking Member
Schakowsky, and members of the subcommittee for your invitation
to participate in today's hearing. My name is Craig Westbrook,
vice president of BMW of North America. I am here on behalf of
our company representing the 70,000 people who have jobs
provided and supported by the BMW group in the United States.
In total, the BMW Group's presence is represented in 48
States, this includes our North American headquarters in New
Jersey, our financial services in Ohio, and our manufacturing
facility in Spartanburg, South Carolina, just to name a few
locations. In fact, BMW Group's South Carolina production site
is the largest single exporter of vehicles by value in the
United States of America.
The BMW Group has been in the United States for nearly four
decades. We have worked hard to become part of the fabric of
the communities in which we are present. Central to our
investments and commitment to the United States has been a
focus on earning our reputation for delivering on our word, and
building trust with customers and communities alike. Vehicle
safety is fundamental to the BMW Group. Because of this, I
highly appreciate the opportunity to appear today before this
subcommittee.
I will share a brief timeline of BMW North America's
activities related to Takata airbag recalls. In May of 2013,
after Takata informed BMW North America of production issues
with certain inflators, we initiated a voluntary national
safety recall. This involved the passenger front airbag on
approximately 42,000 model year 2000 to 2003 BMW vehicles. In
May of 2014, NHTSA met with Takata to discuss consumer-reported
issues with certain passenger and driver airbag inflators.
In mid-June, after follow-up calls with Takata, NHTSA
opened a preliminary evaluation. In an unprecedented approach
to determine the root cause and the potential safety risk NHTSA
held a conference call with all affected automakers. During
this call, automakers were asked for their support to conduct a
voluntary parts collection campaign in specific high-humidity
regions. BMW North America promptly agreed to participate in
this campaign.
In July of 2014, out of an abundance of caution, BMW North
America expanded its voluntary campaign and previous 2013
recall of passenger front airbags. On July 15, 2014, BMW North
America notified NHTSA of the voluntary nationwide recall of an
additional 574,000 vehicles. The next day, July 16, 2014, BMW
dealers were notified of the recall after notification to
NHTSA.
Standard practice for notifying customers involves an auto
company preparing a draft customer notification letter for
NHTSA's review. In late August, NHTSA approved our letter. BMW
of North America mailed its notification letters to our
customers in mid-September using first-class mail as required
by NHTSA regulation.
Another way customers are informed of recalls is at our
dealerships. When a customer visits a dealership, the service
advisor at every BMW dealer conducts a vehicle inquiry for
outstanding recalls. Once the VIN is identified, the service
advisor cross-references the VIN against our recall database.
If applicable, customers are informed that their vehicle is
subject to a recall. Repairs are either taken care of on the
spot or an appointment is scheduled as soon as possible.
We have also made the recall information available on our
consumer site, BMWUSA.Com. Additionally, the information is
also available on the NHTSA site, www.SaferCar.gov. On either
side, customers have the ability to access recall information
just by entering their VIN. We even issued a press release
regarding the Takata's airbag recall for BMW. In total, this
voluntary nationwide recall affects approximately 616,000 model
year 2000 to 2006 3 Series vehicles. NHTSA estimates over 7.8
million vehicles industry-wide are currently affected bring the
Takata airbag recall and parts collection campaign in the
United States.
BMW of North America is also currently conducting a
voluntary regional parts collection campaign in certain states.
This campaign affects the driver's front airbag on
approximately 11,600 model year 2004 to model year 2006 BMW 3
Series vehicles.
We are significantly increasing our loaner fleet to provide
any BMW customer who needs a loaner, rental vehicle, or
alternative transportation of the customer's wish. I can assure
the subcommittee that BMW of North America will continue
working with NHTSA and Takata on a these issues. We will remain
vigilant in identifying safety issues and proactive in
addressing them.
Thank you for your time and attention.
Mr. Terry. Thank you, Mr. Westbrook.
[The prepared statement of Mr. Westbrook follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Terry. Now, Mr. Saadat, you are recognized for your 5
minutes.
STATEMENT OF ABBAS SAADAT
Mr. Saadat. Chairman Terry, Ranking Member Schakowsky, and
member of the committee, thank you for inviting me here today.
My name is Abbas Saadat, and I am the regional product safety
executive and the vice president at Toyota North America. I am
a senior executive in the United States responsible for
Toyota's interaction with NHTSA and currently have oversight
responsibility for field action in the U.S. regarding the
Takata airbag inflator recalls. I am an engineer by training
and function.
First, Toyota shares your goals of helping those affected
by these recalls and keeping them safe. We are committed to
resolve this issue for our customers as quickly, conveniently,
and safely as possible. We believe the actions we have taken
reflect this commitment. From the beginning, Toyota has
responded to defect information from Takata, coordinated with
NHTSA, and supported Takata and NHTSA in their ongoing
investigation.
In April of 2013, Toyota launched a nationwide recall for
front passenger airbag inflators. This recall is still in
effect today. In June of this year, we expanded the remedy for
this recall to replace all affected Takata inflators. Also in
June, in response to NHTSA's request to the industry, we were
among the first automakers to recover airbag inflators for
testing by Takata. In October, Takata provided testing data to
Toyota and NHTSA that suggested the safety risk was highest in
the area of consistently high absolute humidity. In response,
we intensified our effort to reach customers in those humid
areas, which was publicized nationwide.
Throughout these recalls we have worked to alert customers
and get them the information they need. Beyond our initial
national outreach, we have mailed more than 300,000
notification letters to known owners in the designated humid
region. We also have made it easier for customers to find
recall information on Toyota's Web site. In addition, we have
started a secondary customer outreach program in humid areas
that include telephone calls, email, and direct mail, and we
are staffing our call centers to handle any increase in Takata-
related inquiries.
At the same time, we are working to get replacement parts
to Toyota dealers, and this effort is going well in humid
regions. If parts are unavailable, we have empowered dealers to
meet our customers' needs and minimize their inconvenience. For
example, in humid areas, dealers can disable the front
passenger airbag and affix a prominent glove box label that
warns against using that seat until a replacement inflator is
installed. Dealers are also making loaner vehicles available
and towing affected vehicles for customers, if necessary.
To this point, the faster we get replacement parts, the
faster we can fix our customers' vehicles. Takata estimates
that its supply will increase significantly starting this
month. Like you, we want additional assurances about integrity
and quality of Takata's manufacturing processes, particularly
in the light of previous experiences. For instance, in 2010,
Toyota had to recall certain Takata inflator in Japan to
address a different manufacturing problem not involving U.S.
vehicles.
In terms of testing, we have conducted and continued to
conduct some testing on Takata inflators, and we have also
inspected Takata production facilities. Additionally, we have
retained an independent engineering firm to evaluate affected
Takata inflators and replacement parts. Separately, Toyota is
inviting all affected automakers to participate in a joint
industry-wide initiative to conduct independent testing of
Takata airbag inflators.
Toyota will further address the issue of testing in our
response to NHTSA's recent general order and ongoing
communications with the agency. Again, our nationwide recall
remains in effect, and we plan to replace all involved
inflators as parts become available. In closing, Toyota is
taking this issue very seriously. We will continue to respond
promptly to new development and do what is best for our
customers.
Thank you, and I am happy to answer your questions.
Mr. Terry. Thank you, Mr. Saadat.
[The prepared statement of Mr. Saadat follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Terry. At this time, we are now to the question-and-
answer period, and I have the opportunity to ask the first
questions.
Mr. Shimizu, following NHTSA's June, I think it was 19,
2014, request to Takata and 10 vehicle manufacturers to
participate in a regional field action, how many passenger side
and driver's side airbag inflators have been tested to this
date? So June 14 to today.
Mr. Shimizu. To my knowledge, up to today, we complete the
test around 4,000 pieces.
Mr. Terry. Now, the 4,000 tests, are they evenly divided
between passenger and driver's side?
Mr. Shimizu. Most of the product is the passenger side. And
I think for driver's side, quantity is about, I believe, around
400.
Mr. Terry. 400?
Mr. Shimizu. Yes, 400.
Mr. Terry. So 3,600 of the tests were on the passenger
side?
Mr. Shimizu. Yes.
Mr. Terry. So out of the 3,600 on the passenger side
airbags, how many ruptures have occurred?
Mr. Shimizu. I don't have an accurate number, but I believe
around, a little bit less than 60.
Mr. Terry. Less than 60, OK. How about on the driver's side
of the 400 that were tested?
Mr. Shimizu. Zero at this moment.
Mr. Terry. Zero. How many tests are you doing currently,
per day?
Mr. Shimizu. Currently, we are testing about 100 inflators
per day.
Mr. Terry. One hundred what per day?
Mr. Shimizu. One hundred pieces per day.
Mr. Terry. Pieces. Are those all passenger, or again, is it
both?
Mr. Shimizu. It is sometimes only passenger side, sometimes
only driver's side, or mix. It depends on what kind of inflator
we collected from the region.
Mr. Terry. Very good. Then with your continued stance on
opposing a national recall, what about Takata's test results
leads you to believe that a national recall of all driver's
side airbags is not needed or appropriate?
Mr. Shimizu. Based on the data we are collecting from the
inflator from the region and also other regions, the data still
support that we should remain focused on the region with high
temperature and high humidity.
Mr. Terry. OK. Now, the crashes in California and North
Carolina led NHTSA to believe that the Takata airbag inflators
pose a risk outside of the States with high absolute humidity.
So why do you disagree with NHTSA's conclusion here?
Mr. Shimizu. First, let me just state what I mentioned in
opening statement. We are not opposing NHTSA's direction. We
will commit to take any action necessary to advance the goal of
safety for the driving public, that also includes working to
produce the additional replacement kits to support the further
recall that was announced by automakers. So once automakers
decided to expand or change their range of recalls, we support
it.
And regarding your question about California event and
North Carolina event, the California event, the vehicles are
covered by current regional recall, but also I want to explain
that we do some investigation about that event but it is not
completed yet and still under investigation. And regarding the
event in North Carolina, at this time, we have no chance to
check the vehicles and action materials. We only have the
production, the serial number information, and the pictures. So
we will inspect the actual vehicles later together with NHTSA
and automakers and Takata.
Mr. Terry. Very good. Well, I only have 28 seconds left, so
I will yield back my time and recognize the ranking member from
Illinois for 5 minutes.
Ms. Schakowsky. Thank you, Mr. Chairman.
Mr. Shimizu, am I saying it correctly?
Mr. Shimizu. Yes.
Ms. Schakowsky. In the letter Takata sent to NHTSA
yesterday, the company rejected a national recall. Your
director of product safety wrote that ``Under the NHTSA
statute, only manufacturers of motor vehicles and replacement
equipment are required to decide in good faith whether their
products contained a safety-related defect, and if so, to
conduct a recall.''
And Mr. Chairman, I would like to submit this letter for
the record.
Mr. Terry. Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Ms. Schakowsky. Mr. Shimizu, let me ask you, do you agree
with the conclusions in the letter sent by your company
yesterday?
Mr. Shimizu. Yes, Congresswoman.
Ms. Schakowsky. So Mr. Shimizu, do you agree that Takata is
not required to decide in good faith whether your products
contain a safety-related defect?
Mr. Shimizu. Congresswoman, I agree with that statement. It
is the best data we have, that doesn't support the change from
regional recall to national recall at this moment.
Ms. Schakowsky. So are you telling us that your company has
no legal responsibility to determine if airbags are defective
and to recall them?
Mr. Shimizu. If our products are defective and supported by
scientific data, we are responsible for that.
Ms. Schakowsky. So you believe that you are responsible for
that if they are found to be defective, but it is really up to
you to decide that?
Mr. Shimizu. Yes. We need extensive research of the
products involved in the incident or whatever. So once we
determine that it is defective, yes, it is our responsibility.
Ms. Schakowsky. So moving forward, Takata will be producing
millions of replacement airbags. Are the replacement airbags
that you are having installed as a result of the recall safe?
Mr. Shimizu. Yes. It is true that we have issued in the
past, and we identified the root of cause and addressed all
issues we had in the past and took care of this. And currently,
products including replacement kits we are producing from well-
controlled manufacturing processes and should perform a design
and I consider is safe.
Ms. Schakowsky. So you believe that you have, in fact,
discovered the root cause of the ruptures?
Mr. Shimizu. Excuse me?
Ms. Schakowsky. Are you sure and certain that you have
discovered, Takata has discovered the root cause of the airbag
ruptures?
Mr. Shimizu. Yes, we identified the root cause of the
issues of the products we did a recall in the past. However, we
still continue the investigation for the incident that happened
in an area with high humidity and high temperature. So we need
to continue to investigate these inflators collected from these
regions.
Ms. Schakowsky. So are you saying that it is only in high
humidity areas that this is a problem, that that is the root
cause?
Mr. Shimizu. We considered it a main contribution to the
problem is the high temperature and absolute humidity, together
with age of the products and probably maybe a combination with
manufacturing issues. That is why we collect inflators from
these regions with support from all the vehicles at NHTSA and
then continue to analyze these inflators.
Ms. Schakowsky. Interesting.
So who is the highest ranking Takata official that has
actually signed off on production of the airbags that are now
being recalled? The ones that are being recalled, who is the
highest ranking official that has actually signed off on that?
Mr. Shimizu. Any court-related issue and statement from a
company, I usually sign.
Ms. Schakowsky. You sign it, OK.
And who is the highest ranking Takata official with
oversight over the production approval process?
Mr. Shimizu. Production approval is usually signed by head
of operation, and also production, which means I sign.
Ms. Schakowsky. And let me just ask each of the
manufacturers--oh, and one more question for you, Mr. Shimizu:
Have any of these individuals, including yourself, been held
accountable for these decisions?
Mr. Shimizu. Excuse me, can I ask my interpreter?
Ms. Schakowsky. Yes.
[Confers with interpreter.]
Ms. Schakowsky. Have there been consequences?
Mr. Shimizu. We are more focused on collecting problems and
we are not addressing that area yet.
Ms. Schakowsky. OK. But let me quickly, could I ask just
yes or no, are Toyota, Honda, and BMW cars on the road right
now nationally both for drivers and passengers with Takata
airbag safe? The real question is, would you tell your children
and spouses there is no danger of this type of rupture, so keep
on driving? Mr. Schostek and then----
Mr. Schostek. Congresswoman, we want our customers to be
safe and to feel safe in our cars. As you have heard, there are
national recalls in effect. What we want our customers to do
is, first, understand whether their car is subject to a recall.
They can do that either by checking our Web site, by calling
us, or by visiting their local dealer and finding out if they
are subject to a recall. If they are, we want that car, we want
to replace that part. If they are not subject to a recall, we
believe they are safe in those cars.
Ms. Schakowsky. Mr. Westbrook.
Mr. Westbrook. Yes.
Ms. Schakowsky. Mr. Saadat.
Mr. Saadat. Please keep in mind, for Toyota vehicles, the
problematic inflators are all on the passenger side, not
driver's side. I just want to make that clear for Toyota
vehicles. But in terms of----
Ms. Schakowsky. How do you know that all the deaths were on
the driver's side? All the deaths, not necessarily in Toyota,
but all the deaths----
Mr. Saadat. No, I understand.
Mr. Terry. Gentlelady's time has expired.
Ms. Schakowsky. Thank you.
Mr. Terry. Chair now recognizes the full committee chair,
Mr. Upton.
Mr. Upton. Thank you, Mr. Chairman.
And I want to go back to my opening statement where this
committee has been very involved in auto safety, rightly so,
for a lot of years. And I can remember rolling a flawed tire
down this very dais about 10 years ago, really seeking action.
And we did it. We worked at the end of the session, we
significantly raised the fines, and we added criminal sanctions
for violations: Jail. It was tough to get through, but we got
it done. And I want to say it was certainly bipartisan, and it
was pretty close to unanimous in terms of what we did.
And what that TREAD Act did was really forcing the
manufacturers to share details with the regulator to make sure
that consumers, us, got the information and felt safe behind
the wheel. Now, there is a report that came out this morning, I
have not read it, just literally within the last half hour or
so. But it says, ``Reuters is reporting today that Takata ran
an investigation into an airbag inflator that ruptured in a BMW
as early as 2003, and is that additional testing for airbag
inflator defects was done in 2004, 10 years ago.'' That was the
time when we were passing the TREAD Act. ``Both of these
revelations would indicate that Takata was investigating this
hazard well before it has been previously disclosed.''
Can you comment, Mr. Shimizu, on the 2003 and 2004
investigations? Are they related to the current recall?
Mr. Shimizu. Congressman, my answer is no.
Mr. Upton. You can use the mic.
Mr. Shimizu. Excuse me, can you hear me now? OK. My answer
is no. Regarding the BMW incident in 2003, to my knowledge, it
happened in Europe, I believe Switzerland, and that the cause
of the problem is not the inflator propellent issue we are
talking about right now. That was manufacturing issues that
caused that problem, so it is not same as the problems we are
discussing right now.
Mr. Upton. So they are not related, is what you are saying?
Mr. Shimizu. Not related to the current issues.
Mr. Upton. So do you know whether the issue today is
manufacturing-related, or is it a design flaw in the inflator
itself? Do you know the answer to that question? Yes or no?
Mr. Shimizu. In my knowledge, the current issue is most
likely manufacturing-related, not design-related.
Mr. Upton. It is not manufacturer related?
Mr. Shimizu. It is manufacturer related.
Mr. Upton. It is manufacturer-related, OK. Thank you.
Mr. Schostek, in 2011, a Honda associate recognized an
issue related to the recording of a verbal date code in a legal
file management system that could have affected the accuracy of
the early warning reports. And additionally, in 2012, NHTSA
made Honda aware that it was underreporting claims. Why didn't
Honda follow up with the issue in 2011, and why didn't Honda
take conclusive action in 2012?
Mr. Schostek. Chairman Upton, thank you very much for that
question. And I understand your involvement in the
establishment of the TREAD Act more than 10 years ago, and I
can understand the disappointment that you feel by the
shortcomings that have been evidenced by our company. And I
want to explain to you what happened. The problem that we had
with underreporting in the TREAD Act is a systematic problem
that began at the outset of the TREAD Act. As you know, it went
into effect in 2003. Our staff at the time did not properly
program computers and set up systems that would accurately let
data flow and feed into TREAD reports.
It is difficult for me to say, sir, but that setup
continued unchecked until 2011, 2012. You are right that an
internal Honda associate did mention a concern as well as a
discussion with NHTSA. They asked about the omission of certain
incidents in our TREAD reporting. We did look into that, sir,
in early 2012. We did not look into it effectively. We found
one of what eventually we came to know would be three problems.
We found one problem and took substantial action to address
that one problem, but, sir, it did not complete our compliance
requirements.
Mr. Upton. Can I just have an additional minute? So what
was----
Mr. Terry. Without objection.
Mr. Upton. And we are going to be asking NHTSA, who is
filing, what was NHTSA's response when--you did correct it with
NHTSA; is that not right? I mean, you did fess up, in essence,
to NHTSA, right?
Mr. Schostek. In 2012, sir, we had a problem about
converting oral claims into written claims. We made what we
call a countermeasure internally to report those written
claims.
Mr. Chairman, we did not close the loop with NHTSA, and we
did not act with the urgency we needed to.
Mr. Upton. Did NHTSA come back and say, what happened? Was
there any dialogue? What was NHTSA's response? I mean, did----
Mr. Schostek. As you know, sir, we engaged a third party to
do an audit in September of this year, and we had a dialogue
with NHTSA in October of this year about the preliminary
findings of that audit. They actually found--I am glad that we
used an outside third party to do that audit because they found
two more instances of our noncompliance.
So, based on that, we had discussed that with NHTSA, our
preliminary findings, in mid-October of this year. As you know,
we just submitted our information to NHTSA on Monday, and we
are waiting for their response.
But I think what we have done in the meantime, sir, is to
begin to fix the computer programs, to provide training, to
augment the staffing, but, most importantly, to establish
accountability within our organization. There are many
functions that feed information for TREAD, and we did not
designate a single responsible person, and that is our failing,
sir.
Mr. Upton. OK.
I yield back.
Mr. Terry. Thank you.
Now the chair recognizes the full committee ranking member,
Mr. Waxman.
Mr. Waxman. Thank you very much, Mr. Chairman.
On November 18, NHTSA announced its intention to expand the
regional recall of driver-side airbags to a nationwide recall.
And on November 26, NHTSA formally requested that Takata expand
to a national recall. But yesterday Takata responded that,
quote, ``the currently available reliable information does not
support a nationwide determination of a safety defect,'' end
quote.
Mr. Shimizu, why does Takata believe that there is not
enough evidence to support a national driver-side airbag
recall?
Mr. Shimizu. Yes, Congressman. As you know, we were
collecting the data from the inflator we collected for the
regional recalls. And according to the data we have, there is
actually zero anomaly from driver side. And then we have some
anomaly found in the passenger side, but all of them come from
Florida and Puerto Rico.
So, based on these datas, we consider that still we should
stay focused on this area. And, at this moment, there is not
enough scientific evidence to change from regional recall to
national recall. That is the background.
Mr. Waxman. Do you recall the same thing is true for the
regional recalls of passenger-side airbags?
Mr. Shimizu. As I said, Congressman, all anomalies found in
the passenger-side inflator came from Florida and Puerto Rico.
Mr. Waxman. OK.
Now, let me see if I can understand this decision a bit
more from the consumer prospective. In the continental United
States, the recall only covers cars in Florida; isn't that
right?
Mr. Shimizu. Are you talking about regional recalls?
Mr. Waxman. Yes.
Mr. Shimizu. Yes. The regional recalls covered Florida,
Puerto Rico and Hawaii and Virgin Islands, and some automakers
covered even more around the Gulf Coast.
Mr. Waxman. But if I have a car with a Takata airbag in
Yulee, Florida, just south of the Georgia line, it is an urgent
matter that I bring it in for a recall. But if I instead live
15 minutes north of that line in Kingsland, Georgia, I gather
the position is that my car is perfectly safe. Is that a
correct assumption?
Mr. Shimizu. Based on the data we collected, temperature
and humidity and also what we call the dew point, and that is
the background about how we can determine the area which we
focus on that. So that is covered quite a wide area. And if it
is a vehicle used or registered outside the area, we consider
it safe and no concern at this moment.
Mr. Waxman. OK.
Mr. Schostek, does that make sense to you? Fifteen minutes
north, you are OK, but if you are in Florida just below the
line, you have to go in and get a replacement?
Mr. Schostek. Right, Congressman Waxman. I think it is also
important, as we talk about this, to distinguish the recalls
regarding the manufacturing defects from this more recent
regional recalls. I just want to make sure that the committee
understands that the recalls that we conducted from 2008
through 2014 that were related to specific Takata manufacturing
defects, those were national in scope. So, for those recalls,
we believe we understand the cause of the problem--that is,
Takata's manufacturing defects. And those cars are being
recalled no matter where they are.
What we are talking about now is from 2014 to the present,
so approximately the last 5 months. And all of us in the
industry have been asked by NHTSA to do a safety improvement
campaign to gather information and recall or bring back the
inflators that are in those high-humidity States. I know when
we looked at that, we included contiguous counties, and we
expanded beyond what NHTSA asked us to do, but----
Mr. Waxman. But the idea is that if you are in certain
areas the heat and humidity would require you to comply with a
regional recall, but--let me just ask a different question.
If I live in, say, Houston, Texas, it is slightly less
humid there, but not by much, than Jacksonville, Florida. Can
we be certain that my car won't develop the same defect but
perhaps 2 or 3 years later?
Mr. Schostek. That is a good question, Congressman, and we
asked that question ourselves. And that is why we expanded our
regional recall to include Texas.
Mr. Waxman. Yes.
And, Mr. Shimizu, do you still not know the root cause of
these airbag failures?
Mr. Shimizu. Congressman, if the question is asking about
regional recalls, these are----
Mr. Waxman. But I am just asking, do you know the root
cause of this problem?
Mr. Shimizu. At this moment, we don't have the root cause.
We know the factors may contribute to this problems, so that is
why we are still researching these inflators collected from
regions.
Mr. Waxman. Well, the confusing, contrary, uncertain, and
sometimes purely nonsensical information that comes from Takata
is confusing to drivers. They don't know whether their cars are
safe.
This confusion is exacerbated by the different ways that
auto manufacturers are handling the situation. For example,
until this morning, Honda had chosen to expand its regional
action to 13 high-humidity states and territories. This
morning, we learned that Honda will be expanding to a national
recall of driver-side airbags.
Mr. Schostek, when and why did Honda decide to expand its
recall to the 13 States and territories?
Mr. Schostek. Congressman Waxman, we have heard this
morning about NHTSA's request to Takata and the answer that
Takata gave yesterday. We have been seriously considering, as
Honda, expanding the safety improvement campaign nationally so
we can gather more data nationally. Once we understood that
answer yesterday from Takata, we decided to take action. We
want to take care of all of our customers on a nationwide
basis.
However, sir, as I said in my opening statement, we still
believe that the highest risk is in the southern areas, those
high-humid areas, and that those should be prioritized with
respect to replacement parts.
But we believe that our customers have concerns, and our
job is to satisfy our customers. So we want to expand the
recall--the safety improvement campaign to include all areas of
the country, again, keeping a priority on those regional areas.
Mr. Waxman. OK. Thank you very much.
Thanks, Mr. Chairman.
Mr. Terry. The gentleman's time has expired.
The chair recognizes the gentlelady from Tennessee, the
vice chair of the full committee.
Mrs. Blackburn. Thank you, Mr. Chairman. And I thank you
for your good work on this.
And I thank our witnesses for being willing to answer these
questions, because we are trying to get to the root cause of
this--Mr. Waxman just mentioned that term.
And, Mr. Shimizu, I want to go that direction with you.
Let's go specifically to the November 19th New York Times
article that tries to give a framework, a timeline, a
chronology to this.
We can solve this problem, and, by and large, we have
talked about what we are doing about this, what you all are
doing about it. But let's go back to how we got into this mess
in the first place and why we got into this mess in the first
place. And that is covered in some part in this New York Times
article.
And, Mr. Chairman, I would like to submit this for the
record. I think it speaks to both Mr. Waxman's question and to
mine.
Mr. Terry. You said ``this.'' Would you please----
Mrs. Blackburn. New York Times article.
Mr. Terry. Without objection, so ordered.
Mrs. Blackburn. OK. Thank you, Mr. Chairman.
[The information appears at the conclusion of the hearing.]
Mrs. Blackburn. Mr. Shimizu, I want to read to you from the
article. It says, ``By 1999, Takata researchers in Michigan,
pressured by executives, developed a propellant based on
ammonium nitrate,'' he said, ``but the engineering team in the
Moses Lake plant raised objections to basing a propellant on
such a risky compound.''
Now, let's talk about that for a minute, because I also
found Michael Britton, a Takata chemical engineer, stated the
following: ``It was a question that came up. Ammonium nitrate
propellant, won't that blow up?'', a question he asked. And,
number two, Mark Lillie, a former senior engineer with Takata:
``It is a basic design flaw that predisposes this propellant to
break apart and, therefore, risk catastrophic failure in an
inflator.''
And these all were before you all made this decision. You
made the decision anyway to move forward with this. Now, that
is a problem for us and for the American consumer and for the
individuals that have lost their lives or have lost their
eyesight or have been hurt by this.
So what was Takata's response to the concerns raised by Mr.
Britton and Mr. Lillie?
Mr. Shimizu. Congresswoman, let me explain about materials,
ammonium nitrate we are using. And, first, that material itself
is safe and stable. And I am not aware of----
Mrs. Blackburn. Mr. Shimizu----
Mr. Shimizu. Yes.
Mrs. Blackburn. I am sorry to interrupt you. That is not
the response that I am asking you for. I understand what
ammonium nitrate is. I know very well what it is.
I am asking you: You had two people, a senior engineer and
a chemical engineer, that brought it to your attention that
this was not a wise choice. I am asking you, sir, when they
brought this to your attention, what did you and your team at
Takata say in response to these engineers? Did you blow it off
and say, it doesn't matter, it costs less? Did you say, we
think we can get by with this because it is an aggressive
propellant? I want to know what your response was to them.
Mr. Shimizu. Congresswoman, I was not involved at that
time. However, I know it has been a lot of discussion about the
selecting materials for a new type of inflator, and we
considered the chemical properties and also combustion
characteristic of the materials, both advantages and
disadvantages. And we decided that we can control--that we
are--some weak area and we can----
Mrs. Blackburn. Mr. Shimizu, you are avoiding the question,
so let's move on.
What was your first date of employment with Takata? When
did you start to work for them?
Mr. Shimizu. With Takata?
Mrs. Blackburn. Yes.
Mr. Shimizu. Since 1978.
Mrs. Blackburn. Since--oh, so you were around.
Mr. Shimizu. Yes.
Mrs. Blackburn. So we established that you were around
during that time in 1999 when this decision was made. So let me
ask this another way. Did any other Takata employees or outside
parties warn Takata about using ammonium nitrate propellant in
its airbags, yes or no? Anybody else--did you or anybody else
warn them?
Mr. Shimizu. I am not aware of that.
Mrs. Blackburn. You are not aware of that. So you don't
know if anybody else other than these two engineers warned them
that this was a really bad idea. You don't know that.
Mr. Shimizu. No.
Mrs. Blackburn. Were concerns about using an ammonium
nitrate propellant relayed to executives at Takata, yes or no?
And do you know who or when?
Mr. Terry. Go ahead and answer the question.
Mr. Shimizu. Can I confirm your question, please?
Mrs. Blackburn. OK. Were the concerns about using ammonium
nitrate as a propellant relayed to executives at Takata? Do you
know if it made it up the food chain to the C Suite?
Mr. Shimizu. I don't know about that.
Mrs. Blackburn. You don't know. OK. Well, you have a good
team with you. We will allow you to respond.
My time has expired. Let's see. I have five other
questions. I will submit these in writing, and we would like an
answer before the end of the year.
Yield back.
Mr. Shimizu. Yes.
Mr. Terry. Thank you.
The chair now recognizes the gentleman from Maryland. Mr.
Sarbanes, you are recognized for 5 minutes.
Mr. Sarbanes. Thank you.
Mr. Shimizu, Takata, as I understand, has agreed to the
recall, at its expense, with respect to both driver-side and
passenger-side airbags within the regions where there is high
absolute humidity. Is that correct?
Mr. Shimizu. Yes.
Mr. Sarbanes. OK.
And you said to Congressman Waxman a moment ago that you do
not yet know the root cause of the defect or the problem with
the deployment of those airbags with respect to that regional
recall. Is that correct?
Mr. Shimizu. Congressman, we haven't identified the root
cause yet. That is why----
Mr. Sarbanes. OK.
Mr. Shimizu [continuing]. We continue collecting the
inflator. But we have a strong opinion of what will contribute
to this defect.
Mr. Sarbanes. OK.
Mr. Shimizu. Which is high humidity and temperature and the
life of the product.
Mr. Sarbanes. Mr. Chairman, I am good to take more time
than you want to give me, but the timer is not running. So I
just thought I--that was a courtesy. I will get that back later
sometime.
Mr. Terry. That is nice of you.
Mr. Sarbanes. Appreciate it.
My question is, if you don't know the root cause, how do
you know that the replacement part that you are providing
solves the problem? Is it different enough in its design that
you have confidence that the replacement doesn't continue to
have the same problem?
Do you understand----
Mr. Shimizu. Yes.
Mr. Sarbanes [continuing]. My question?
Mr. Shimizu. Congressman, the current product we are
producing right now is produced from the most recent line,
which is all countermeasure and the lessons learned from the
previous issues was built into that. So I am quite confident
that products produced from the current production line,
including replacement kits, should work as designed and are
safe.
Mr. Sarbanes. OK. So the production line--the issue is that
you can't yet quite identify the root cause that was part of
the prior production line that created this problem, but you
have confidence that, as a result of the new production line,
whatever that problem might have been is now solved going
forward----
Mr. Shimizu. Yes.
Mr. Sarbanes [continuing]. With respect to the replacement
vehicles.
Mr. Schostek, you implied the idea that, not withstanding
Takata's decision to resist a national recall, that to the
extent the auto manufacturers on their own initiative decide to
expand a recall nationally that, as a practical matter, we
could end up having a national recall. Although I guess there
are some differences of opinion by the manufacturers as to the
scope of that, and I am going to ask Mr. Westbrook about that
in a moment.
I take it that if you on your own initiative decide to
expand the recall beyond what Takatais agreeing to, you are
making a decision to, at least on the front end, incur the
expense of getting that replacement airbag in place and then
you will, I guess, down the road try to recover that? Is that
how it works? As opposed to where they have agreed to the
recall, the expense is absorbed on the front end by Takata; is
that right?
Mr. Schostek. Congressman Sarbanes, for us, we start and
end with our customers, what is right for our customers. And
that is the action we are trying to take here.
It is true that, as an industry, with regard to what have
been regional recalls up to this--regional safety improvement
campaigns up to this point in time, and now we are going to
make it for our vehicles a national safety improvement
campaign, it is true that we have theories but we don't know
the cause. So our interest is getting as much information as
possible.
It is also why, as was announced yesterday--and we
appreciate Toyota's leadership on this issue--that we as
manufacturers have decided we need to share--we need to, first
of all, engage an expert outside third party. Takata will
continue to do their tests, and we will continue to receive
that information from them. But I think, as an industry, as an
auto industry, we are saying it is going to be better for all
of us if we can gather information more quickly. And it is in
all of our interests, Congressman, to find the cause and then
to be able to reassure all of our customers and reassure the
public of safety on the roads.
Mr. Sarbanes. Thank you.
Let me just--Mr. Westbrook, let me ask you, because I have
just 1 minute, I understand that Honda supports a national
recall on the driver-side airbags. And on the passenger side--
which, by the way, on the driver side, Takata does not support
that, and Takata does not support it on the passenger side.
But BMW does support it on the passenger side, although not
on the driver side, right? And that that may be because BMWis
concluding that there may be some other problem specific to the
passenger-side airbags that you think goes beyond or is
separate from this other issue we have been talking about.
Can you just briefly--you have 15 seconds--explain this
discrepancy?
Mr. Westbrook. Thank you.
We have a unique design on the passenger side that might
not be known to the committee. Our passenger-side airbag is
unique in its design and its manufacturer.
From Takata, in 2013, we had our first indicator through
production processes that the parts were out of specification.
In 2014, they gave us another indication that, due to high-
absolute-humidity areas, we might have a risk. And we took,
then, the third indicator that our unique design could create
the risk of additional airbag-related injuries--not related to
a ruptured inflator, because as of today we have never seen one
single ruptured inflator.
So we are simply trying to cover our risk and look after
our customers. We think they deserve that.
In terms of the national campaign, we are complying with
what NHTSA has sanctioned, which is--excuse me, the local
campaign or the regional campaign. That was what we are working
on right now.
And we will begin independent testing. We are under
contract with a well-known European testing organization that
actually specializes in propulsion and airbag safety. This is
underway, and we expect to get results. We will share those
results. We will collaborate. We will make everything--as we
have always tried to get ahead of this thing and just do the
right thing.
Mr. Sarbanes. All right.
Thank you.
Mr. Terry. Thank you.
The gentleman's time has expired.
The chair now recognizes the chairman emeritus. The
gentleman from Texas is recognized for your 5 minutes.
Mr. Barton. Well, thank you, Mr. Chairman.
You know, here we go again. I wasn't here for the opening
statements, but it seems like every few years we have a hearing
with some automobile manufacturer that they have had some sort
of a defective part and they treated it as more of a
manufacturing quality-control issue and not as a serious safety
issue.
It is ironic, in this case, that the part is something that
is supposed to protect the driver or the passenger, and it
turned out that the airbag or the deflator or something in the
airbag was defective.
None of us--I mean, we have some people that are
technically trained on the committee, but we are not automotive
engineers or safety experts. So, we ask questions of you folks
and then later on of NHTSA, and then we kind of cross our
fingers.
I am just puzzled and disappointed that, here we go again.
So my most serious questions will be reserved for the NHTSA
witness in the second panel, but I would ask Mr. Shimizu if--
and I may not be pronouncing your name correctly--in the short
term, the old saying is ``don't dig the hole any deeper.'' I am
told by my friends at General Motors that there is a shortage
of repair kits to do the replacements. And there are a couple
of GM products that were using the Takata airbags.
How soon will you have enough good kits available so that
we can go ahead and do the recalls for the cars that we have
already recalled?
Mr. Shimizu. Congressman, regarding our capacity of the
replacement kits, we are now boost up to 350,000 pieces per
month, and it is going to increase to 450,000 pieces per month
the January by adding 2 more lines.
And we continue to work on--are discussing with automakers
to increase the capacity. And as Mr. Schostek mentioned, that
is we also are taking option to evaluate our competitors'
inflator if it is feasible.
So we would take every action necessary to support to speed
up the replacement of the----
Mr. Barton. OK. Well, now, I am just an old Aggie engineer,
so I am--but there are about 7 million cars, I think, that
have, all in all, been recalled. At 450,000 kits a month, that
is a year and a half or longer. Do you think that is
acceptable?
Mr. Shimizu. It is not speedy enough. We understand the
issues. So that is why we are discussing to add the capacity of
the productions, but it takes a month to be ready for that. But
we do everything we can do at this moment.
Mr. Barton. Well, what does the driver do with a vehicle
that is in a recall that is not going to be repaired for
another year and a half or 2 years? Do you just disconnect the
airbag? Just hope you don't have----
Mr. Shimizu. Not on the driver side. No, it is impossible.
I understand the situation, so that is why----
Mr. Barton. I mean, I am not trying to be rude about it,
but----
Mr. Shimizu. So, actually, one, the data shows that still
we should focus on regional area. In that case, we can supply
to fulfill the demand of our carmakers at this moment, if we
focus on that area first as a priority. Or if we do a phase,
taking a phase, that is, by adding production capacity, we can
catch up the supply-ability to the demand.
Mr. Barton. Well, my time is about to expire.
Are there other manufacturers that manufacture an
equivalent airbag product that you could substitute for your
airbag and repair these cars that have already been recalled?
Or is that just not, technically and engineering-wise,
feasible?
Mr. Shimizu. It requires some validation tests, but is a
certain competitor's inflator could be used to replace----
Mr. Barton. I would suggest that you look at that.
Mr. Shimizu. Yes, Congressman.
Mr. Barton. Because the sooner the cars that have already
been identified are repaired, the better off you are going to
be, in my opinion.
With that, Mr. Chairman, I yield back.
Mr. Lance. [Presiding.] Thank you very much, Mr. Barton.
The chair recognizes the gentleman from Kentucky, Mr.
Yarmuth.
Mr. Yarmuth. Thank you, Mr. Chairman.
And I thank the witnesses for their testimony today.
You know, I wish I could say I felt better about this
situation now than I did when I talked about into the room, but
I think I feel a little bit more uncertain than I wish I did.
I have a little bit of a personal history with this issue
because I was a young Senate staffer on the Commerce Committee
in the early 1970s when Ralph Nader came to the Congress and
urged the mandatory airbag legislation. And so I know we have
been putting airbags in cars for a long time.
Mr. Schostek--I would like to hear from all the
manufacturers how long you have been putting airbags in your
vehicles.
Mr. Schostek. Congressman, it is since the 1990s, I am
pretty sure, the 1990s.
Mr. Yarmuth. Early 1990s.
Toyota?
Mr. Westbrook. I am not quite so sure, but I think it was
the late 1980s that we started. Could have been early 1990s.
Mr. Yarmuth. And BMW?
Mr. Saadat. Same.
Mr. Yarmuth. Same thing.
And while I know that historically there have been
incidents involving spontaneous deployment of airbags and so
forth, but correct me if I am wrong, the issue we are dealing
with today, these inflator ruptures, did not happen before this
era that we are talking about, within the last 10 years; is
that correct? Are you aware of any instances of an inflator
rupture that occurred before the turn of the century?
Mr. Westbrook. No.
Mr. Yarmuth. All right.
And I assume that there was no relevance of humidity in any
of the prior instances of malfunction of airbags prior to the
turn of the century, essentially, this 10-year period.
So I am getting at this issue of the root cause.
And, Mr. Shimizu, what possibly changed other than the
change in propellant that you used from before this time period
when you actually changed propellents? Is there anything else
that changed in the technology that you could reasonably
identify as a potential cause of this inflator rupture prior to
this period?
Mr. Shimizu. We understand it is the characteristic of the
materials we use, which is ammonium nitrate, and we considered
moisture have to be controlled during the operation, and we do
it. And unfortunately we have some issues in the past of the
equipment and the moisture control, but we believe that with
real control we will manage the environment of the operation.
Mr. Yarmuth. But what I am getting at is I think we have
pretty much excluded any other potential root cause other than
the propellant that is being used. Nothing else changed in
technology. None of these occurrences happened before the
change in propellant.
So, regardless of whether it is humidity-related,
temperature-related, the propellant seems to be the only
variable that could be responsible for these kinds of
malfunctions. Is that correct or not?
I mean, if nothing else changed and we never saw it before
you changed propellents, wouldn't you say that it is reasonable
to assume that the propellant is the root cause?
Mr. Shimizu. Congressman, this rupture case happened
because of either abnormal chemical reaction inside the
inflator or weakness of the inflator body. So either, if the
balance was not there, then a rupture may happen.
So we are focused on the materials also now, but also one
of the factor we can consider is the body side. But at this
moment, according to our investigation, we didn't see any
abnormality on the body side. That is why we focus on the
materials.
Mr. Yarmuth. OK.
Going a little bit further--and this is expanding on Mr.
Sarbane's question--you filed a 573 Safety Recall Report just a
month or so ago involving a defect in the airbags produced in
Mexico. Is that correct?
Mr. Shimizu. Yes, the airbag was produced in Mexico for----
Mr. Yarmuth. Right. So you are actually still producing
airbags that have defects in them. And I don't know what the
nature of that defect was, but, again, it goes to the question
of--and I know we don't have too much time--it goes to the
question of whether we can be confident that even the
replacements that are being provided are safe.
And I guess any of the manufacturing representatives who
are here might want to respond. How can you be confident that
the replacement parts you are putting in or that the airbags
you are putting in today are safe if you are still buying them
from Takata?
Mr. Shimizu. Congressman, that specific issue happened in
Mexico, but it is not currently--many years ago. And if my
understanding is correct, that plant is already closed and
moved to Mexico.
And, as I said, all lessons learned from previous issues,
we addressed to--we identified the problems and addressed to
the production process and are taken care of. So the current
production is, as I said, capable to produce the quality parts,
and I am very confident that the quality is there.
Mr. Yarmuth. All right.
I would like to submit, Mr. Chairman, that question and
have the manufacturers respond to the committee as to how we
can be confident that the equipment that they are using today
is safe.
Mr. Terry [presiding]. Absolutely.
Mr. Yarmuth. Thank you very much. I yield back.
Mr. Terry. The chair recognizes the vice chair of the
subcommittee, the gentleman from New Jersey, Mr. Lance.
Mr. Lance. Thank you, Mr. Chairman.
Mr. Saadat, are Toyotas on the road in the United States
today safe, regarding the airbag issue?
Mr. Saadat. Sir, every time there is a safety recall----
Mr. Lance. Yes.
Mr. Saadat [continuing]. And the vehicle has yet to be
repaired----
Mr. Lance. Yes.
Mr. Saadat [continuing]. There is always a risk.
Mr. Lance. Yes.
Mr. Saadat. OK. In the case of people residing in the area
of high humidity, we are urging our customers to please follow
the instructions of the letters that we have sent to them. And
as long as they do that, they can operate the vehicle safely.
Mr. Lance. And if that is done, there are enough airbags
available so that that can be accomplished immediately?
Mr. Saadat. Takata has indicated they have significantly
increased the production starting from this month, and I think
we have a good amount of inflators that we should be----
Mr. Lance. Thank you.
Mr. Westbrook, the same question to you, regarding BMWs.
Mr. Westbrook. Would you repeat, please? I am sorry. Are
they safe?
Mr. Lance. Yes. Are BMWs safe for the driving public in the
United States of America today?
Mr. Westbrook. We believe they are. We have no knowledge of
any inflator rupture, to this date, on any BMW on any airbag on
any side of the car.
Mr. Lance. Same question to you, Mr. Schostek, regarding
Hondas.
Mr. Schostek. Yes, Mr. Vice Chairman. There are recalls in
effect for Honda vehicles from the past, and we are urging
those customers to get their vehicles fixed. If there is not a
recall, then I think we do believe that those customers are
safe.
I do want to address the situation----
Mr. Lance. And there are enough airbags so that for those
that are being recalled the problem can be fixed immediately?
Mr. Schostek. That is where I was going, sir. Yes, at the
present time, we have seen the supply of replacement parts is
adequate to match the demand.
We appreciate the attention on this issue. It is actually
causing more customers to come forward and to get their
vehicles repaired. These are usually older vehicles, and
getting a high completion rate on recalls is difficult to do.
Mr. Lance. And you are confident that the recalls you have
suggested are inclusive of all of the problems?
Mr. Schostek. Yes, sir.
Mr. Lance. And that there is not likely to be further
recalls of Hondas?
Mr. Schostek. There is a safety information campaign where
Takata has not yet identified the defect or cause of that. We
are participating, as are other industry members, with that. We
are going to expand that to a national campaign, as we talked
about this morning. And there may be, sir, a time when
replacement parts become a little short.
That is why we are working with not only Takata but two
other manufacturers, Autoliv and Daicel. And we believe, based
on recent discussions with those others companies, that there
are good prospects to reduce the shortage.
There is not a shortage right now, sir. We expect there may
be a shortage in the foreseeable future but that we are trying
to do our best to----
Mr. Lance. Thank you. Thank you.
Mr. Shimizu, I have in front of me the letter that Takata
sent in response to the request of the government. The letter
is dated yesterday. It is from Mike Rains, the director of
product safety.
Does he work for you?
Mr. Shimizu. Yes.
Mr. Lance. And he is director of product safety in this
country or throughout the entire system?
Mr. Shimizu. Mainly focused on this country.
Mr. Lance. This country. Thank you.
I find the response tendentious, argumentative, and not
particularly helpful.
For example, Takata complains that you have only had 2
working days to respond, given the intervening Thanksgiving
holiday. How long has Takata known about this problem?
Certainly more than 2 working days.
Mr. Shimizu. Excuse me. Could you repeat the question
again?
Mr. Lance. I find the response--and we will be asking NHTSA
about this later, because NHTSA is our next witness. I find the
letter very unhelpful and extremely tendentious.
``Takata's current view, based upon reliable information,
does not support a nationwide determination of a safety defect
in all vehicles equipped with the subject driver-side
inflators.''
That is not the view of the agency at the Federal
Government that protects the American people. And so you are
dramatically and diametrically in opposition to the view of
NHTSA. Is that accurate?
Mr. Shimizu. Can I confirm the question?
Mr. Lance. Certainly.
Mr. Shimizu. Excuse me.
[Confers with interpreter.]
Mr. Shimizu. Congressman, sorry to take so long.
Mr. Lance. Certainly. You have every right to confer with
your colleague.
Mr. Shimizu. Yes. Correct. That is our statement.
Mr. Lance. Thank you.
In conclusion--and we will be asking this of NHTSA later in
the hearing--on November 26, NHTSA demanded a national recall
of driver-side frontal airbags in writing, with a deadline of
December 2nd. You have responded in the negative. If the
company fails to act, NHTSA will continue the statutorily
required process needed to force Takata to act. And, certainly,
my line of questioning this afternoon will be related to that.
I think that we have to work more closely together to make
sure that the American people are safe.
Thank you, Mr. Chairman.
Mr. Terry. Thank you.
And the chair recognizes the gentleman from Mississippi,
Mr. Harper, for 5 minutes.
Mr. Harper. Thank you, Mr. Chairman.
Thank each of you for being here today.
Mr. Shimizu, this is a matter of safety and concern for
everyone who is a driver and families, children, those that
might be impacted.
Can I ask you, the propellant that is used, the ammonium
nitrate-based propellant that is used now, when was the
decision made to--and when did you stop using tetrazole and
move to the ammonium nitrate-based propellant?
Mr. Shimizu. I am not sure, Congressman, exactly which
year, but I believe it was added to them 2003 or--let me
confirm the exact date, so I will get back to you.
Mr. Harper. It has been at least more than 10 years ago,
correct?
Mr. Shimizu. Yes.
Mr. Harper. Maybe late 1990s, early 2000?
What is the cost difference between the propellant
tetrazole versus what is used now? How much does that affect
the price of an airbag?
Mr. Shimizu. According to my knowledge, there is not much
difference, but I don't know the actual cost.
Mr. Harper. OK. But isn't tetrazole much more expensive as
a propellant?
Mr. Shimizu. Only I can guess, is ammonium nitrate is not
more expensive than tetrazole.
Mr. Harper. Well, why was the decision made to switch from
one to the other but for cost?
Mr. Shimizu. No, the reason to change--the reason to change
to ammonium nitrate is not the cost. It is because of the--
there are many other reasons why we choose ammonium nitrate.
Mr. Harper. What is the propellant for the replacement
airbags that you are manufacturing as we speak?
Mr. Shimizu. Excuse me?
Mr. Harper. What propellant is used on the replacement
airbags, the ones that you are manufacturing now?
Mr. Shimizu. Yes, it is the same propellant we used before.
Mr. Harper. Do you foresee changing the propellant as you
move forward with ramping up your production of those to
approximately 450,000 per month?
Mr. Shimizu. If we have to change the materials to replace
parts for the recalls, then it is--because of characteristics
of the inflator itself is different. So we have to go through
the validation test. That is the main reason we continue to use
the same inflator. And of course that would come from the
current production line, so it is considered safe.
And one more thing, sir, if I can. We have second-
generation inflator also, which we use for another type of
models, and we continue to work on improving the performance of
the propellant or inflator.
Mr. Harper. Do you believe that the cause of the ruptures
or the early deployment of these airbags or the ineffectiveness
of that, is that due to the propellant, or do you believe that
it is some other cause?
Mr. Shimizu. My understanding is this cause of the problems
is not materials we use. It is because of the manufacturing
processes and the humidity control in the plant.
Mr. Harper. I certainly want to--I would like to ask Mr.
Saadat some questions, if I may, with Toyota on the approach
that you have had. How many vehicles, Toyota vehicles, are
impacted by the recall?
Mr. Saadat. Approximately 878,000.
Mr. Harper. OK. And it is my understanding that Toyota was
the first to initiate a nationwide recall. Is that correct?
Mr. Saadat. Our nationwide recall has been in effect since
2013, April of 2013.
Mr. Harper. And just as a matter of convenience, are you
providing loaner vehicles to the customers who come in? Are you
giving them a vehicle, a loaner or a rental?
Mr. Saadat. Yes, if that is what they--if that is what they
desire, yes.
Mr. Harper. OK.
Mr. Westbrook, is that something that BMW is doing?
Mr. Westbrook. That is what we are doing, yes.
Mr. Harper. OK.
And Honda?
Mr. Schostek. Yes, Congressman. Right now, as I said, parts
are in adequate supply right now, but if a customer needs a
loaner vehicle or a rental car, we provide that to them at no
charge.
Mr. Harper. Mr. Saadat, if I may ask, you mentioned
earlier, and I know you covered it, but you said there are not
any driver-side airbag issues for Toyota. Why is that?
Mr. Saadat. The problematic inflators that Takata has
identified, they are not installed in our driver side in the
U.S.
Mr. Harper. Different supplier for your driver-side airbag?
Mr. Saadat. Yes.
Mr. Harper. OK.
What prompted you, Mr. Saadat, to start supplying inflators
to Takata for testing?
Mr. Saadat. There was a preliminary evaluation that was
open by NHTSA in June of this year and requested all automakers
to send parts that they have collected----
Mr. Harper. OK.
Mr. Saadat [continuing]. And send them to Takata for
testing. And that is what prompted us.
Mr. Harper. What about independent testing? What are we
doing there?
Mr. Saadat. In terms of independent testing, we have
retained the service of an independent engineering firm to be
able to help us and give us more assurances on the root cause
of this issue.
Mr. Harper. OK.
Mr. Westbrook, any independent testing that BMWis engaging
in yet?
Mr. Westbrook. We are under contract to begin engaging in
that. We are collecting the airbags under, you know, this
regional campaign, and we will start that shortly and make
those results available.
Mr. Harper. Thank you very much.
My time has expired. I yield back.
Mr. Terry. The chair recognizes the gentleman from
Missouri, Mr. Long, for 5 minutes.
Mr. Long. Thank you, Mr. Chairman.
Mr. Shimizu, how many people would need to die before you
would be willing to do a nationwide recall?
Mr. Shimizu. Five people died from the incident.
Mr. Long. That is what have died now, but my question is,
how many more would need to die before you do what NHTSA
recommends, which is a nationwide recall?
Mr. Shimizu. I don't think----
Mr. Long. Do you have a litmus test? I mean----
Mr. Shimizu. Again, we are still doing regional recalls for
researching purpose, and we didn't identify the root cause of
this problem yet. But such an incident, serious incident, a
chance to have such an incident in outside region is minimal,
according to the data we have.
Mr. Long. It is my understanding that the airbag, when it
explodes, it is metal projectile, shrapnel, so to speak, that
has cut veins and led to some of these deaths. Is that correct?
Mr. Shimizu. Once it has happened, that is the phenomenon,
yes.
Mr. Long. So it is sort of tantamount to driving down the
highway with possibly a shotgun aimed at you behind the
steering wheel or behind the glove box, I guess, and not
knowing which airbag is going to explode at what time and act
as a shotgun would, such as shrapnel.
Mr. Shimizu. Congressman, in the past, 2 million times the
airbag deployed as designed and saved the people lives and also
saved the peoples from the serious injury from the accident.
And, yes, we have some issues, and we have to address that, as
we did in the past.
So we considered products we are making right now today is
safe, and also we have some concerns on the region, which is
with the high temperature, the high humidity. That is why we
are continuing to investigate to identify the root cause right
now.
Mr. Long. You are confident the ones you are making now are
safe, but we all know that the ones that are on the road now,
there is a possibility they are not safe, correct, that would
be covered with a nationwide recall?
Mr. Shimizu. Excuse me. Let me confirm the question.
Mr. Long. Sure.
[Confers with interpreter.]
Mr. Shimizu. Congressman, sorry to take time.
For the area outside regional recall, all data we have
doesn't support such a risk at this moment. So we consider it
safe.
Mr. Long. I don't know that I understood the answer.
Mr. Shimizu. Yes, OK. I----
Mr. Long. My question is, the ones that are being
manufactured today you are confident are safe, but the ones
that are out there on the road now that will be not be recalled
because you are not willing to do a nationwide recall, those
are not safe, perhaps, correct?
Mr. Shimizu. We considered it safe----
Mr. Long. You think they are safe.
Mr. Shimizu. Pardon?
Mr. Long. You think they are safe?
Mr. Shimizu. Yes.
Mr. Long. OK.
And you are confident--from the testimony I have heard
today, I am given to understand that you think that it is a
humidity and a heat--function of heat and humidity. Is that a
one-time situation, or is it a compound situation?
And let me give you an example. If I live in Cheyenne,
Wyoming, low humidity, and I want to go a wedding in
Jacksonville, Florida, in my Honda that has a Takata airbag,
should I make that trip? Am I OK to go down there? I am only
going to be there a few days in the heat and humidity. Would
that be a safe trip to take or not?
Mr. Shimizu. Congressman, I consider it is a kind of
compound situation, which is the vehicles or products have to
be extensive period of time under a high-temperature, high-
humidity condition.
Mr. Long. OK. So if I was going to move from Cheyenne,
Wyoming, to take a job in Jacksonville, Florida, and I was
going to there, then you would recommend that I get my airbag
replaced, correct? If I was going to live there year-round and
there was going to be heat and humidity year-round, you would
recommend I get the airbag replaced.
Mr. Shimizu. There are many----
Mr. Long. I want to keep my family safe.
Mr. Shimizu. I consider it safe, but that is why--we still
didn't identify root cause yet, so that is why we continue to
test. Sorry, it is hard to answer to the question.
Mr. Long. Let me ask the gentleman from Honda.
Mr. ``Schostek''--is that correct?
Mr. Schostek. ``Schostek.'' That is right, sir.
Mr. Long. Same question to you. I live in Cheyenne,
Wyoming, and I want to go to Jacksonville, Florida, take the
family down there for a wedding. Are you confident I am safe in
a Honda to do that, or is it a compound effect on the heat and
humidity? Should people not travel to high heat and humidity
areas with Takata airbags for short trips?
Mr. Schostek. Again, we have had national recalls related
to Takata manufacturing defects----
Mr. Long. That is not my question. I appreciate you have
done that.
Mr. Schostek. OK.
Mr. Long. I mean, that is what I think Takata should do, is
a national recall. And I appreciate that Honda has done that.
My question is, if someone was going to make a trip and had
not done the recall process----
Mr. Schostek. Yes, Congressman Long, the phenomena of
inflator ruptures that we have seen over the years is occurring
in vehicles that are fairly old vehicles--8 years old, 10 years
old, 12 years old. It seems to be some function of time----
Mr. Long. So the five deaths in Hondas have been in older
cars?
Mr. Schostek. Yes. And I think the discussion about heat
and humidity, the theory about that is it is over a prolonged
period of time of that heat and humidity cycle potentially
affecting the propellant.
Mr. Long. What is the newest car someone has deceased in in
a Honda? What is the latest year model?
Mr. Schostek. Sir, I believe it was a 2004, but I would
have to check.
Mr. Long. And that would have been what year that the
tragedy occurred?
Mr. Schostek. The most recent one occurred this year, sir,
but in a 2004 model.
You know, there have been four fatalities in Honda
vehicles. All----
Mr. Long. I thought there had been five, so----
Mr. Schostek. I am sorry. Four in the U.S. and one in
Malaysia. So there have been four fatalities in the U.S. In
Honda vehicles. All of those vehicles were subject to that
national recall. One was----
Mr. Long. Right. No, no, and I appreciate Honda doing that.
I appreciate that, but----
Mr. Schostek. And, sir, we wish that we had gotten----
Mr. Long [continuing]. I just think Takata should do that.
Mr. Terry. The gentleman's time has expired.
Mr. Long. I don't have any time, but I would yield it back
if I did. Thank you.
Mr. Terry. The gentleman from Illinois is recognized for 5
minutes.
Mr. Kinzinger. Thank you, Mr. Chairman.
We are going to miss you. You have been a fantastic
chairman, a good friend. And I know you have some great
chapters ahead, but congratulations on the work you have done
on this committee.
To all of you, thank you for being out here.
Just a couple of quick questions. I may not even take all
my 5 minutes. We will make up for Billy Long there.
Sorry, Billy.
To the three of you, I will just ask generally: Do you
believe there is currently sufficient data available to support
NHTSA's call for a national safety recall for all Takata
driver-side airbags?
Mr. Westbrook. No.
Mr. Kinzinger. OK. We will just ask down the line for you
guys. Go ahead.
Mr. Saadat. In reference to driver side, as I stated, we
don't have any of those problematic inflators on our driver
side.
Mr. Kinzinger. OK. So you haven't seen that.
Mr. Schostek. And as we informed the committee today, we
are taking the action to expand our safety improvement campaign
for driver-side recalls from regional to national. We want to
get more information to help others in the industry, as well as
Takata and ourselves, to understand what the defect is, if
there is a defect, and to determine the cause.
I think it is important to understand from the customer's
viewpoint, Congressman, that we use these words, ``safety
improvement campaign'' and ``recall,'' and I know it can be
confusing to customers, and we are certainly sympathetic and
empathetic toward that. The notice that arrives in the
customer's mailbox, whether it is one or the other, says,
``Your vehicle is subject to recall. Please bring it in.''
So we have really focused our attention on, OK, what is
happening in the field, what is happening with our customers,
how do they understand what is going on here. And we are really
trying to redouble our efforts to make sure that they
understand that we want them to bring that vehicle in so that
we can replace the inflator.
And then we need to do testing. Takata needs to do testing.
We, as OEMs, need to do testing. We have talked about engaging
a third-party expert engineering firm to do testing.
Mr. Kinzinger. OK.
Mr. Schostek. Because there is still engineering work to
do. We are all engineering companies here.
Mr. Kinzinger. Yes, I got you.
Mr. Schostek. We want to find the answer to this.
Mr. Kinzinger. I am going to----
Mr. Schostek. In the meantime, I think our focus has to be
on what we can do to our customers.
Mr. Kinzinger. OK.
Mr. Schostek. And just----
Mr. Kinzinger. I got you.
Mr. Schostek. OK.
Mr. Kinzinger. Yes. I appreciate it.
I am going to shift gears. There has been a significant
discussion about regional recalls and the movement of recalled
vehicles from high-humidity States to other States outside of
those regions.
I believe an area that needs focus by automakers is the
commerce of recycled original equipment manufacturer parts.
Each day, over a half-million recycled OEM parts, the very same
parts designed by your companies to meet your fit, finish, and
durability standards, are sold by professional automotive
recyclers. These parts play an important part in the automotive
supply chain and are readily sold from one State or region of
the country to another.
Recently, GM reached out to professional automotive
recyclers offering to buy back or purchase recalled GM ignition
switches. To accomplish this, GM provided specific OEM part
numbers for the ignition switches that were critical to ensure
that automotive recyclers could identify the specific recalled
parts in their companies' inventories.
To those representing the car companies, do you agree that
sharing OEM part numbers and other identifiable information
with the professional automotive recycling industry would
increase safety?
And--yes. So we will start with that.
Mr. Schostek. Congressman, I myself am not familiar with
the GM action that you described, and I will gladly check into
it and get back to you on that.
But I would bring up another point. Counterfeit airbags are
a problem in this country, as well. And we have been working
hard to, state by state, try to stop the use of counterfeit
airbags. That is a big danger to consumers. We think it is a
big danger to our customers.
Mr. Kinzinger. All right.
Mr. Schostek. We have had some success in some states.
But on the recyclers, sir, I would like to check and get
back to you.
Mr. Kinzinger. And you two?
Mr. Westbrook. We have a process called the Automated Parts
Return. And any component, like an airbag, is subject to this
process. As far as I know, whether it is a recall or not, those
go back to us. If a company like a recycler wants our mirror
caps, they can have them.
Mr. Saadat. Sir, I am an engineer, and I can't really
comment on legislative issues, but I will be happy to provide a
response to you later.
Mr. Kinzinger. OK. And would sharing that information,
would that assist your companies in tracking recalled parts?
Mr. Westbrook. Sharing what information, please?
Mr. Kinzinger. The OEM part numbers with recyclers.
Mr. Westbrook. I can't say that.
Mr. Kinzinger. OK. All right.
Do Honda, Toyota, and BMW currently have a similar buyback
problem in place with professional automotive recyclers? You
guys might have already addressed that.
Mr. Schostek. I am sorry, Congressman. I am not aware of
that. I will be happy to check and get back to you.
Mr. Kinzinger. OK. Great. Thanks.
And, Mr. Chairman, I will yield back 10 seconds.
Mr. Terry. Thank you.
And now the chair recognizes the gentleman from Florida,
Mr. Bilirakis, for 5 minutes.
Mr. Bilirakis. Thank you, Mr. Chairman. I appreciate all
your good work on this committee and in Congress as a whole,
and we are going to miss you.
This is a fundamental issue of safety, and Americans must
be able to trust that the cars they drive are safe. I am sure
you will agree with that. Instead, millions of Americans have
been driving cars with potentially deadly airbags.
The area that I represent, of course, has an increased risk
because this defect has generally been in parts of the country
with high humidity, and that has been stated. Florida has many
residents that are transient. I know you know that, too.
Mr. Saadat, Mr. Schostek, and Mr. Westbrook, the question
is for you: What measures are you taking to correctly identify
customers whose vehicles have been in high-humidity areas for
prolonged periods? How are you contacting them?
We will start with Mr. Saadat.
Mr. Saadat. First of all, in terms of region, what we have
is we basically look at the latest registration, number one. We
are also looking at snowbirds. If a vehicle is transferred and
brought to the region. And, in general, if there is a regional
recall, we contact our customers outside of a region who had
their vehicles in the region or vice versa. So that is----
Mr. Bilirakis. What about if somebody buys a used car? How
would you address that?
Mr. Saadat. We look at the latest registration.
Mr. Bilirakis. Yes.
Mr. Saadat. And based on that, we get information, we will
contact them.
Mr. Bilirakis. OK. Mr. Schostek.
Mr. Schostek. Yes, thank you, Congressman. Thank you for
asking that question. Florida has been the site of 17 of the
incidents that involve Honda vehicles, by far the most of any
state and by far our biggest concern. In fact, there was an
article, I think, in late September in one of the newspapers
that inaccurately reported that Honda was asking dealers not to
contact customers. They were misconstruing a message that we
had sent to our dealers.
In fact, what had happened at that very same time, sir, in
the State of Florida, we had begun 93,000 calls, sent out
125,000 emails, and sent out 76,000 postcards. We believe the
risk is highest in your State, and we are putting extra effort
into locating customers in your State and having some success
with that, sir.
Mr. Bilirakis. OK. Next, I would like to hear from Mr.
Westbrook.
Mr. Westbrook. We have maybe half of it covered. We have a
way to track the car that was bought in Florida because it
would be subject to the recall and that is linked to the VIN by
our database. I do not have an answer to how we would have a
way to track a car. Maybe it was bought in Michigan and spent
the other half of the year in Florida, but I would like to get
back on that.
Mr. Bilirakis. Well, please, work on that, and I would like
to hear from you.
Mr. Westbrook. I will.
Mr. Bilirakis. OK. Again, for the entire panel, would you
let a family member drive a car with a Takata airbag? I would
like for you to answer that. Would you let a family member
drive a car with a Takata airbag?
Mr. Schostek. If the car was subject to recall, I would
advise that family member to get it in as soon as possible and
get it fixed. If the car is not subject to a recall, yes, I
would let my family member. I would drive a car with a Takata
airbag.
Mr. Bilirakis. I would like to hear from the entire panel.
Mr. Shimizu. Yes, I do. I would drive the car with our
airbag.
Mr. Bilirakis. Mr. Westbrook.
Mr. Westbrook. I would drive a BMW with the passenger
recall in place.
Mr. Saadat. If a family member lives in the high-risk area,
I urge them to take the vehicle, and actually--first of all,
follow the instruction, the letters that we have sent to them
and they can operate it safely and take the vehicle. We will
try to take care of them.
Mr. Bilirakis. Would you let them drive it after they went
through that? Or in other words, would you allow them to drive
it, or would you prefer that they drive it?
Mr. Saadat. After the remedy is done, based on the
information that Takata has indicated, that they have addressed
the root cause, yes. But----
Mr. Bilirakis. And you would trust Takata?
Mr. Saadat. As I said before, we have retained the service
of an independent engineering firm to give us more assurances,
sir.
Mr. Bilirakis. OK. Next question. I know I don't have much
time. Mr. Shimizu, Takata has known there were potentially
issues with its airbags as far back as 2004. A decade has
passed by, a full decade. Why hasn't your company been able to
fix this life-threatening defect since then?
Mr. Shimizu. Congressman, every time we recognize the
incident or issues, we immediately jump on to the problems and
try to find root cause of the issues and as soon as we identify
the root cause, we took care of that. We addressed the issues
and we take care of the problems.
Mr. Bilirakis. Yes, but, sir, I mean, it has been a full
decade. Ten years.
Mr. Shimizu. It is a series of----
Mr. Bilirakis. I don't think there is any excuse for not
solving the problem.
Mr. Shimizu. It is every time we found problems and we
immediately take action; however, it is true that we have
series of recalls and different timing and we have some
different cause of the problems. So it is not the same problems
all the time.
Mr. Bilirakis. OK. Thank you. I yield back, Mr. Chairman.
Mr. Lee. Thank you.
Gentleman from West Virginia is recognized for 5 minutes.
Mr. McKinley. Thank you, Mr. Chairman.
Let me try to focus a little bit on the recall notices,
because we are not going to have success with this unless
people bring their cars in and get this thing taken care of.
And we also know that traditionally, 30 to 40 percent of people
ignore their recall notice. And if you think back a little bit
about when Moses came down from the mountain, he came down with
Ten Commandments. He didn't come down with 10 good ideas.
So I am concerned about how much of an emphasis is in that
notice that you better get your car back in. Because I have got
two notices on my car. I have got a Chevy Cruze and I haven't
done anything with it yet, because I don't know yet whether or
not it is a life-threatening situation in my car and I have
ignored it. So I know that 30 to 40 percent of people ignore
them. How effective is the notice that you all are giving that
this car could provide, as Mr. Long said, a shotgun flashing at
you. I am just curious, what is the content of your notice? Is
it just a good idea to bring it in, or if you don't bring it
in, we are going to come after it?
Mr. Saadat. If I may answer first. We have recently
implemented a second-day outreach program, and one, in
particular, is contacting each customer by phone, e-mails, and
follow-up mail to urge them to bring their vehicle in. If they
don't feel safe, we ask them--we will tow the vehicles to the
dealership. And so that is the second-day outreach program. We
have improved our----
Mr. McKinley. Could you share with us a notice that you put
out? You are doing the telephone call as well, with it. I don't
know what BMW or anything--I mean, we have got 10, 12
manufacturers are using these. I am just curious, could you
send our office just a typical notice when you put out a
recall? I am just curious to see what value is it. You really--
do you scare them? Is this a commandment or is this just a good
idea?
Mr. Schostek. I think, Congressman, you are hitting on a
fundamental problem. It is a very important question, because
we need to reach our customers. We have to convince our
customers to get these recalls. We are talking about older
vehicles here. We will send you, sir, both the notice that we
send with regard to a recall and the notice we send with regard
to a safety improvement campaign. I have looked at both of
them. The letter is pretty strong. The request is pretty
strong. Please bring----
Mr. McKinley. If you just send that to me, I would
appreciate it very much.
Let me go to another step with this recall notice. CARFAX
apparently doesn't tell you where your car is. So if I am going
to buy a used car, I don't know--and maybe you can inform me or
educate me about it--but I don't know, I don't believe CARFAX
says that car came from Florida. But now I own a car that has
been in Florida for 12 years, and I buy the car in West
Virginia. Am I going to get a notice that there is a recall?
Mr. Schostek. If that car is recalled, sir, we are checking
our VIN numbers with----
Mr. McKinley. It is a yes-or-no answer. Thank you.
Mr. Schostek. Yes, you should. If a car has ever been
registered in one of those states----
Mr. McKinley. I guess if you go by the VIN number it will
say----
Mr. Schostek. Yes.
Mr. McKinley [continuing]. That you know that car. Because
let's just say I bought a car in West Virginia so it is
registered in West Virginia, but then I take it to Florida and
then I use it in Florida for 12 years and then I bring it back
to West Virginia, or however.
Mr. Schostek. Right.
Mr. McKinley. Who knows where that car really is?
Mr. Schostek. It is a very good question, and, obviously,
we can't sit here and provide you with 100-percent assurance
that we are able to track a car. We do check registration
information in the various States, so we do know it that way,
but it is an area that we need to work harder at, sir.
Mr. McKinley. That is Honda. What about BMW? What about
Toyota? What are you all doing? I am just curious from a pure
mechanical standpoint, how are we checking this?
Mr. Westbrook. This is similar to the answer that I gave to
Congressman Bilirakis from Florida. I think we have it in the
car going the one ways. In other words, if the car is
registered in Florida and we have a campaign in Florida, it is
going to be cross-linked to that vehicle identification number.
The other way around is more difficult to figure out, and as
committed earlier, we will try to get to the bottom of that.
Mr. McKinley. OK. Let me ask, the final question with this,
is that if I have a concern about my car, and I have not
received a recall notice and I take it to a dealer and I say, I
am just uncomfortable. I see across the Nation there have been
deaths reported of this, and I would like to have my airbag
replaced. What does a dealer do? He says, sure, I will take
care of it next week? Or does he say, you don't fit the
profile, therefore we are not going to replace it? If that is
the case, if he says no, where is the liability then?
Mr. Schostek. Congressman, we have instructed our dealers
that we want our customers to be taken care of and want them to
feel comfortable. If they are concerned about their car, we
have loaner cars available, we have rental cars available if a
part is not available to be--and just this week, Congressman, I
requested our service division to contact each and every dealer
we have in the United States. We have more than 1,300 Honda and
Acura dealers, to contact them individually and ensure that the
treatment that the customers are receiving and the respect that
the customers are receiving with regard to these inflator
issues is up to our expectations. We expect our dealers to
accommodate our customers' individual needs.
Mr. McKinley. Even though they have not been recall
noticed, they are going to be taken at no cost to the owner?
Mr. Schostek. At no cost to the owner.
Mr. McKinley. Thank you very much. I yield back my time.
Mr. Lee. Chair recognizes the gentleman from Ohio for 5
minutes.
Mr. Johnson. Thank you, Mr. Chairman. And I would like to
also add my thoughts to you as you make this transition. It has
been great serving with you on this committee, and I wish you
the absolute best.
Mr. Shimizu, I want to get a little bit into the
manufacturing. Prior to coming to Congress, I worked for an
automotive supplier. We made electronic components. Some of the
plants were located near where some of your plants are located.
We understand that there are five inflator types that have been
subjected to these recalls. In terms of producing replacement
kits for those that have to be replaced, can Takata
simultaneously produce new inflators for each type as well as
replacement kits for each type simultaneously?
Mr. Shimizu. Congressman, most of the case, each type of
inflator has their own exclusive line, so the answer is yes, we
can do it.
Mr. Johnson. You can do replacements and new? OK.
Mr. Shimizu. Yes.
Mr. Johnson. Along these same lines, are passenger and
driver airbag inflators produced on the same line or on
separate lines?
Mr. Shimizu. Passenger inflator and driver inflator would
produce a completely different line but from the same plant.
Mr. Johnson. Same plant but different line?
Mr. Shimizu. Yes.
Mr. Johnson. OK. Does an increase in the production of
replacement parts, driver's side replacement parts, affect your
ability to produce passenger airbag inflators?
Mr. Shimizu. Could you repeat your question again?
Mr. Johnson. Does an increase in the production of driver's
side airbags, does that affect your ability to produce
passenger sides bags? Since they are on separate lines, I think
the answer to that is no, correct?
Mr. Shimizu. Correct.
Mr. Johnson. OK. All right. For our folks at Honda, what
analysis, and I saw the press release about the analysis that
you are going to be doing, I think, if I have got it right
here. ``Honda today called for a coordinated industry-wide,
third-party testing of Takata airbag inflators with the goal of
ensuring that all of the inflators that require replacement are
accurately identified and fixed as quickly as possible.''
What analysis did Honda undergo, if any, and have you done
any independent analysis to date to determine if a recall of
the airbags are necessary--or the inflators, rather?
Mr. Schostek. Thank you, Congressman. I think we need to
separate the recall decision versus testing. So the recall
decision that we make is based on information that we receive,
for example, from Takata with regard to manufacturing defects,
they told us what those manufacturing defects were. We did not
simply blindly accept their analysis, but our engineers looked
at it and was it reasonable, and therefore, based on that, we
have effected recalls over time.
With regard to the current problem, which is trying to
understand is there a defect and what could be the contributing
causes, for example, heat, humidity, we began some independent
testing very recently, but we were really appreciative that
others in the auto industry, and especially with Toyota's
leadership that we were able to announce yesterday that many of
us are coming together to share information about testing.
So we still have high expectations of Takata to continue to
do their testing, but I think I can speak for Honda, I can't
speak for the other OEMs, but I can speak for Honda that we
feel a need to validate that and see what else we can come up
with using an expert third-party engineering firm.
Mr. Johnson. Just real quick, we know that at least some of
the data has indicated that humidity, temperature, climate has
had an effect on these inflators. Are you folks doing testing
on virtually every climate scenario in America, the different
regions of the country, and seasonal? Because it changes from
season to season and from region to region of our country. So
are you looking at things other than humidity, like dryness,
whatever?
Mr. Schostek. A very good question. And I can't go as far
as to say every climactic condition in the country, because
that would be going a little too far, I think, but we are
testing from the humid areas but also from other areas of the
country. The purpose of a good engineering study is to have
different samples to look at.
Mr. Johnson. Yes.
Mr. Schostek. And that is what we are doing.
Mr. Johnson. Mr. Chairman, I am prepared to yield back, but
let me just make this statement. Again, coming from an
automotive supplier myself, and I appreciate your candor, but I
think it is a little bit shortsighted to say that we can't test
for all the different climate conditions in the country. If we
already know these inflators are affected by humidity, for God
sakes, we don't know what other climate situations affect the
inflators as well, and I think we need to get to the bottom of
that as well.
So with that, Mr. Chairman, I yield back, and thank you.
Mr. Lee. Thank you.
Does the gentleman from Texas, Dr. Burgess, have any
questions?
Mr. Burgess. Thank you, Mr. Chairman, for letting me be
here. I will not seek time from this panel. I am anxious to
hear from our next witness.
Mr. Lee. Thank you.
There has been a request from the full committee chair,
therefore, by my set of rules, he is recognized for 5 minutes.
Mr. Upton. Just to pose another question. And there has
been a number of different articles that have been written over
the last number of weeks regarding secret tests, and I am
looking at--we will give you this for the record--this is a
CNBC story. And it reads, ``The Japanese manufacturer at Takata
secretly conducted tests on 50 airbags that it retrieved from
scrap yards, according to two former employees involved in the
test, one of whom was a senior member of its testing lab.
Results were so startling that engineers began designing
possible fixes in preparation for a recall, but instead of
alerting Federal safety regulators to possible danger, Takata
executives discounted the results and ordered the lab
technicians to delete the testing data from that their
computers and dispose of the airbag inflators in the trash,
they said.'' It goes on, and USA Today, other publications have
reported similar stories.
This particular story indicates that a Honda spokesman,
this must have been last week, on Thursday, Chris Martin from
Honda said in a statement, ``This is a serious allegation about
actions taken by Takata. It is our intention to determine
whether anyone at Honda has any evidence that these claims are
credible,'' so I am anxious just to get a quick response. But
more disturbing, of course, is that a Takata spokesperson, Alby
Berman, declined to comment on the disclosure of the testing.
[The information appears at the conclusion of the hearing.]
Mr. Upton. So if I could just hear from Takata and Honda
briefly, if you would like to respond in writing, you can. But
I am truly troubled by these stories, which is what helped lead
us to this hearing today, and will be asking similar questions
of NHTSA who follows you now. But I ask for the indulgence of
the committee to get a response and maybe we will hear----
Mr. Schostek. Congressman Upton, you mentioned Mr. Martin,
a Honda representative quoted in there. We are continuing to
look and to see if we have any reason to add any credibility to
that. Up to this point, sir, as I sit here, I cannot add any
credibility to that. We will continue to look, but I don't know
of any Honda awareness of that testing in 2004, sir.
Mr. Upton. And this story indicates that testing was done
in Auburn Hill, that is in Michigan. And, of course, this was
about the time that we were doing the TREAD Act, which was a
pretty big story in Michigan.
Mr. Shimizu. Congressman, my answer to your question is,
first, we don't conduct any secret test during 2004. However,
according to our record, we conducted a series of tests in 2004
because of the cushion issues. And we have some cushion tear
issues that happened, and after NHTSA, the one is found during
the test, and then NHTSA informed automakers and then end up to
request us to do a series of tests within a limited time.
So we conduct a series of tests because of cushion tear
problems, not inflators. And we don't use any inflators from
junk yards either. So I think that article is not accurate. But
the fact is, we did conduct a series of tests because of
cushion issues, and actually NHTSA knows about it because it is
an original request from NHTSA. And then after we finished the
test, we found the root of cause, which is the abrasion between
seat cover and the cushions that weaken the cushion and end up
to cause the cushion tears, which it was reported back to
automakers and NHTSA, and automakers end up to do the actual
recall later in 2004.
Mr. Upton. When was it reported to NHTSA?
Mr. Shimizu. I believe it was during 2004. Before NHTSA
back, I believe it is from automakers because they have to do
the recall and I believe November 2004.
Mr. Upton. Well, if you could confirm that in writing
before the end of the week, we would certainly appreciate it.
Mr. Shimizu. Yes. We can get back to the subcommittee by
the end of this week, yes.
Mr. Upton. Yield back.
Mr. Lee. Thank you, Mr. Chairman.
Now the ranking member has one additional question as well.
Ms. Schakowsky. Mr. Schostek, another news report from
November in The New York Times reported that after a 2004
airbag rupture in a Honda vehicle, your company reached a
nonpublic settlement agreement with the injured party and also
reported that you reached nonpublic settlement agreements after
three airbag ruptures in 2007. So I am just wondering how many
settlements like that there are, and if the company feels
itself required to inform NHTSA or the public about these
nonpublic settlements?
Mr. Schostek. Thank you, Congresswoman, for the question.
There certainly are settlements in lawsuits; that is not
unusual in our legal system. But with regard to these airbag
inflators, we have made NHTSA aware of every inflator rupture
that has occurred in a Honda vehicle. So we do not intend to--
the confidentiality of legal settlements is part of our system
here, but that is not to us a reason that is going to cover up
any safety information. We are providing the safety information
regarding inflators to NHTSA.
Ms. Schakowsky. So in all of these particular cases, you
did also give NHTSA the information?
Mr. Schostek. We provided NHTSA with information about all
inflator ruptures, yes, Congresswoman.
Ms. Schakowsky. OK. And in a timely way, 2004, 2007?
Mr. Schostek. So let me just be clear, because there is two
ways. We have been sharing with NHTSA all information about
inflators. We have fallen short on our TREAD obligations, as I
mentioned before. There were eight of them, eight out of the
1,700 related to Takata airbag inflator ruptures. Did we report
those on our TREAD report? The answer to that is no,
Congresswoman. But NHTSA had that information on the basis of
our other communications with them, so it did not, in our view,
hinder the process of continuing to investigate, as we have
been, since 2007, these Takata airbag inflator ruptures.
Ms. Schakowsky. So these legal settlements have nothing to
do, you are saying, with the actual reporting of the problem
for which the lawsuit arose?
Mr. Schostek. Congresswoman, what I am saying is that we
have shared information about Takata inflator ruptures with
NHTSA.
Ms. Schakowsky. OK. Thank you. I yield back.
Mr. Lee. Thank you, and that does conclude the questions
for our first panel. As discussed throughout, there was
mentions of written questions, QFRs. We want to let the panel
know that it is likely you will have written questions
submitted to you. We will do our best to get those to you in a
timely manner, which always means a couple of weeks. And if you
could, likewise, then answer them within a couple of weeks, we
would greatly appreciate them and get them back to us.
So this panel, thank you for your contribution in helping
us better understand. Obviously, this committee is dedicated to
making sure that the people that are driving vehicles are as
safe as they can possibly be. I think you share that as well.
So appreciate your time here today. You are dismissed.
All right. I think it looks like we are set. Acting
Administrator, Mr. Friedman, I appreciate you being here. I
hope you enjoyed the last couple hours of their testimony. And
now you are recognized for your 5 minutes, and welcome.
STATEMENT OF DAVID J. FRIEDMAN, DEPUTY ADMINISTRATOR, NATIONAL
HIGHWAY TRAFFIC SAFETY ADMINISTRATION
Mr. Friedman. Thank you, Mr. Chairman, ranking member, and
members of the subcommittee. Thank you for inviting me to
testify about the serious issues of safety defects in Takata
airbags. Over 10 million vehicles across ten automakers have
been recalled because of inflators that can rupture when
airbags deploy. More than half of these are part of older
recalls associated with known manufacturing problems and four
related deaths that have occurred in the United States.
Many of these vehicles have already been repaired, but many
have not. That is why NHTSA alerted consumers this year to
bring their vehicles in for repairs. Recalls are serious safety
issues and vehicle recall completion rates remain far too low.
I encourage all owners to go to SaferCar.Gov/vinlookup to find
out if their vehicle needs to be repaired under these or any
existing recalls.
In addition to NHTSA's efforts to help consumers, industry
must step up. Automakers must do a better job to aggressively
reach out to consumers to get their vehicles repaired, and they
must report all information required under the TREAD Act.
Dealers have to check VIN numbers for open recalls every time a
vehicle is brought in for service. And, as the administration
proposes in the Grow America Act, rental car companies and used
car dealers should never be allowed to rent or sell vehicles
without fixing them first. Congress can also provide help to
States to implement programs directly linking vehicle
regulation to the repair of open recalls.
Now I want to address the latest airbag recalls. NHTSA
moved to open an investigation based on three consumer
complaints about airbags from three different manufacturers. We
connected the dots. Takata was the common supplier and all were
from Florida and Puerto Rico. We reached out to Takata and the
manufacturers, discovered three additional ruptures, and the
airbags with these or similar inflators are used by several
more manufacturers.
Initial data suggested that the defects in the driver and
passenger airbags were related to prolonged exposure to high
heat and humidity, and so NHTSA acted quickly. And within days
of opening investigation, obtained recalls in areas of
demonstrated risk from manufacturers with the same or similar
inflators. Automakers responded to our call and declared
defects based on a handful of incidents, and, thankfully, no
reported deaths.
Our policy is clear: Vehicle recalls are nationwide, and we
have denied and will continue to deny requests for regional
recalls unless the manufacturer provides solid information
indicating that the risk is regionally limited. The data we had
at the time on the regional nature of the problem was
compelling, and we wanted the manufacturers to quickly recall
the vehicles of those that demonstrated risk. But that was far
from the end of our efforts.
We are actively looking into other claims of injury or
death to determine if they could be related. And while we
continued those efforts, we refused to wait until someone else
got hurt. We had Takata begin testing airbags from vehicles
across the country. The tests so far have provided data
supportive of the regional recall approach for passenger side
airbags, as you can see in this chart.
But when we quickly connected a more recent driver's side
injury in North Carolina to one in California, as you can see
in this chart, and others that did happen in Florida, we acted.
And I called on Takata and the vehicle manufacturers with
driver's side airbags with the same or similar inflators to
expand the driver's side recall nationwide.
Mr. Chairman, it is time again for industry to step up and
put safety first. But we learned last night that Takata has
refused to issue a nationwide notice of a defect in these
driver's side airbags. Until they and automakers act, affected
drivers won't be protected. We are now engaged in a detailed
review of Takata's response to our demand and special order and
will follow up with all appropriate steps to ensure Takata and
automakers protect the driving public nationwide.
Takata must also increase their testing to provide us with
more data to determine the extent and full nature of the
defects. I was encouraged by Toyota, Honda, and Ford's
agreement to engage in coordinated, independent testing in
response to our general order and expect all automakers to step
up. In addition, Takata and the manufacturers must quickly ramp
up production of replacement parts and make these remedies
available to vehicle owners, including by working with other
airbag suppliers.
Finally, if our continued investigation or added testing
show that the passenger side airbag defects are not limited to
regions of high heat and humidity, we will act quickly. Until
then, we want to ensure that the limited supply of passenger
side replacement parts are made available to those that
demonstrated risk.
Mr. Chairman, each day more than 90 Americans lose their
lives due to drunk driving, not wearing a seat belt, and the
many other causes of traffic fatalities. Each hour more than
200 Americans are injured in traffic crashes. As we work each
day at NHTSA, these are tragic reminders of the importance of
our efforts and how we must build on our many successes and
continue to work hard and even harder to protect the American
public.
The case of defective Takata airbags is no different, and
so let me be clear to you: We will continue our aggressive
efforts to protect Americans from defective Takata airbags. We
have acted swiftly and based on the evidence and we will
continue to do so. And if we find any evidence of wrongdoing,
those responsible will be held accountable. Thank you.
Mr. Lee. Thank you for your testimony.
[The prepared statement of Mr. Friedman follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Lee. Now I will recognize myself for 5 minutes to start
the questions. So bluntly: Does NHTSA believe that humidity is
the problem?
Mr. Friedman. It is clear that humidity is one of the
factors and clearly is a major factor when it comes to
passenger side airbags. When it comes to driver's side airbags,
we have to follow the evidence, and the evidence is clear that
the problem is not limited to areas of very high absolute
humidity.
Mr. Lee. All right. So Takata believes that a national
recall of driver's side airbags is unnecessary. Can you explain
with some level of specificity why NHTSA now disagrees,
especially in light of the fact that NHTSA had initially called
for a regional action?
Mr. Friedman. Mr. Chairman, first of all, I was deeply
disappointed by Takata's response and Takata's failure to take
responsibility for the defects in their products. The
fundamental explanation is we have followed the data.
Initially, all of the incidents that occurred in the real
world, with both passenger and driver's side airbags, all
occurred exclusively in Florida and Puerto Rico. When we
expanded the testing and pushed Takata to do the testing, the
same held true for the testing of all passenger airbags, as you
can see in this chart over here.
However, when we saw real-world incidents on the driver's
side, one in California, we pushed Honda to make sure that
their recall covered that region. Then, very recently, we
became aware of a driver's side incident in North Carolina.
With six total incidents, two of which are outside that region,
we can no longer support a regional recall.
Our policy is clear: Recalls must be nationwide unless the
manufacturers can demonstrate that they are regional. With the
new data, it is clear, they can no longer demonstrate that the
region that was used before was appropriate for driver's side
airbags.
Mr. Lee. Specifically, the cars that you referenced, North
Carolina, and the California, Santa Monica area, what is the
level of absolute humidity there, and is it so different that
you can say, backing up what you are saying is that it needs to
go to a more national level?
Mr. Friedman. If we could put up chart D over here. What
chart D is, is data from NOAA indicating the median annual dew
point temperature. And dew point dumper is basically the
measure of the total amount of water in the air or the absolute
humidity.
As you can see, the brown areas are where we saw initially
all the incidents. Then we started to see some passenger
incidents in the red areas. The new incidents in California and
in North Carolina are roughly around the edge of the yellow and
green areas, clearly indicating that they are outside of the
areas of the regional recalls and in areas of lower humidity.
Mr. Lee. This is why this issue is particularly difficult
to get my mind around. So if the issue is the absolute
humidity, what caused the defect in California and North
Carolina autos?
Mr. Friedman. Mr. Chairman, you are asking the exact same
questions we are asking. One of the most frustrating parts
about this is that neither the automakers nor Takata have been
able to get to the bottom of the root cause on this. We have
been pushing them to do so. We are also working and hope to
within a week hire outside expertise and begin standing up our
own testing capabilities so that we can supplement the work
that they are doing.
But they are responsible legally for getting to the bottom
of this, and we have pushed them to do so including requiring
answers to questions under oath to force them to do so. But
between the fact that the root cause on the driver's side is
not clear, now that it is clear that it is outside of those
areas of high temperature and high humidity, and the fact that
we now have six total incidents, it is clear to us that a
regional recall is no longer appropriate for the driver's side
airbags.
Mr. Lee. Very good. I appreciate that. So in regard to the
humidity aspect, the three automakers testify that they believe
humidity is the root cause. I don't have the level of
confidence in that, but they have said they are going to hire a
third-party independent inspection of whether it is related to
the humidity or something else. So my question--very quickly
answer--do you believe that as well, that a third-party
independent inspector is absolutely necessary?
Mr. Friedman. I believe we need to put all resources
forward to address this issue. But also, let me be clear: A
root cause is not required for a recall. All that is required
for a recall is an unreasonable risk to safety, and that is
clear on the driver's side that there is an unreasonable risk
to safety outside of the areas of the highest humidity and
temperature.
Mr. Lee. I agree with that latter part, but the reality is
for the consumer is if the root cause isn't identified, how can
you have confidence that they have solved the problem by
putting in a new airbag?
Mr. Friedman. And we share your concern and we will
evaluate the adequacy of the remedy to make sure that the
American public is safe.
Mr. Lee. Thank you.
Mr. Friedman. Thank you.
Mr. Lee. Recognize the ranking member, Jan Schakowsky.
Ms. Schakowsky. Thank you, Mr. Chairman.
On November 26, NHTSA issued a recall request letter to
Takata acknowledging that, as you have just said, that there is
a safety-related defect regarding the driver's side airbags. I
wanted to know why did this request go to Takata alone, either
instead of or in addition to the manufacturers? Why hasn't
NHTSA issued recall request letters to the automakers demanding
that they expand the recalls of the driver's side airbags?
Mr. Friedman. Ranking member, on November 17, I called on
Takata and then followed up the next day and called on all the
involved manufacturers to recall these vehicles. So I made a
verbal demand to them. The reason why we put a written demand
to Takata is because once Takata does the right thing and
agrees to this, it doesn't matter what the automakers do. There
is a clear statement of a defect and all the automakers must
recall those vehicles. So what we are looking to do is to get
these vehicles recalled as quickly as possible.
Ms. Schakowsky. No, I understand that, but Takata has said
no to you.
Mr. Friedman. Absolutely.
Ms. Schakowsky. And so it would seem to me, since that was
their option, that it would make sense to go to the automakers
as well.
Mr. Friedman. So we are evaluating Takata's response, and
in our next steps, we will work to push Takata and the
automakers to recall these vehicles nationwide. I noted the
action by Honda today----
Ms. Schakowsky. Correct.
Mr. Friedman [continuing]. Which is a clear and promising
action, but clearly also not enough. Much more needs to be done
and we will push and use all the extent of our authority to
push Takata and the manufacturers to address the safety----
Ms. Schakowsky. Well, what is the authority now that Takata
has said----
Mr. Friedman. Well, our authority under the Safety Act is,
our next step could be to issue an initial decision of a defect
and then we would hold a public hearing giving Takata the
opportunity to provide any evidence they have. So far they have
not provided any compelling evidence. We would give the same
opportunity to the automakers. After that hearing, we would
weigh all the evidence and make a final determination.
Ms. Schakowsky. And how long would that take?
Mr. Friedman. I cannot tell you yet because we just got the
materials----
Ms. Schakowsky. Frame of reference. Order of magnitude. How
long?
Mr. Friedman. Order of magnitude before a hearing could be
certainly multiple weeks and likely multiple months.
Ms. Schakowsky. OK. Let me also ask you a question about
your climate map. The darkest part--well, there is Florida, but
then there is also Texas. And yet, on the original regional
recall, you didn't include any part of Texas. Why is that?
Mr. Friedman. So all of the original incidents occurred in
Florida or Puerto Rico, and so Florida and Puerto Rico were
included in those regions. This chart doesn't show all the
gradations in humidity levels. That said, we have pushed all of
the automakers involved to cover the same region, at least the
same region, not just in Florida and Puerto Rico, but all
around the Gulf Coast to ensure not just that the darkest color
is included, that there is a significant buffer zone outside of
the darkest area and the red area.
Ms. Schakowsky. No, I understand. It is just curious to me,
if you think that at least humidity is a key factor, why the
first choices wouldn't be those areas of highest humidity in
your initial recall?
Mr. Friedman. Well, it was because all of the data pointed
to incidents in initially kind of the more southern parts of
Florida and Puerto Rico. So we went with the initial data, but
as we got more data, we acted quickly to make sure that the
recalls were expanded. That was one of the benefits of the
testing that we pushed Takata to do is that we started seeing
failures outside of that area and that made clear to us that
the evidence was pointing to the need for a broader recall.
Every time the evidence has pointed to the need for a broader
recall, we have pushed industry to act on that evidence.
Ms. Schakowsky. OK. I want to go to another topic. You know
that our ranking member of the full committee, Waxman, and I,
had introduced new auto safety legislation this year, which,
among other things, would improve the early warning reporting
system by requiring manufacturers to provide more information
making more information public. Could you--let's see, maybe I
will just put this in writing. If you could briefly describe
how the early warning reporting system currently works. If you
could provide us that information, that would be great.
Mr. Friedman. We will do so. Thank you.
Ms. Schakowsky. OK. Thank you.
Mr. Lee. Thank you.
The chair now recognizes the full committee chairman, Mr.
Upton for 5 minutes.
Mr. Upton. Thank you, Mr. Chairman.
And welcome back, Mr. Friedman. So you have seen these
reports----
Mr. Friedman. Yes.
Mr. Upton [continuing]. The one that I cited earlier and
USA Today. I think you might have actually written a response
to that in terms of the editorial, as I recall, a number of
weeks ago. So as you try to connect the dots, since these
stories have emerged, what have you done as it relates to going
back to Takata and seeing whether or not do they really do
these? I mean, were they really off hours and weekends, and
what do they do with the evidence, and how does that comply?
I don't know if there is enough evidence--I am not a
lawyer--enough evidence to go back to the TREAD Act and see if,
A, they were true, if there is actually someone as liable for
criminal sanctions. I mean, what is your response behind the
scenes to what has been reported publicly?
Mr. Friedman. Mr. Chairman, we took two steps: First of
all, we looked into all of our information; but second of all,
we issued special order to Takata compelling them under oath to
provide us with all information on any testing that they have
done related to the use of the bags.
Mr. Upton. And have they done that? Have they reported back
yet?
Mr. Friedman. They have. They provided their submission as
of December 1, and my team is now pouring through the
voluminous data to get to the bottom of this. I share your
concerns. When we saw those reports, we acted quickly to ensure
that we could get to the bottom of this.
Mr. Upton. So since they only reported back Monday, will
you be able to share with us what they submitted?
Mr. Friedman. We will dig into all that information, and we
will be more than happy to brief you and the committee on what
we find.
Mr. Upton. What has been your response to the the reports
and the underreporting, the 1,700-some cases by Honda as
relates to how you-all are supposed to function?
Mr. Friedman. My personal response was shock and
frustration that Honda has failed so significantly to follow
the TREAD Act. Again, we issued a special order to Honda to get
to the bottom of this and to push them to discover not only
about the 1,700 failures, but what other failures are
associated with their reporting of early-warning data and
information. Our team has gotten back that information, also
just recently. We are digging through that information and to
determine--they have already basically admitted their guilt.
Now the question that we are trying to determine is how many
different ways did they fail, and how many different ways might
we have to consider fining them to the full extent of the law?
Mr. Upton. And have you communicated with the other auto
companies, all of them, in terms of what Honda did and to make
sure that, in fact, the other companies have not followed that
same type of pattern?
Mr. Friedman. So we have two steps along those lines. One,
and my expectation is, you would have asked me that exact same
question, and so today I am calling on each and every automaker
to do an audit of their early-warning reporting and provide
that information to us to ensure that they are fully following
the TREAD Act and can demonstrate that to us.
We are looking at other measures, potentially compelling
them to provide such information. But I think every automaker
should take the responsible step right now of doing their own
audit to determine and ensure that they are appropriately
following the TREAD Act, and, if they are not, report that
information to us and fix the problem immediately.
Mr. Upton. Now, you indicated in your testimony that you
have been responsible for Takata quadrupling their testing.
Have you determined that by quadrupling that rate, would that
be sufficient to generate the needed data to understand the
current problems?
Mr. Friedman. No. In fact, I was very encouraged to hear--
well, first of all, we continue to push Takata to do more;
second, I was very encouraged to hear Toyota, Ford, and Honda
agree to do additional testing; further, we issued a general
order to each and every automaker involved to require them to
provide us with all the information they have on testing. We
are trying to push the entire industry to ramp up their
testing. We are also working to stand up some test facilities
of our own so that we can verify the work that they are doing.
Mr. Upton. Appreciate it. I yield back.
Mr. Lee. Chair recognizes the full committee ranking
member, Mr. Waxman.
Mr. Waxman. Thank you very much, Mr. Chairman.
On November 18, NHTSA announced that it was calling on
Takata and automakers to expand the current regional recall of
defective driver's side airbags to a national recall. NHTSA
based this decision to expand the recall on airbag failures
that occurred outside of the high-humidity areas covered by the
regional recall.
Mr. Friedman, have you determined that humidity is no
longer a key factor or contributing factor to ruptures in these
airbags, and have you determined that consumers outside of
high-humidity regions are potentially in danger from ruptures?
Mr. Friedman. Regarding passenger side airbags, all the
data continues to point to an issue associated with high
temperatures and high humidity over long periods of time. On
the driver's side airbag, while humidity may still be a
contributing factor, it is now clear based on the evidence,
that that is not simply the dominant factor, which is why we
have called on them and made clear to them that while we accept
regional recalls where the evidence supports it, the evidence
no longer supports a recall limited to those previous areas.
Mr. Waxman. Yes. In September, Ranking Member Schakowsky
introduced a bill that requires that all recalls occur on a
national basis. Mr. Friedman, cars are mobile and often moved
from state to state. Can you commit to reevaluate the procedure
that allows for regional recalls based on climate or
environmental conditions?
Mr. Friedman. Ranking member, each and every day we are
looking at how we can do more and do better for the American
public. This issue has certainly caused us to continue to look
into this issue.
Mr. Waxman. Yes. Mr. Friedman, the committee has received
Takata's testing results from over 2,500 airbags that were
collected as part of the regional recalls or safety improvement
campaigns. These results are a bit perplexing. They show no
ruptures from the driver's side airbags but they show more than
60 ruptures of passenger side airbags. In the case of one auto
manufacturer with one type of airbag, one of every eight
airbags from southern Florida vehicles ruptured during tests.
Can you help us understand why NHTSA has asked for a
national recall on the driver side airbags but has not done so
with the passenger side airbags, even though Takata test
results seem to show higher risk for those airbags?
Mr. Friedman. So if you look at chart A, the red dots are
multiple cases during the testing of where there have been
failures in passenger side airbags. Each and every one of the
failures in the real world and in testing have all happened in
areas of high temperature, high humidity, consistent exposure
to those areas. In this case, we must follow the data, and the
data on the passenger side clearly indicates that the problem
is in those areas.
That said, our investigation is far from over. We are
pushing for additional testing. And if we receive any evidence
indicating that the problem is broader, we will act and we will
act quickly to protect the American public.
Mr. Waxman. Is the issue with the driver's side airbags a
different issue than with the passenger side airbags? What is
the difference that makes you confident in calling for a
national recall only on the driver's side airbag?
Mr. Friedman. We are following the data and that is the
basis for our decision. We do know that there are design
differences between passenger side and driver side airbags. But
let me be clear: As Takata and the automakers indicated, they
have not yet gotten to the bottom of the root cause of this
issue. That is a critical step that we are pushing for and we
are involved in because getting to the root cause will help
dramatically clarify things for consumers, for automakers, for
suppliers, and for the actions that each and every one must
take.
That is a critical step, and we will continue to push
ourselves and industry to get to the bottom of this. That is
one of the reasons why we are now looking to get under contract
hopefully within about a week and expert in propellents and
airbag production and design so that we can have added
expertise on top of the experts we already have to get to the
bottom of this as quickly as possible. We will leave no stone
unturned in our efforts.
Mr. Waxman. Honda failed to report 1,729 serious accidents
resulting in injuries or deaths to NHTSA between 2003 and 2014.
Eight of these incidents involved Takata airbags. Can you
explain how this information could have been used by NHTSA if
Honda had reported it like it was supposed to, and can NHTSA
penalize Honda for this failure to report? And in your view,
would increasing the penalties help ensure that manufacturers
report the information they are supposed to do?
Mr. Friedman. Ranking member, the way we would use and the
way we use all of the early-warning information is to spot
trends the spot cases where there are potential defects.
Anytime an automaker fails to provide that information to us,
it leaves us more hamstrung in our ability to find these
problems quicker and to get these problems fixed sooner.
One of the things that we are determining right now, based
both on Honda's admission of their failure and on the
information they have provided, is to what degree penalties are
appropriate, but I can assure you we will hold them accountable
to the full extent of the law. That said, as you indicate, our
maximum penalty for any single incident is only $35 million.
Sadly, for too many car companies, that is pocket change. That
needs to change.
And under the Grow America Act, the President and the
Secretary have called for the maximum penalty to be increased
to at least $300 million so that it will send a much clearer
message. We have worked over the last 6 years and have fined
automakers more than $160 million using our authority, more
than any administration ever has before, but it is clear to us
that we need a bigger stick.
Mr. Waxman. Thank you. Thank you, Mr. Chairman.
Mr. Terry. Thank you, Mr. Waxman.
Now recognize the vice chairman, Mr. Lance, for 5 minutes.
Mr. Lance. Thank you very much. Mr. Chairman.
I am interested in the time frame moving forward.
In answer to Congresswoman Schakowsky's question, you said
it might be weeks or months. I would like a little more
specifics on that.
Your November 26 letter--well, there was a response on
December 2nd, a response with which you fundamentally disagree,
and I would imagine I disagree as well.
What is your next step, Mr. Friedman?
Mr. Friedman. Thank you, vice chairman.
Our next step--in fact, my team already began, once we
received that--the information from Takata both on Monday in
response to our special order and yesterday in response to our
recall demand, we are digging into that data. We are evaluating
their arguments. We are marshaling our evidence.
Mr. Lance. Is their argument in the three-page response
that they gave you? Because----
Mr. Friedman. That is the extent of their argument.
Mr. Lance. Rather weak, weak tea, in my judgment.
Mr. Friedman. I would agree.
Mr. Lance. So what is the timeframe? Because the American
people need to be assured that their automobiles are safe, and
what is your next step and when will that occur?
Mr. Friedman. Our next step after evaluating all that
information would be to issue an initial determination--initial
decision of a defect to Takata and the automakers. After that
we would hold a public hearing.
Mr. Lance. And how soon can you initiate that?
Mr. Friedman. As soon as humanly possible. Vice chairman,
the key--because we want to protect the American public, we
need to make sure that we build the strongest case possible
because at the end of the day, if Takata and the automakers
continue to refuse to act, we are going to have to take them to
court, and we want to make sure that we have a case prepared
that we will win in that circumstance.
Mr. Lance. You can build a court case over time. So can you
estimate for the committee and through the committee to the
American people when your next step will be taken?
Mr. Friedman. We have already begun our next step of diving
into the data.
Mr. Lance. That doesn't answer my question, Mr. Friedman.
The next legal step, not just diving into the data, when will
you next do something officially regarding Takata and the
automakers?
Mr. Friedman. Vice chairman, I apologize, but at this point
because there is voluminous data from Takata, I can't give you
an exact estimate. My team is working furiously and as a
quickly as possible, and as I indicated earlier, it could be
weeks, it could be months, but it certainly won't be many
months if it is. I could see something happening----
Mr. Lance. And then if that were to occur, let's say it
occurs by the 1st of February, and I would hope sooner than
that, and then what happens?
Mr. Friedman. We will hold the hearing if they refuse----
Mr. Lance. And the hearing has to be held within what time
frame?
Mr. Friedman. The Safety Act does not establish a
specific----
Mr. Lance. Does not 45 days or 30 days or----
Mr. Friedman. Right. The Safety Act does not establish
that. We will move to have that----
Mr. Lance. So from our perspective, I think it should be
time of the essence?
Mr. Friedman. I agree.
Mr. Lance. And then what happens after that?
Mr. Friedman. And then after that we will--if the evidence
still points to the need for a broader recall, we will issue a
final determination that will compel Takata and the automakers
to act. If they fail to act, then we will have to work with the
Justice Department to bring them to court and force that
action.
Mr. Lance. And it is the Justice Department that brings
Takata, potentially, and the manufacturers to court.
Mr. Friedman. I would have to get back to you on the exact
process, but my understanding is yes, that we would work with
the Justice Department.
Mr. Lance. And this is a civil action?
Mr. Friedman. I belive that is the case, yes.
Mr. Lance. And then do you refer situations for criminal
prosecution?
Mr. Friedman. Under certain circumstances, the law does
allow us to do that.
Mr. Lance. And, for example, Honda's significant
underreporting under the TREAD Act, is that then referred to
DOJ for civil action or for criminal action or for both?
Mr. Friedman. Well, we have the authority, and we expect
Honda, frankly, to come in and agree to a significant penalty
associated with that. So----
Mr. Lance. That would be a civil penalty.
Mr. Friedman. Yes, that we won't have to move to the
Justice Department on that specific matter.
Mr. Lance. Thank you, Mr. Chairman. I yield back the
balance of my time.
Mr. Terry. Thank you.
The chair recognizes the gentleman from Mississippi, Mr.
Harper, for 5 minutes.
Mr. Harper. Thank you, Mr. Chairman.
And, Mr. Friedman, what is a reasonable period of time to
notify someone?
Mr. Friedman. Automakers are required by law to notify
NHTSA within 5 days of either determining a defect or 5 days of
when they should have known that there was a defect. Then under
regulation, they have no more than 60 days to get a letter like
this into the hands of consumers notifying them that this is an
important safety recall and that they must take action.
That said, even that 60 days, to me, is longer than I would
like to see, which is why we have a VIN look-up tool that every
American can go to at safercar.gov/vinlookup, and even before
you receive these recall notices, you will be alerted of
whether or not there is an open recall for your vehicle. You
can also sign up for added alerts from our app.
Mr. Harper. Sure. Because it is important for the public,
the driving public and passengers in those vehicles, to know
when there is a safety issue. Correct?
Mr. Friedman. It is critically important. Any recall is an
unreasonable risk to safety. Automakers must act quickly to
inform consumers, and consumers should act quickly to get their
vehicles repaired.
Mr. Harper. Well, explain to me how it is that NHTSA knew
that Honda had underreported back in 2012, yet delayed on doing
anything about that?
Mr. Friedman. Well, in 2012, we became aware of a limited
number of unreporting and----
Mr. Harper. A limited--1,700, right?
Mr. Friedman. At the time we were only----
Mr. Harper. Is that a limited number? Why wasn't
something--if we are talking about timeliness being important,
NHTSA didn't meet your own standard.
Mr. Friedman. At the time, we were only aware of eight. It
was only recently that we became aware of these 1,700 problems.
Based on those eight, we pushed Honda to follow standard
process, which is to update their records. Once we found out
that the problem was bigger, we went after Honda. We forced
them under oath to provide us extensive information, and we
will hold them accountable for their failings.
Mr. Harper. But nothing was really done on those eight at
that point, and those 8 were important to the eight incidents
that were involved, obviously. Were they not?
Mr. Friedman. They were important, and we made sure once we
discovered this, that Honda reported that information to us so
that we could act on it. At the end of the day, the safety of
the American public is always our top priority, and making sure
we had that information was critical to us.
Mr. Harper. Well, it sounds good, but it doesn't seem that
that was exactly the case back in 2012, but I will move on and
ask you, Mr. Friedman, at the November 20th Senate Commerce
Committee hearing, you said NHTSA acknowledged a plan
authorizing dealers to disable potentially defective passenger
side airbags where replacement parts were unavailable as long
as they also tell consumers not to put someone in that
passenger seat.
Is NHTSA's acknowledgement of this approach an endorsement
and should it be an opinion for all manufacturers of vehicles
with passenger side airbags subject to recall?
Mr. Friedman. Congressman, the first and foremost priority
should be getting those passenger airbags fixed.
Mr. Harper. I understand, but is this an acknowledgement
that this is the appropriate plan until you can get a
replacement?
Mr. Friedman. If the parts aren't available and if the
vehicle doesn't have an occupancy set, sir, that would disable
those airbags, then yes, it is clearly an appropriate step to
take in the interest of safety.
Mr. Harper. Can I ask this. As the Nation's top highway
safety traffic official, can you tell this subcommittee that
you will put into writing the legal and policy basis supporting
the disabling of recalled airbags until replacement parts are
variable, or is that already in writing?
Mr. Friedman. Well, this is--so it has been part of our
standard process, one, if a part is broken, then an automaker
can disable it without facing any legal penalties, and we have
made that clear to the automakers involved.
Mr. Harper. So is that a written formal policy of NHTSA?
Mr. Friedman. No.
Mr. Harper. Will it become one?
Mr. Friedman. We will investigate that.
Mr. Harper. OK. Let me ask you, you were in here for the
testimony on the first panel. Correct?
Mr. Friedman. Yes.
Mr. Harper. Did you hear when Mr. Shimizu at Takata
discussed manufacturing versus design and he classified this as
a manufacturing issue? Do you believe it is a manufacturing
problem or design problem, or do you just not know at this
point?
Mr. Friedman. Well, I would argue his testimony was
inconsistent because he was clear that the industry is not
clear yet on the root cause of the problem, which is why we are
pushing to get to the bottom of this.
Mr. Harper. And I know we don't know yet, but do you view
the propellent as the prime suspect right now?
Mr. Friedman. It is clear that the propellent is involved.
That said, we know that other manufacturers in the 1990s used
the same propellents. We are looking to determine whether or
not there have been any ruptures associated with those. So far
we have not found it. If there are no ruptures with those, it
is an indication that if you have a good design and good
manufacturing, the propellent may on its own be safe to use,
but clearly no matter what, if you don't have the appropriate
design and you don't have the appropriate manufacturing, you
have failed to live up to your responsibilities.
Mr. Harper. Even some previous Takata scientists have
indicated early that using an ammonium nitrate-based propellent
was not a safe or good idea. Do you agree with that or disagree
with that?
Mr. Friedman. We are asking the exact same questions, which
is why we have compelled under oath all information from Takata
on all the changes that they have made to the propellent and
why we are bringing in outside expertise who has actually had
experience with these propellents.
Mr. Harper. Thank you, Mr. Friedman. My time is expired and
I yield back.
Mr. Friedman. Thank you.
Mr. Terry. Does Dr. Burgess wish to ask any questions?
Mr. Burgess. Yes. Thank you, Mr. Chairman, I would
appreciate the ability to ask questions of our witness.
Mr. Terry. You are recognized for 5 minutes.
Mr. Burgess. I thank the chairman for the courtesy of the
recognition.
And, Administrator Friedman, thank you for being here.
Obviously we have had a chance to interact on other
subcommittees in other roles, particularly with the Cobalt
ignition problem earlier this year.
Let me ask you a question. Mr. Yarmuth of Kentucky posed a
question to Takata, and then he posed it generally to the
manufacturers, but his time was running short. So he said he is
going to request an answer in writing, and his question
basically was how can we be confident that the replacement
airbags are safe. So let me pose that question to you. Thereis
a recall going on. Various manufacturers are providing
replacement parts. To the extent--can the public be reassured
that these replacement parts are indeed safe?
Mr. Friedman. We believe that the replacement parts, for
example, on the passenger side are safer than the ones that are
in the vehicles. The data points to a median time of over 10
years before the failures have occurred. That said, we are
looking into the adequacy of this remedy, and if we determine
that it is not adequate and it doesn't ensure the safety of the
American public, we will push them to take other steps. This
ties in part back to the root cause question. Getting to the
root cause is part of the key of determining the
appropriateness and the effectiveness of this remedy.
Mr. Burgess. I would just point out there is more than a
semantic difference between safe and safer.
Mr. Friedman. I agree, and I use that term intentionally
because we are still looking into the adequacy of this remedy.
That said, our job is to protect the American public, and if
the American public can be provided with airbags that are
safer, I truly believe that is the right step because that can
save lives.
Mr. Burgess. Well, let me ask you a question, because, I
mean, you just dealt with the propellent a bit, and that has
come up several times this morning, and the fact is the
propellent did change from the '90s to the last decade.
Currently are there ongoing studies to look at the type of
propellent, and, in fact, are there safer 21st Century
propellents that ought to be considered?
Mr. Friedman. Certainly we are aware of the industry
looking at a variety of different propellents. Different
manufacturers use different propellents. Takata themselves has
evolved the formulation of their propellent, and that is one of
the reasons why, as we learn more about that, we have compelled
them to provide all the information under oath of those
changes. We have also been reaching out and been----
Mr. Burgess. Can I stop you there for a second?
Mr. Friedman. Yes. Absolutely.
Mr. Burgess. And it is just--I don't want to project, but
in many ways, the answers today provided by Takata seemed less
than forthcoming, and I don't know whether that is just me that
picked up on that, but do you have similar concerns?
Mr. Friedman. I share your concerns, and that is why, one,
we have required them to answer questions under oath because
now it is not just their word that is at stake. It is much
more, because we can penalize them or ultimately they can be
held much more broadly responsible if they lie under oath.
Second, we are not simply trusting Takata. We are in
conversations with multiple other airbag suppliers, and we are
bringing in outside expertise on this propellent, because we
agree with you. We cannot simply trust the information that
Takata gives us. We need to make sure that we are covering all
our bases to get to the bottom of this for the safety of the
American public.
Mr. Burgess. Well, let me go back to something I think both
Mr. Lance and Mr. Waxman brought this up. Many, many years ago
when not this sub committee but our committee in Energy and
Commerce was doing an investigation into uncommanded
accelerations in vehicles in 2009, ultimately there was--and
you, in response to Mr. Waxman, your--the amount that you can
fine someone is capped at $35 million, but in that instance,
there was, over and above that fine, there was an action by the
Department of Justice. At this point, are you contemplating
additional referral to the Department of Justice on anything
that you have uncovered in this investigation?
Mr. Friedman. We have actually been working and cooperating
with the Department of Justice and helping them in their
efforts since September.
Mr. Burgess. So that is--that is on the table as far as a
future action would be concerned?
Mr. Friedman. My understanding is the Department of Justice
is looking into this matter. I would direct you to them for
additional comment.
Mr. Burgess. Well, I appreciate that, but it--certainly
when that occurred in response to the uncommanded acceleration
issue, while I might agree that your ability to fine is
limited, certainly the past seems to be a fairly significant
legal stick that you had at your disposal and another tool that
might be useful in compelling cooperation.
Mr. Friedman. Well, fundamentally, it was discovered that
Toyota lied to us. Despite their lies, we got to the bottom of
that problem, determined the problem, and got those vehicles
recalled.
That said, we fined them not just once but multiple times
because of their failings, and in that case, we also worked
very closely with the Justice Department in efforts that
ultimately led to their fine of more than a billion dollars, so
we----
Mr. Burgess. For the record, I did not mention a
manufacturer, you did. I want that to be clear.
Mr. Chairman, I appreciate the time and I will yield back.
Mr. Terry. Thank you.
Recognize the gentleman from Maryland for 5 minutes.
Mr. Sarbanes. Thank you, Mr. Chairman.
I just have a question about your capacity as an agency and
whether you feel that you have the resources you need to do the
job, and, you know, what your capacity currently is in terms of
reinforcing public disclosure and encouraging greater
transparency, and looking at this particular incident that we
are investigating or that we are having testimony on today;
would enhanced capacity, additional staff dedicated to the
Office of Defect Investigations to the early warning reporting
and so forth, would that have assisted your agency in this
instance? And then more broadly, if you could speak to your
capacity. That would be helpful.
Mr. Friedman. If mean, the simple and straightforward
answer is yes. I mean, we are a small agency that I would argue
punches well above our weight. Over the last decade, our
efforts have led to the recall of nearly one million vehicles,
but it is also clear when you have a fleet of over 260 million
vehicles and multiple manufacturers, multiple potential safety
issues, that we need more resources to ensure that we can do
everything we can to keep the American public safe. The
President's budget has continued to request additional
resources both for our Office of Defects investigation, but
also for the rest of our agency.
Congressman, 33,561 people died in 2012. 33,561 tragic
lives lost because of issues such as drunk driving, people not
wearing their seat belts, vehicles that could have had more
technology on board to keep them safer. There is no doubt in my
mind that with more resources, we can do more to address the
epidemic that faces Americans in terms of fatalities and
injuries every year on our roads.
Mr. Sarbanes. I would imagine that those resources would
help you both kind of chase information on the front end, it
would get you to a place of, you know, pushing for solutions as
well as not having to maybe triage or prioritize in ways once
you have got the information in because you have the capacity
to address a number of these things simultaneously.
So I appreciate your providing that testimony, and with
that, Mr. Chairman, I yield back.
Mr. Terry. Thank you. Having no other members requesting
time that then concludes your testimony and questions, and this
committee, as you know, we can submit written questions to you.
I would expect that. We will try to be timely, and request that
your office be timely in their providing us responses to those
questions.
Thank you. You were very informative. We like charts. So
nice job with the visual aids.
Now, have any other closing?
A quick note before we adjourn here is that this
subcommittee and full committee bipartisanly have concerns
about the role NHTSA plays in continuing these--continuing
large-scale recalls, and I hope that NHTSA will fully cooperate
with the GAO as GAO carries out the bipartisan request to look
at NHTSA's internal procedures and processes.
Mr. Friedman. Mr. Chairman, we will definitely cooperate,
and I look forward to working with the committee on ways that
NHTSA can get additional resources, additional people,
additional computer tools so that we can do the very best job
for the American public.
Mr. Terry. Very good.
Mr. Sarbanes. Mr. Chairman, could you acknowledge me for--
--
Mr. Terry. Yes. Gentleman from Maryland.
Mr. Sarbanes. Just wanted to take the occasion to thank the
chairman for his service on this committee and in this House.
We have appreciated his leadership and wish him well.
Mr. Terry. Thank you. I appreciate that.
So we are adjourned.
[Whereupon, at 1:19 p.m., the subcommittee was adjourned.]
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