[Senate Hearing 115-766]
[From the U.S. Government Publishing Office]
S. Hrg. 115-766
UPDATE ON NHTSA AND AUTOMAKER
EFFORTS TO REPAIR DEFECTIVE TAKATA
AIR BAG INFLATORS
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON CONSUMER PROTECTION,
PRODUCT SAFETY, INSURANCE,
AND DATA SECURITY
OF THE
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED FIFTEENTH CONGRESS
SECOND SESSION
__________
MARCH 20, 2018
__________
Printed for the use of the Committee on Commerce, Science, and
Transportation
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available online: http://www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
39-882 PDF WASHINGTON : 2020
--------------------------------------------------------------------------------------
SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED FIFTEENTH CONGRESS
SECOND SESSION
JOHN THUNE, South Dakota, Chairman
ROGER F. WICKER, Mississippi BILL NELSON, Florida, Ranking
ROY BLUNT, Missouri MARIA CANTWELL, Washington
TED CRUZ, Texas AMY KLOBUCHAR, Minnesota
DEB FISCHER, Nebraska RICHARD BLUMENTHAL, Connecticut
JERRY MORAN, Kansas BRIAN SCHATZ, Hawaii
DAN SULLIVAN, Alaska EDWARD MARKEY, Massachusetts
DEAN HELLER, Nevada TOM UDALL, New Mexico
JAMES INHOFE, Oklahoma GARY PETERS, Michigan
MIKE LEE, Utah TAMMY BALDWIN, Wisconsin
RON JOHNSON, Wisconsin TAMMY DUCKWORTH, Illinois
SHELLEY MOORE CAPITO, West Virginia MAGGIE HASSAN, New Hampshire
CORY GARDNER, Colorado CATHERINE CORTEZ MASTO, Nevada
TODD YOUNG, Indiana JON TESTER, Montana
Nick Rossi, Staff Director
Adrian Arnakis, Deputy Staff Director
Jason Van Beek, General Counsel
Kim Lipsky, Democratic Staff Director
Chris Day, Democratic Deputy Staff Director
Renae Black, Senior Counsel
------
SUBCOMMITTEE ON CONSUMER PROTECTION, PRODUCT SAFETY, INSURANCE, AND
DATA SECURITY
JERRY MORAN, Kansas, Chairman RICHARD BLUMENTHAL, Connecticut,
ROY BLUNT, Missouri Ranking
TED CRUZ, Texas AMY KLOBUCHAR, Minnesota
DEB FISCHER, Nebraska EDWARD MARKEY, Massachusetts
DEAN HELLER, Nevada TOM UDALL, New Mexico
JAMES INHOFE, Oklahoma TAMMY DUCKWORTH, Illinois
MIKE LEE, Utah MAGGIE HASSAN, New Hampshire
SHELLEY MOORE CAPITO, West Virginia CATHERINE CORTEZ MASTO, Nevada
TODD YOUNG, Indiana
C O N T E N T S
----------
Page
Hearing held on March 20, 2018................................... 1
Statement of Senator Moran....................................... 1
Prepared statement........................................... 2
Statement of Senator Blumenthal.................................. 3
Staff report dated March 28 entitled ``Automaker Report Card:
Loaner Car Policies for Consumers Affected by the Takata
Airbag Recall''............................................ 4
Letter dated March 19, 2018 to Hon. John Thune and Hon. Bill
Nelson from Safety Advocates............................... 40
Statement of Senator Inhofe...................................... 23
Statement of Senator Nelson...................................... 27
Prepared statement of Alexander C. Brangman, Father of Jewel
Brangman................................................... 28
Prepared statement........................................... 29
Statement of Senator Markey...................................... 32
Statement of Senator Klobuchar................................... 34
Statement of Senator Cortez Masto................................ 36
Statement of Senator Hassan...................................... 38
Witnesses
Heidi King, Deputy Administrator, National Highway Traffic Safety
Administration, U.S. Department of Transportation.............. 20
Prepared statement........................................... 22
John D. Buretta, Independent Monitor, TK Holdings, Inc. and the
Coordinated Remedy Program..................................... 43
Prepared statement........................................... 45
David Kelly, Project Director, Independent Testing Coalition..... 46
Prepared statement........................................... 47
Joseph Perkins, Senior Vice President and Chief Financial
Officer, Key Safety Systems, Inc............................... 48
Prepared statement........................................... 50
Rick Schostek, Executive Vice President, Honda North America,
Inc............................................................ 51
Prepared statement........................................... 53
Desi Ujkashevic, Global Director, Automotive Safety Office, Ford
Motor Company.................................................. 55
Prepared statement........................................... 56
Appendix
Response to written questions submitted to Heidi King by:
Hon. Todd Young.............................................. 65
Hon. Bill Nelson............................................. 65
Hon. Richard Blumenthal...................................... 68
Hon. Maggie Hassan........................................... 69
Response to written questions submitted to John D. Buretta by:
Hon. Todd Young.............................................. 70
Hon. Bill Nelson............................................. 71
Hon. Richard Blumenthal...................................... 72
Hon. Maggie Hassan........................................... 72
Response to written questions submitted to Joseph Perkins by:
Hon. Bill Nelson............................................. 73
Hon. Richard Blumenthal...................................... 73
Hon. Maggie Hassan........................................... 73
Response to written questions submitted to Rick Schostek by:
Hon. Todd Young.............................................. 74
Hon. Bill Nelson............................................. 75
Hon. Richard Blumenthal...................................... 76
Hon. Maggie Hassan........................................... 77
Response to written questions submitted to Desi Ujkashevic by:
Hon. Todd Young.............................................. 80
Hon. Bill Nelson............................................. 81
Hon. Richard Blumenthal...................................... 81
Hon. Maggie Hassan........................................... 82
UPDATE ON NHTSA AND AUTOMAKER
EFFORTS TO REPAIR DEFECTIVE TAKATA
AIR BAG INFLATORS
----------
TUESDAY, MARCH 20, 2018
U.S. Senate,
Subcommittee on Consumer Protection, Product
Safety, Insurance, and Data Security,
Committee on Commerce, Science, and Transportation,
Washington, DC.J
The Subcommittee met, pursuant to notice, at 2:30 p.m. in
room SR-253, Russell Senate Office Building, Hon. Jerry Moran,
Chairman of the Subcommittee, presiding.
Present: Senators Moran [presiding], Fischer, Inhofe,
Nelson, Blumenthal, Klobuchar, Markey, Hassan, and Cortez
Masto.
OPENING STATEMENT OF HON. JERRY MORAN,
U.S. SENATOR FROM KANSAS
Senator Moran. Good afternoon.
The hearing will come to order.
I would announce, as we begin, there is a vote scheduled
for 4:15 p.m. So for the witnesses, at least in the second
panel, there is a cutoff time. I do not anticipate, I cannot
imagine the circumstance in which we recess this hearing for a
vote on the Senate floor and come back. So this hearing will be
concluded by the time we all need to vote.
With that, let me present an opening statement.
Again, welcome all of you to our Consumer Protection
subcommittee's hearing on the Takata air bag recalls. It is the
largest, and most complex, series of automobile recalls in
history.
We are here today because of a simple, but solemn, fact
that the defective Takata air bag problem has resulted in the
tragic deaths of 15 people and have injured well over 200 more
in the United States alone.
Vehicle safety is a core mission of this Subcommittee, and
a great deal has transpired in the Takata recall process since
the Commerce Committee last convened a public hearing on this
matter in June 2015.
In fact, 10 years have passed since the initial recall of
some of the Takata air bag inflators. Thankfully, we now
understand the underlying cause of the defect. As vehicles age,
the threat increases.
We have also learned that Takata misled both the Government
and the vehicle manufacturers. As a result, Takata agreed to a
record $200 million civil penalty and a $1 billion criminal
penalty. We are now making progress to respond to more recalls.
Congress, for its part, passed a number of recall reforms
included in the FAST Act of 2015 in response to the Takata
recalls, and others, at the time.
These provisions sought to improve consumer awareness by
identifying part numbers in safety defect notices, requiring
dealers to notify consumers of open recalls during service
appointments, and improving NHTSA's website. They also tripled
civil penalties for auto safety violations at a cap of $105
million.
I am interested to hear today what impact those reforms
have had on the overall Takata recall effort.
To appreciate the challenges involved in this recall
process, one needs only to reference the sheer scope of it: 50
million air bag inflators in 37 million vehicles under recall
by 19 manufacturers; numbers that are anticipated to continue
to grow in a process that may play out for another 10 or 15
years. It is imperative that these recalled vehicles are
repaired.
Each of our witnesses today are here to provide insight
into this process. We will be asking them, not only for an
update on the recall and remedy efforts for Takata air bag
inflators, but also their plans to continue the progress thus
far made toward full completion.
I am generally encouraged by what I have heard in recent
months regarding the coordination and data sharing between
NHTSA, and automakers, and other stakeholders, but clearly the
results are mixed and work remains to be done.
Specifically, I want to learn more about the innovative
approaches being used to reach the millions of consumers
affected by these recalls. Every consumer is different and we
must identify the methods that are most effective in reaching
each consumer to ensure their safety and that of their
families.
I am pleased to welcome Heidi King, the Deputy
Administrator of NHTSA. She is the agency's highest ranking
official and her first testimony before this Committee. I will
pause to smile and say welcome. We look forward to hearing your
testimony.
I encourage everyone who is watching this hearing today to
pay attention to recall notices on your vehicles, and to call
the closest dealership for repair. You can also look up whether
your vehicle is subject to a recall at www.nhtsa.gov.
Most importantly, I wish to offer my sincere condolences to
those who have lost loved ones because of the defective Takata
air bags, including some who are in our audience today.
Once again, thank you all for being here.
With that, I now turn to the Ranking Member, the Senator
from Connecticut, Senator Blumenthal, for his opening remarks.
[The prepared statement of Senator Moran follows:]
Prepared Statement of Hon. Jerry Moran, U.S. Senator from Kansas
Good afternoon, and welcome to today's Consumer Protection
Subcommittee hearing on the Takata air bag recalls, the largest and
most complex series auto recalls in history. We are here today because
of a simple but solemn fact: defective Takata air bags have resulted in
the tragic deaths of 15 people, and have injured well over 200 more in
the United States alone.
Vehicle safety is a core mission of this Subcommittee, and a great
deal has transpired in the Takata recalls process since the Commerce
Committee last convened a public hearing on this matter in June of
2015.
In fact, ten years have passed since the initial recall of some
Takata air bag inflators. Thankfully, we now understand the underlying
cause of the defect. As vehicles age, the threat increases. We have
also learned that Takata misled both the government and the vehicle
manufacturers. As a result, Takata agreed to a record $200 million
civil penalty and a $1 billion criminal penalty. We are just now making
progress to respond to these alarming recalls.
Congress, for its part, passed a number of recall reforms included
in the FAST Act of 2015 in response to the Takata recalls and others
around that time.
These provisions sought to improve consumer awareness by
identifying part numbers in safety defect notices, requiring dealers to
notify consumers of open recalls during service appointments, and
improving NHTSA's website. They also tripled civil penalties for auto
safety violations to a cap of $105 million. I am interested to hear
today what impact those reforms have had on the overall Takata recall
effort.
To appreciate the challenges involved in this recall process one
need only to reference the sheer scope of it: 50 million air bag
inflators in 37 million vehicles under recall by 19 manufacturers,
numbers that are anticipated to continue to grow in a process that may
play out for another 10 to 15 years.
It is imperative that all these recalled vehicles are repaired.
Each of our witnesses today is here to provide insight into this
process. We will be asking them not only for an update on the recall
and remedy efforts for Takata air bag inflators, but also their plans
to continue the progress made thus far toward full completion.
I am generally encouraged by what I have heard in recent months
regarding the coordination and data-sharing between NHTSA, the
automakers and other stakeholders, but clearly the results are mixed
and there is much work left to be done.
Specifically, I am eager to learn more about the innovative
approaches being used to reach the millions of consumers affected by
these recalls. Every consumer is different and we must identify which
methods are most effective in reaching each consumer to ensure their
safety and that of their families.
I am pleased to welcome Heidi King, the Deputy Administrator at
NHTSA and the agency's highest ranking official, to her first testimony
before this Committee. Later on, we will be joined by a second panel of
stakeholders who are also intimately involved in this recall effort.
I encourage everyone watching this hearing today to pay attention
to recall notices on your vehicle and call the closest dealership for a
repair. You can look up whether your vehicle is subject to open recall
at www.NHTSA.gov.
Most importantly, I wish to offer my sincere condolences to those
who have lost loved ones because of defective Takata air bags,
including some in the audience today.
Once again, thank you all for being here today.
STATEMENT OF HON. RICHARD BLUMENTHAL,
U.S. SENATOR FROM CONNECTICUT
Senator Blumenthal. Thanks, Mr. Chairman, and thank you for
having this hearing, which is as timely as our previous
hearings have been. In fact, this one is our third on the
Takata air bag recall.
The plain, simple truth is that the Takata air bag recall
is the largest, most complex in U.S. history. This recall also
has been plagued by delays; they are deadly delays.
The number of fatalities, since our last hearing, has
doubled. Those are deaths on the road directly attributable to
defective air bags, and there are currently 50 million
defective Takata air bag inflators in an estimated 37 million
vehicles. That is 50 million defective Takata air bags in 37
million vehicles. These defective Takata air bag inflators
continue to cause deaths and pose dangers to Americans. A lot
of them are teenagers who may have no idea that their vehicle
has one of these defective inflators. All of these deaths are
preventable.
Only about half of the vehicles with defective Takata air
bags have been repaired.
Those facts are staggering in an industry that has an
obligation to do better. And I believe that, unfortunately,
NHTSA, Ford, and Takata all are aware of the need to do better.
Today, I ask to be entered into the record a report that my
office has done on loaner cars, if there is no objection.
Senator Moran. Without objection, so ordered.
[The information referred to follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Senator Blumenthal. This delay highlights that loaner cars
must be available to owners of vehicles with defective Takata
air bags. They should have ``Do Not Drive,'' instructions that
automakers should be providing, and they should be making
available loaner cars.
The report indicates--and I have done it with my colleague,
Senator Markey--that loaner cars are not made available by a
number of the automobile manufacturers and dealers. The report,
in fact, found that most automakers do not provide these free
loaner cars, but some do. Six, in fact, do including Honda,
which demonstrates that it is far from unreasonable to expect
that they do so uniformly.
We can address some of these loopholes through legislation.
For example, used car dealers are not required to fix deadly
defects before selling a car. We have proposed legislation to
correct that issue and gap in the present law. I hope that we
can make those kinds of reforms and others.
The other lesson here is that even the comparatively simple
technology of air bags has been plagued with deadly problems.
To take autonomous vehicles, where we have seen just in the
last few days an unfortunate, really tragic death, we need to
be very careful about how we move forward with the AV START
Act.
I have suggested ways that we can strengthen it. That
tragic incident makes clear that the autonomous vehicle
technology has a long way to go before it is truly safe for the
passengers, pedestrians, and drivers who share American roads.
My hope is that we will take a lesson from the experience
with air bags and their defects with the more complex
technology of autonomous driving vehicles. And look carefully,
prepare meticulously, take care of safety before we leap into
an unknown future technology.
Thank you, Mr. Chairman.
Senator Moran. Thank you, Senator Blumenthal.
We now turn to our first panel, which consists of Ms. Heidi
King, who is the Deputy Administrator of the National Highway
Traffic Safety Administration.
Welcome once again, and we look forward to your testimony.
STATEMENT OF HEIDI KING, DEPUTY ADMINISTRATOR,
NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION,
U.S. DEPARTMENT OF TRANSPORTATION
Ms. King. Thank you very much.
Good afternoon, Chairman Moran, Ranking Member Blumenthal,
and members of the Subcommittee.
First, I would like to express that my heart does go out to
the victims and the families of victims that have been
involved, not only in Takata air bags, but in all auto
collisions. I know that everyone in this room shares the
mission of improving safety on our roadways.
Our conversation today focuses on the recall of the deadly
Takata air bags and could not occur at a more important time.
The unprecedented challenge confronts all of us. Each of us in
this room shares that goal of protecting public safety.
Manufacturers have made progress in reaching consumers and
in persuading them to bring their vehicles in for a free
repair, but progress is uneven. Overall completion rates are
not where we want them to be.
The challenge is unprecedented, but there are positive
signs. NHTSA, and the Independent Monitor established under the
Consent Order, have successfully encouraged vehicle
manufacturers to adopt innovative outreach best practices--
including texting, social media, door-to-door canvassing, and
other approaches--that have proven effective with some
consumers who were unresponsive to traditional outreach
methods.
NHTSA's Coordinated Remedy Order has targeted replacement
inflators to those consumers with the highest risk, so that
inflators that pose the greatest danger get repaired first.
The threat, however, is not static. As time passes,
continued exposure to heat and to humidity will increase the
risk of injury or death to those friends and neighbors with
old, dangerous air bags.
Everyone is encouraged to visit NHTSA.gov to check and see
whether their vehicle has an open recall, so they can bring
their vehicle to their local dealer for a free repair. They can
also call 888-327-4236. I would encourage us not only to check
our own vehicles, but check on our friends, our family, our
neighbors, and our colleagues. We all need to get the word out.
I ask each of you to support our shared goal of public
safety, and to help raise consumer awareness of how important
it is that vehicle owners check NHTSA.gov to learn of open
recalls, to call their dealership, and complete their free air
bag replacement.
As members of this Subcommittee know, defective Takata air
bags pose a significant threat to safety. Currently, the Takata
recall involves 19 vehicle manufacturers and has covered
approximately 50 million Takata air bag inflators in an
estimated 37 million vehicles in the United States alone. To
date, over 21 million defective air bags have been repaired.
The recall will continue to be deployed in phases, which
means that more vehicles will be included in the recall in the
next couple of years. The program prioritizes and phases-in the
recalls, not only to accelerate the repairs, but to ensure that
the highest risk vehicles are fixed first.
Prioritizing repairs does mean that some vehicle owners
might have to wait for their replacement air bags and that is
deeply frustrating. But it also means that parts are available
immediately to fix vehicles that pose a greater risk.
While overseeing the historic recall of 50 million air bags
and inflators across the United States, NHTSA has continued to
investigate Takata air bags, including the industry testing of
parts, and is closely monitoring the vehicle manufacturers'
recall efforts. This continued vigilance allows NHTSA to make
sure we are focusing on those vehicles that pose the highest
risk to safety.
A recent example of NHTSA's continued vigilance is the ``Do
Not Drive'' recall by two manufacturers. This ``Do Not Drive''
recall followed a tragic death resulting from improper
deployment of a recalled air bag.
The investigation revealed that there was a previously
unidentified issue that called into question whether there was
additional risk associated with a group of air bags. In
consultation with NHTSA, the manufacturers escalated the
recall.
At this critical stage, we are considering novel ways to
reach consumers and improve response rates. We know that
consumers may not be aware of the risks, and we appreciate your
help in raising awareness. Air bag replacement is free. Every
consumer should check NHTSA.gov to learn whether their car,
truck, or van is subject to the recall.
Finally, Senators, I would like to address a tragic event
that occurred earlier this week in Tempe, Arizona.
Consistent with NHTSA's vigilant oversight and authority
over the safety of all motor vehicles and equipment, including
various advanced and automated technologies, NHTSA has
dispatched its Special Crash Investigations team to Tempe,
Arizona.
NHTSA is also in contact with Uber, with Volvo, with
Federal, State, and local authorities regarding the incident.
The agency will review the information and proceed as
warranted.
As this is an open investigation, I am constrained in what
I can share at this time, but I assure you--I say again--I
assure you that NHTSA, and the Department of Transportation,
prioritize safety above all else.
Thank you, again, for inviting me to be with you here today
to and raise awareness among the public of this very serious
threat to roadway safety--the Takata air bag recall.
I look forward to your questions.
Thank you.
[The prepared statement of Ms. King follows:]
Prepared Statement of Heidi King, Deputy Administrator,
National Highway Traffic Safety Administration
Good afternoon Chairman Moran, Ranking Member Blumenthal, and
members of the Subcommittee.
Our conversation today on the recall of the deadly Takata air bags
could not occur at a more important time. This unprecedented challenge
confronts all of us. Each of us in this room share the goal of
protecting public safety.
Manufacturers have made progress in reaching consumers and
persuading them to bring their vehicles in for a free repair, but
progress is uneven and overall completion rates are not where we want
them to be.
The challenge is unprecedented, but there are positive signs. NHTSA
and the Independent Monitor established under the Consent Order have
successfully encouraged vehicle manufacturers to adopt innovative
outreach best practices--including texting, social media, and door-to-
door canvassing--that have proven effective with some consumers who
were unresponsive to traditional outreach efforts.
NHTSA's Coordinated Remedy Order has targeted replacement inflators
to those consumers with the highest risk so that inflators that pose
the greatest danger get repaired first.
The threat is not static. As time passes, continued exposure to
heat and humidity will increase the risk of injury or death to those
friends and neighbors driving cars with the old, dangerous air bags.
Everyone is encouraged to visit NHTSA.gov and check to see if they
have an open recall so they can bring their vehicle to their local
dealer for a free repair. They can also call 888-327-4236.
I ask each of you to support our shared goal of public safety, and
help raise consumer awareness of how important it is that vehicle
owners check NHTSA.gov to learn of open recalls, call their dealership,
and complete their free air bag replacement.
* * * * *
As members of this Subcommittee know, defective Takata air bags
pose a significant threat to safety. Currently, the Takata recall
involves 19 vehicle manufacturers and approximately 50 million Takata
air bag inflators in an estimated 37 million vehicles in the United
States alone. To date, over 21 million defective air bags have been
repaired.
The recall will continue to be deployed in phases, which means that
more vehicles will be included in the recall in the next couple of
years. The program prioritizes and phases in the recalls to not only
accelerate the repairs, but to ensure that the highest-risk vehicles
are fixed first.
Prioritizing repairs does mean some vehicle owners might have to
wait for replacement air bags. That is deeply frustrating. But it also
means that parts are available immediately to fix vehicles that pose a
greater risk.
While overseeing the historic recall of 50 million air bag
inflators across the United States, NHTSA has continued to investigate
Takata air bags, including industry testing of parts, and is closely
monitoring the vehicle manufacturers' recall efforts. This continued
vigilance allows NHTSA to make sure we are focusing on those vehicles
that pose the highest risk to safety.
A recent example of NHTSA's continued vigilance is the ``do not
drive'' recall by two manufacturers. This ``do not drive'' recall
followed a tragic death resulting from improper deployment of a
recalled air bag. The investigation revealed that there was a
previously unidentified issue that called into question whether there
was additional risk associated with a group of air bags. In
consultation with NHTSA, the manufacturers escalated the recall.
At this critical stage, we are considering novel ways to reach
consumers and improve response rates. We know that consumers may not be
aware of the risks and we appreciate your help in raising awareness.
Air bag replacement is free, and every consumer should check NHTSA.gov
to learn whether their car, truck, or van is subject to the recall.
Thank you again for inviting me to be with you today to raise
awareness among the public of this very serious threat to roadway
safety. I look forward to your questions.
Senator Moran. Thank you, very much.
Let me, first, call upon the Senator from Oklahoma.
Questions, Senator?
STATEMENT OF HON. JIM INHOFE,
U.S. SENATOR FROM OKLAHOMA
Senator Inhofe. Yes, I do. I would be glad to wait until
you conclude with your questions.
Senator Moran. I am happy to defer to you.
Senator Inhofe. All right. I appreciate it very much.
Quite frankly, I am going to address something that is in
the jurisdiction. However, it does not have to do with the
assigned subject that you have. Under the rules, I think that
is my ability.
First of all, I want to thank you, Ms. King. You have
worked with the Committee that I have chaired in the past, and
it has been very successful. I think, frankly, we accomplished
more during the last probably 4 years than any of the rest of
the committees have in terms of the major pieces of legislation
that you have been involved in. I am talking about things like
the Chemicals Act, the FAST Act, the Safe Drinking Water Act,
and the rest of them.
Now since 2008, the EPA and DOT have taken an increasingly
heavy hand in regulating the automotive industry through more
stringent greenhouse gas and Corporate Average Fuel Economies;
that is, the CAFE standards.
Just hours before President Trump's Inauguration, the EPA
issued a final determination effectively locking in its portion
of the 2012 standards through 2025. Obama's EPA acted
unilaterally, instead of working together with the National
Highway Traffic Safety Administration and others, to reexamine
the feasibility of the 2012 standards after five years in a
mid-term evaluation, as agreed. That was agreed to at that
time.
A little over a year ago under President Trump, the EPA and
the National Highway Traffic Safety Administration announced
their joint intention to reconsider the Obama Administration's
determination and reopen the midterm evaluation process.
Now, my question to you, is it true that the National
Highway Traffic Safety Administration is currently conducting a
midterm evaluation to determine if the 2012 requirement to
achieve an average fuel economy standard at 50 miles a gallon
for light duty vehicles, which would include trucks, SUVs, and
minivans, by 2024? Do you agree that that is too aggressive?
Ms. King. That the midterm evaluation is too aggressive?
Senator Inhofe. [Nonverbal response.]
Ms. King. We are working on an analysis to propose a rule
on, or near, April 1 that authorities that NHTSA operates under
only allow us to issue fuel economy standards for periods of 5
years.
So we have been, for quite some time now, anticipating
proposing the next 5 year period and we intend to do so. We are
working toward that now with the expectation of publishing in
April.
We are working closely with our colleagues at EPA on the
midterm evaluation and to make sure that the Federal family is
aligned in the path forward.
Senator Inhofe. That is good.
Now, as you can appreciate, it is particularly important
that all stakeholders are at the table and engaging in dialogue
to demonstrate that this Administration is working
collaboratively on this evaluation, unlike what happened in the
last Administration.
So the question I would have is, would you commit to me,
and to this committee, that you will engage with all interested
public and private stakeholders as you work on the midterm
evaluation?
Ms. King. It is absolutely imperative on something so
important to all of us in the United States that we be open to
all stakeholder views. We have been hearing from stakeholders.
We will continue to do so.
We look forward to a very robust and transparent public
comment process on the proposed rule. And we will, as has been
NHTSA practice in the past, provide information supporting the
rulemaking on our website, so there is full transparency about
any modeling or technical information to support a vigorous
dialogue.
Senator Inhofe. And I appreciate that very much.
My last question: today's trucks and SUVs make up two-
thirds of the vehicles sold, yet these vehicles do not help
automakers meet current DOT and EPA regulations of reaching 50
miles a gallon fuel economy by 2025.
As such, auto manufacturers are making more and more
electrical vehicles and other vehicles American consumers
really do not want at steep losses to try to comply with these
rules. Meanwhile, the average age of a vehicle on the road
today is 11 years and new cars are getting more and more
expensive discouraging consumers from buying new vehicles.
Now, Congress created the Corporate Average Fuel Economy in
1975 because we had a fuel shortage at that time. We no longer
have a fuel shortage, but that did not stop the Obama
Administration from ensuring standards kept increasing beyond
the technical feasibility of technology.
In the 1975 law, Congress specifically required that the
Administrations take into account, this is out of the law,
quote, ``economic practicality,'' which is, obviously, cost.
Is not one of the fastest ways to get cleaner and safer
vehicles on the road to encourage manufacturers to make more
affordable vehicles that consumers want to buy?
So my last question would be, would you commit to me, since
it is in the law, that affordability will be a top priority for
you as you finalize the midterm evaluations?
Ms. King. Of course, NHTSA will consider it and will
propose based on all of the statutory factors, including
economic practicability. That is right.
Senator Inhofe. That is correct. Thank you very much, I
appreciate this.
Ms. King. Thank you.
Senator Inhofe. You are welcome.
Thank you, Mr. Chairman. It is very nice of you.
Senator Moran. Thank you, Senator Inhofe.
The Senator from Connecticut, Senator Blumenthal.
Senator Blumenthal. Thanks, Mr. Chairman.
And thank you very much for being here this morning and for
your good work in your present Acting capacity in a position
that is critically important to safety on our roads and
elsewhere in our transportation system.
Let me ask you, what percent of the vehicles, that so far
have been unrepaired, would you say remain with these defective
air bags because of a lack of supplies of new air bags?
Ms. King. That is a very good question. I would be happy to
see if we have that information to provide. We have not
explicitly tracked that.
We have been focused very much on increasing response
rates, making sure consumers are aware, and that we prioritize
the most dangerous air bags for replacement first. So driving
replacement rates has been our focus.
Senator Blumenthal. And how do you determine which are the
most dangerous?
Ms. King. Through the Coordinated Remedy Order. The
Coordinated Remedy Order that was issued 2 years ago would
define priority groups, taking into account the factors that
have been identified as the key areas of risk, including the
age of the vehicle, which indicates the time of that air bag's
exposure to environmental elements; environmental humidity; and
exposure to heat, and in particular, heat cycling.
Senator Blumenthal. When repair parts, replacements are not
available, would you not agree that the automaker has a
responsibility to provide a loaner?
Ms. King. The automakers are doing their----
Actually, I would say many automakers are, in fact, as we
saw in the loaner report, already providing loaners. I realize
some automakers may not have a policy, but the individual
dealerships might. I think that is a great practice. We have
heard that the consumers----
Senator Blumenthal. It is a great practice.
Ms. King. Yes.
Senator Blumenthal. But my question was, and it is not
meant to be adversarial.
Ms. King. Understood.
Senator Blumenthal. Would you not agree that they have an
obligation to do what, for example, Honda has done in providing
loaner vehicles?
Ms. King. NHTSA encourages all of the auto manufacturers to
take whatever steps they can to reduce the barriers to
consumers having a timely and safe replacement of their air
bag. Yes.
Senator Blumenthal. It is ultimately their responsibility
to put a safe vehicle in consumers' hands.
Ms. King. It is their responsibility to meet the terms of
the Coordinated Remedy Order and to see the vehicles safe for
consumers again. Yes.
Senator Blumenthal. I want to ask a question about the
investigation that you mentioned into the autonomous vehicle
tragedy that occurred.
Do you have any preliminary views on what the cause was?
Ms. King. I do not have preliminary views. As you may be
aware, I have a background in law enforcement, and what I have
always found is that in those early hours after an accident,
the very distressing time when we are dealing with the tragedy,
facts can change and misinformation can be available.
So I take very seriously the responsibility leading NHTSA
to make sure that the investigation is allowed to proceed
responsibly and that I withhold judgment until such time as the
investigation is ready to share information.
Senator Blumenthal. In 2016, as you may be aware, there
were 1.18 fatalities for every 100 million miles driven.
To date, self-driving cars have logged a lot fewer than 100
million miles. Waymo reported logging 4 million miles and Uber
has just reached 2 million miles with its autonomous vehicle.
At this rate, that is one fatality for 6 million miles.
Now, that comparison may be unrepresentative, but is NHTSA
collecting the kind of information that is necessary to assess
whether autonomous vehicles are at least as safe as human
driven vehicles? Are you collecting that data right now?
Ms. King. Vehicle safety information is collected by local
government, State governments, and also by the Federal
Government.
We do work closely with our State members, both in sharing
information and making sure we are all remaining as current as
possible, both on incidents and in aggregate data.
Senator Blumenthal. Would you say self-driving vehicles are
safer than human driven vehicles?
Ms. King. At this point, I would not know how to define
self-driving vehicles, Ranking Member Blumenthal.
One of the challenges we see at the National Highway
Traffic Safety Administration is people use the terms in
different ways.
So, for example, it is not clear to me which technologies
have been in recent use in Tempe, Arizona. So that is one of
the areas of confusion that we see the need to clear up.
Many of the vehicles we see on the roads today for sale to
consumers have, what we would call, Level 1 features, driver's
assistance features, lane keeping, or emergency braking
systems.
There are other advanced systems, but we may use the terms
differently, SAE Levels 3, 4, 5, self-driving, automated
driving system.
Senator Blumenthal. One last question.
Ms. King. Of course.
Senator Blumenthal. Will you agree with me, I would hope
that you would, that the tragic incident in Arizona is a red
flag for the Congress, as well as NHTSA, in moving too fast, or
precipitously, or incautiously with autonomous driven vehicles?
Ms. King. I am confident that all of us share the goal of
public safety on our roadways, and all of us are focused on
everything we can do to that effect.
I await the details of the investigation and the findings
regarding the accident before making judgment on any particular
event. But I look forward to working with you. I look forward
to solving the problem of various issues on our roadways.
Senator Blumenthal. Thank you very much.
Ms. King. Thank you.
Senator Moran. We are pleased to have joining us the
Ranking Member of the Full Committee, Senator Nelson, and I
would recognize him now.
STATEMENT OF HON. BILL NELSON,
U.S. SENATOR FROM FLORIDA
Senator Nelson. Thank you, Mr. Chairman.
I want to talk about the lack of progress on Takata air
bags. And yet, I want you to understand that I have just come
from a meeting with the parents of the three sons that were
beheaded in Syria, and the parents of the daughter who was
repeatedly raped and then killed by Abu Bakr al-Baghdadi. So
you can understand that I am not in a particularly good mood.
It was all the way back in 2014 when we had our first
hearing on defective Takata air bags. And when you fast forward
to today--three and a half years later--we are still dealing
with the big problem of getting vehicles with these defective
and deadly air bags fixed.
And so, we asked in the Committee that all 19 automakers
that have been affected by the Takata recalls update us on the
most recent recall completion rates and the steps they are
taking to improve them. And the responses to the request show
that there is still a very wide variance in the pace of these
recalls.
For example, among the five automakers with the highest
number of vehicles recalled due to Takata air bags, listen to
this, Honda has repaired 70 percent of these recalled vehicles
nationwide as of last month; Fiat Chrysler's completion is 41
percent; Toyota is at 61 percent.
Ford has only fixed about 22 percent of vehicles under
recall. Ford's completion rate is so low because NHTSA allowed
the automaker to delay repairs on more than one million
recalled vehicles.
Last, BMW, the automaker with the fifth highest number of
recalled air bags, failed to provide their most recent
completion rates.
Is this a responsible automobile industry?
Now, Honda has been at this longer than all the others,
which may explain why their numbers are higher. But overall,
these recall completion rates are disappointing, unacceptable,
and remain a cause for great concern.
Mr. Buretta, the Independent Monitor, put out a lengthy
report last year outlining new ideas and strategies to make the
recalls more effective.
Things like mobile service units that can come to consumers
on their schedule and fix defective air bags at their homes or
businesses.
Or incentivizing dealers to offer extended service hours so
the person who works all day--and has to come home, put the
kids to bed--can get their car in and get it repaired without
taking time off.
Do we really want to help these consumers get the recalls
done?
Or what about just a coordinated outreach strategy?
You would think NHTSA would have picked that up and run
with it. But unfortunately, NHTSA seems to be playing a game of
regulatory whack-a-mole and twiddling its thumbs when it comes
to actually enforcing the coordinated recall approach.
And all this is happening while drivers in my state, which
has been hit significantly with these exploding Takata air
bags--and indeed across the country--wonder about the safety of
their vehicles and are left in limbo.
I hope that we are going to finally hear about a forceful
regulatory approach.
I want to recognize Mr. Alexander Brangman, who has
traveled all the way from San Diego. He is in the third row
right back there. Mr. Brangman lost his daughter, Jewel, when a
Takata air bag exploded in her Honda in September 2014.
Mr. Chairman, I want to request that his statement be
entered into the record.
Senator Moran. Without objection.
[The information referred to follows:]
Prepared Statement of Alexander C. Brangman
Good afternoon, I am Alexander Brangman, father of Takata airbag
fatality and victim, Jewel Brangman.
I would like to thank Chairman Moran, and fellow members of this
Committee for the opportunity to submit a statement to you today on
behalf of Takata victims and their families and the American public,
regarding, the critical and life-threatening issue, of the Takata
airbag recall.
Today's hearing is extremely important and I'm thankful to the
committee for its leadership and time in evaluating and addressing this
ongoing, grave threat to public safety.
I represent the worst-case scenario of incompetence, poor ethics
and greed. My daughter came into this world with a birth certificate
and she left with a death certificate, at the age of 26 years, 11
months, 9 hours and 15 minutes . . . due to extreme negligence and
unethical conduct, of systemic corporate behavior that puts profits
over lives.
One would never think, that when you put all the effort into
raising a child to the level of extraordinary accomplishments that my
Jewel rose to: from high school Academic All-American, State Champion &
Pre-Olympic gymnast; to double major college graduate; to Master's
Degree in communication media arts and journalism; and then about to
embark on her Ph.D. at Stanford University, in family therapy . . .
that something that was preventable could impede her progress and
dreams, to try to make our society a better place for us all. A
mechanism that is supposed to save lives is not supposed to be the
reason for taking lives.
The unnecessary practice of putting profits over lives must stop. A
call of action, nationally, needs to be taken, laws need to be enacted
and a competent system needs to be put in place. It needs to be
expedited and taken seriously because too many lives are in perilous
danger.
Albert Einstein once said, ``We cannot solve our problems with the
same thinking we used when we created them.'' In this same light, if we
continue to protect the perpetrators of such nefarious and incorrigible
actions, more lives will be taken, more families shattered, and more
hearts will be broken.
We need leadership and accountability from our legislators,
regulators and partners, not culprits like Takata, who continue to
disregard industry standards by using unstable ammonium nitrate in
their airbags; not culprits like Ford and GM, who seek 2 and 3
exemptions from the recall in the continuance of profits over lives and
public safety.
Unfortunately, this is not the first time such despicable behavior
has led to an extreme loss of life, where corporations have calculated
profits over lives, as evidenced by the Pinto, Firestone, GM ignition
switch and Toyota SUA cases. However, this esteemed committee has the
opportunity to lead by example.
I urge the committee and participants to enact stricter standards
for recall completion rates that are unacceptable and severely lagging;
to prohibit the use of ammonium nitrate in airbags; to fix our flawed
recall system that puts used car owners at a disadvantage in receiving
recall notices, to prohibit the sale of used vehicles with open safety
recalls; to require all automakers to provide loaner vehicles and tows;
to require the use of mobile repair units, just to name a few.
My purpose now, is to bring awareness to those who are not aware of
the seriousness of this issue, to honor my daughter, save lives and
advocate for the necessary changes that will efficiently and
effectively remove these deadly airbags that endanger the lives of our
children, loved ones and fellow Americans on a daily basis.
Thank you for your time and attention in considering this statement
and the serious issue at hand. Please do not hesitate to reach out to
me if I can be of any further assistance in helping to save lives.
Senator Nelson. I think his presence here today is a stark
reminder of the human cost of these defective air bags and a
reminder to all of the witnesses here, especially NHTSA, that
we need to pick up the pace on these recalls.
I will close by saying that the first time that this came
to my attention was in my hometown of Orlando. The police had
come to an intersection to investigate what was to be a normal
fender bender, and they found the driver of the car with a slit
throat. They started to work the case as a homicide. And then,
of course, discovered it was the exploding Takata air bag.
Thank you, Mr. Chairman.
[The prepared statement of Senator Nelson follows:]
Prepared Statement of Hon. Bill Nelson, U.S. Senator from Florida
Thank you, Mr. Chairman.
In November 2014, this Committee held our first hearing on
defective Takata air bags.
Fast forward to today--some three and a half years later--and we're
still dealing with the big problem of getting vehicles with these
defective and deadly air bags fixed.
To try to get a better read on where things stand right now, I
asked all nineteen automakers affected by the Takata recalls to update
us on their most recent recall completion rates and steps they're
taking to improve them.
And the responses to my request show that there is still a wide--
and concerning--variance in the pace of these recalls. For example,
among the five automakers with the highest number of vehicles recalled
due to Takata air bags:
Honda has repaired seventy percent of these recalled vehicles
nationwide as of early March;
Fiat Chrysler's completion rate is forty-one percent; and,
Toyota is at approximately sixty-one percent.
Ford, on the other hand, has only fixed about twenty-two percent of
vehicles under recall. Ford's completion rate is so low because NHTSA
allowed the automaker to delay repairs on more than one million
recalled vehicles.
Lastly, BMW, the automaker with the fifth highest number of
recalled Takata air bags, failed to provide their most recent
completion rates.
Now, Honda has been at this longer than all the other automakers,
which may explain why their numbers are higher. But overall, these
recall completion rates are disappointing and remain a cause for real
concern.
Mr. Buretta, the independent monitor, put out a lengthy report late
last year outlining new ideas and strategies to make these recalls more
effective.
Things like mobile service units that can come to consumers on
their schedule and fix defective air bags at their homes or businesses.
Or incentivizing dealers to offer extended service hours, so the
person who works all day and then has to come home and put the kids to
bed can bring the car in and get it repaired without taking time off.
Or even just a better coordinated outreach strategy.
You would think NHTSA would have picked that up and run with it.
Unfortunately, NHTSA still seems to be playing a game of regulatory
whack-a-mole and twiddling its thumbs when it comes to actually
enforcing the coordinated recall approach and benchmarks for
automakers.
All this is happening while drivers in Florida and across the
country, who wonder about the safety of their vehicles, are left in
limbo.
I hope that we finally hear today about a forceful regulatory
approach that will get us to the end of what has been a long and
frustrating road for the American driving public.
Finally, I would like to recognize Mr. Alexander Brangman who
traveled from San Diego to be at this hearing today.
Mr. Brangman lost his daughter, Jewel, when a Takata air bag
exploded in her Honda in September 2014. Mr. Chairman, I request that
his statement by entered into the record
I think his presence here today is a stark reminder of the human
cost of these defective air bags and a reminder to all of the witnesses
here--especially NHTSA--that we need to pick up the pace on these
recalls before anyone else loses a loved one.
Senator Moran. Thank you, Senator Nelson.
Ms. King, you testified that NHTSA and the Independent
Monitor have successfully encouraged vehicle manufacturers to
adopt innovative outreach best practices to connect to
consumers who have been unresponsive to traditional outreach
efforts.
Have all the manufacturers adopted those practices? And if
not, does NHTSA intend to take any actions to ensure that they
do?
Ms. King. As you know, Chairman, each manufacturer has a
different clientele and different types of drivers, and they
may need to choose approaches that work best for their drivers.
For example, as you and I know, the owner of a Tesla may be
using that vehicle in a different way than the owner of a
pickup truck.
I would say I am not aware of each and every manufacturer
using exactly the same approaches, but we encourage
manufacturers, in fact, we press manufacturers to use the
approaches that work best for their drivers.
This hearing is very helpful for us to get the word out. We
find that making sure that the awareness and the discussion is
ongoing, and that consumers are aware of the urgency of the
problem will only help to improve recall rates, the completion
rates.
Senator Moran. Well, the manufacturers are clearly aware of
the best practices proposal or agreement that comes from you
and the Monitor. True? That is well-known?
Ms. King. Yes, yes. In fact, the Monitor completed a report
in November with some market research showing what some of the
barriers are and we have that posted on our website at
NHTSA.gov. Those best practices are shared in quarterly
meetings hosted by the Monitor at which the manufacturers share
what is working and what is not.
Senator Moran. You have heard two of my colleagues who have
asked you questions to this point complain, discouraged by the
slowness of the process.
What would your recommendation be that would increase the
timeliness of recalls and replacement or repair?
Ms. King. What we are seeing now, although I would not call
anything we are seeing good news, I would say it is heartening
news, and it is encouraging news to see evidence that the
Coordinated Remedy Order is, in fact, working.
Just in the most recent year's worth of data, we saw in
that year alone, the 12-month period, 68 percent more air bags
replaced. We saw just in the past 6 months, 22 percent more
replaced. So, of the 22 million or so air bag replacements, 8.4
million of those were just in the past year.
What we have is an increase in the rate of air bag
replacements. That indicates to us that the outreach efforts
are working. It indicates to us that the supply is working,
that the prioritization is working. But we are not done. That
is not good enough. We have to do better.
We still have more air bags, as Ranking Member Blumenthal
identified, in the field and particularly in those hot, humid
climates.
So while we are encouraged by the progress, we need to do
more.
Senator Moran. When you say, ``We need to do more,'' how
would you define ``doing more''? What would ``doing more'' be?
What would we see?
Ms. King. At the National Highway Traffic Safety
Administration, what we are trying to do is to raise consumer
awareness. We have a multipronged approach. There are
consumers. There is also working, of course, with the auto
manufacturers and with the suppliers of the equipment.
With consumers, we are trying to improve consumer awareness
through novel outreach approaches. For instance, after the ``Do
Not Drive'' recall, I immediately went onto the radio and did a
national radio tour on morning talk show programs to raise
awareness.
We have materials we have developed as slide shows at
Departments of Motor Vehicles. So while consumers and drivers
are at the DMV, they are alerted to the risks.
We have also a program, a novel program, piloted in the
State of Maryland, when a vehicle is being registered, they
will be alerted.
In addition, we have, of course, our website. We have our
phone line and we continue to try and get the word out on the
importance of the recall. That is the consumer piece.
We also work with manufacturers. We are always vigilant to
understand whether or not they are leaning in, whether or not
they are doing what they say they are doing, whether they are
making progress toward the ambitious goals in the Coordinated
Remedy Order.
We are, furthermore, working with the Monitor to understand
the issues in the supply.
Those three pieces--working with consumers, with auto
manufacturers, and also with replacement part suppliers--are
critical pieces of the program.
Senator Moran. Do you have data that would suggest the
percentage or the nature of the consumer, whether he or she is
aware of the recall, but does not act upon, even though aware
versus the consumer who is not aware? Is there a problem with
both and where does that problem mostly lie?
Ms. King. There is some work that is available in the
Monitor's report. There is some other work that may be with the
auto manufacturers. At NHTSA, we have not performed market
research to that effect.
I will say anecdotally, living here in the District of
Columbia, I find even among my professional friends that they
may be aware of the recall. They may even be aware there is a
part available for them, but they may not realize the
seriousness.
Some of the market research shows that people do not
realize that the replacement is free or that it can be
scheduled and not take too much time.
So, I think, again, not to say consumers are the only piece
of the puzzle. Certainly, manufacturers have a role in
educating and stimulating that vehicle owners would come in for
their repairs, but that is where I say we all need to lean in,
raise awareness, and see the replacement rates improved.
Senator Moran. Ms. King, let me ask a final question, at
least in this round.
Do you believe that the prioritization under the
Coordinated Remedy is appropriate? That the way to do this is
to prioritize?
Ms. King. That is where the science and the data have taken
us. Yes.
Senator Moran. Thank you.
Senator Markey.
STATEMENT OF HON. EDWARD MARKEY,
U.S. SENATOR FROM MASSACHUSETTS
Senator Markey. Thank you, Mr. Chairman, and thank you,
Ranking Member Blumenthal, for this incredibly important
hearing.
As of the third quarter of 2017, less than one-half of the
50 million defective Takata air bags currently under recall
have been repaired. An additional 19 to 24 million additional
air bags are scheduled to be added to the recall as they reach
a state of instability. That is just unacceptable.
Simply put, we have far too many Takata air bags on the
roads years after national recalls began. For completion rates
to improve, consumers need to be aware that their car has a
dangerous, defective Takata air bag.
That is why I am concerned that NHTSA has failed to
complete a rulemaking requiring automakers to notify consumers
of recalls by way of electronic means including e-mail, social
media, or targeted online campaigns.
While I appreciate that many automakers are voluntarily
contacting consumers by way of electronic means, NHTSA must
comprehensively review how best to engage consumers
electronically and then implement standards.
Deputy Administrator King, when will that rulemaking be
completed? The law required NHTSA to complete it by August
2016. Why has it not been completed to date?
Ms. King. Senator Markey, we have proposed the rulemaking.
We are reviewing the numerous comments received on that
rulemaking.
Senator Markey. The proposed rulemaking was issued in
August 2016. It is March 2018. When are you going to complete
this rule?
Ms. King. Meanwhile, we have on our website installed a
tool that allows consumers to receive notifications, yes.
Senator Markey. Right. When are you going to complete the
rulemaking? When is the final rulemaking going to be issued?
What is your target date right now?
Ms. King. It is on a regulatory agenda as in-progress and
we look forward to having that rulemaking.
Senator Markey. What does ``in-progress'' mean? When are
you going to finish it?
Ms. King. We are reviewing comments now, Senator. I would
look forward to discussing that further with you, but we are
doing our best. As you know, it is not a simple issue. Many
people----
Senator Markey. Right.
Ms. King.--do not receive all of their e-mail. So we did
receive diverse comments on this subject matter. We take the
public comments on each and every rulemaking very seriously. We
review all of the public comments.
Senator Markey. Look, we need a standard which is set as
part of a permanent rulemaking. When are you going to finish
it?
Ms. King. We look forward to advancing the rulemaking when
we finish the comments.
Senator Markey. Are you going to finish it this year? Will
you finish it this year?
Ms. King. We prioritize reaching out to consumers, which
may or may not be the ones receiving electronic----
Senator Markey. It is unacceptable. It is just
unacceptable. Finish the rulemaking. Make it permanent. Send
clear signals. Let me go to some of the other rulemaking.
Ms. King. I hear you and I thank you.
Senator Markey. Let me go to some of the other rulemakings
here.
The tire pressure monitoring regulations, which Congress
required NHTSA to initiate by December 2016, what is the status
of that rulemaking?
Ms. King. We are making progress on that rulemaking. As I
know you are aware, we have research to complete before we
issue the rulemaking. To complete a proper and appropriate
rulemaking, we do have to do the research before proposing and
finalizing.
Senator Markey. What is your target?
Ms. King. I can send that information to you separate
from----
Senator Markey. No, you are the administrator.
Ms. King. OK.
Senator Markey. What is the target?
Ms. King. If you do not mind my taking the time from your
clock----
Senator Markey. What is the target?
Ms. King. So I have a list of rulemakings with me with the
estimated dates from the regulatory agenda. I would be happy to
send that to you separately.
Senator Markey. OK. Let me move onto the next one.
Ms. King. OK.
Senator Markey. Crash avoidance technologies on vehicle
labels, which Congress required NHTSA to implement by December
2016.
What is your target for completing that?
Ms. King. Again, I would be happy to review the regulatory
agenda or have my staff meet with your staff. As you know, we
have a number of rulemakings in progress. We are required to,
under the Administrative Procedure Act, follow procedures, take
public comment, and do adequate research before finalizing our
rulemaking.
Senator Markey. Right.
Ms. King. I appreciate your support for this.
Senator Markey. But you also have a congressional mandate
that you complete that rulemaking by the end of 2016.
Let me go to rear seatbelt reminders, which Congress
directed NHTSA to require in all new motor vehicles by October
2015. When are you going to complete that one?
Ms. King. Senator Markey, again, I would be very pleased to
work through our regulatory agenda with you. I appreciate your
support for all of the public safety regulations we are working
on.
Senator Markey. Well, I was going to go through retention
of safety records by manufacturers. That was due in June 2017.
Side impact requirements for child restraint systems were due
October 2014; that is side impact requirements for child
restraint systems.
Standards that improve the anchors and tethers needed to
secure child seats. That was due October 2015. The list goes
on, and on, and on.
The agency has to do its work. Finish these rulemakings.
Send a clear signal to the industry as to what is required.
They win. Justice delayed is justice denied. The longer this
goes on, the more endangered the public is.
I would say, as well, that one of the lessons, I think, we
learned from the death in the automated vehicle case yesterday
is that if these new technologies, Mr. Chairman, are going to
reap their purported safety efficiencies and environmental
benefits, then we have to have robust safety, cyber security,
and privacy rules that are put in place before these vehicles
are traveling the streets of our country. Otherwise, we are
going to relearn this lesson over and over again.
Thank you, Mr. Chairman.
Senator Moran. Senator Markey, thank you.
Senator Markey. Thank you.
Senator Moran. Senator Klobuchar is recognized.
STATEMENT OF HON. AMY KLOBUCHAR,
U.S. SENATOR FROM MINNESOTA
Senator Klobuchar. Thank you, Ms. King. Thank you.
We had a woman who got blinded in one eye, left permanently
blind, Ms. Shashi Chopra, a woman from North Oaks, Minnesota. A
Takata air bag exploded just right in her neighborhood. They
were not even going that quickly. Actually, it is both eyes
when I met her.
In her case, they did not even know about the issue for
about a year, and they were not notified, and it was just a
really sad story.
First of all, my first question is one of the things I got
obsessed with, when we had the ignition lock case, was that
there were all these dots across the country showing a problem,
but it was very difficult to put it all together. And that is
the ability to spot trends and problems with things like air
bags, or ignition locks and ignition keys.
NHTSA receives tens of thousands of complaints annually.
You have to try to identify these common threads.
Do you have the necessary technology to perform these
complex functions and what additional resources would help you
to do that?
Ms. King. Thank you, Senator, for asking and I am also
distressed sometimes by the complexity. NHTSA, as you know,
receives more than 6,000 vehicle safety complaints each and
every month.
I am pleased to say that as a former Risk Manager, I come
to NHTSA having seen the work to restructure the program by
which those complaints are received by NHTSA and assessed.
There are now both improvements in progress in the I.T.
system, but also a restructuring of how we process them so that
each and every complaint is screened, and there is an
assessment against the existing data bases to see whether or
not there are other issues that could be connected.
We have not only the opportunity to do that screening to
contact the manufacturers, but also to see whether or not they
have additional data. Where necessary, we launch an
investigation. We have weekly governance meetings that I
attend.
So our processes have improved greatly. That does not mean
we think we are done.
We are relaunching a group called the Safety Systems Team,
which is a group of experts in risk management processes to
assess our implementation of that restructuring and see whether
or not we are implementing as best as we possibly can, and how
can we be even better.
We are keenly aware of the risks that have been out there
and we are keenly aware of the responsibilities. We have made
progress, and will continue to always try to be better.
Senator Klobuchar. OK, thanks.
Now, this is a kind of in-the-weeds question.
Ms. King. OK.
Senator Klobuchar. Under the Consent Order, Takata was
ordered to phaseout its ammonium nitrate inflator production.
And Takata also agreed to test its desiccated ammonium nitrate
inflators, and if the company cannot demonstrate they are safe
by December 31, 2019, NHTSA can require Takata to issue
recalls.
How will NHTSA verify that the desiccated inflators are
safe?
Ms. King. It is an important question, not in the weeds at
all, I think, for those of us who work in auto safety.
There are experts, outside engineering and consulting
firms, that are doing that work. NHTSA has employed its own
expert engineering consultant to review those reports and
advise when that work is done.
We all rely on third-party experts in the subject matter so
that we can get the best possible information to make a
decision.
Ms. Klobuchar. How is NHTSA preparing to address a possible
recall of these inflators? Are you prepared for that?
Ms. King. We will be continuing to implement the
Coordinated Remedy Order which, as I mentioned earlier, as I
testified, we are seeing signs that it is working. We will
continue, however, to identify whether there are learnings we
need to incorporate.
So if there is a need to continue activities, we will learn
from our earlier recall activities.
Senator Klobuchar. The Takata recall has made clear that
NHTSA is extremely dependent on automobile companies for the
data it needs to tell whether an equipment failure is isolated,
kind of what we talked about before. While you try to put
together the dots, you also depend on this manufacturer data.
Since the recall, the Takata recall, has NHTSA made changes
to the way it handles self-reported data from manufacturers?
Ms. King. I actually do not know specifically which issues
you may be referring to there, but I will say, we depend very,
very heavily on consumer drivers, law enforcement, and others
who report directly to NHTSA at our website NHTSA.gov.
I would encourage anyone who has an issue, or a suspected
safety defect with their automobile, their truck, or their
other vehicle, or equipment, to notify us.
They can also call us at 888-327-4236. That starts the
process. We also receive, of course, early warning data. We
will ask questions of the manufacturers, but we can also compel
information.
Senator Klobuchar. Thank you.
Is there a protocol for how you initiate an investigation,
if you get a bunch of complaints, multiple complaints? How long
does it take?
That is my last question, Mr. Chairman.
Ms. King. How long it takes, going in reverse order,
depends on the complexity of the material. The protocols depend
on a risk ranking. We have a well-defined risk program. When we
narrow down what the problem is, identify frequency and
severity, we have a risk matrix that allows us to prioritize,
and decide, and move forward.
Senator Klobuchar. Thank you.
Ms. King. Thank you.
Senator Moran. Thank you, Senator Klobuchar.
Senator Cortez Masto.
STATEMENT OF HON. CATHERINE CORTEZ MASTO,
U.S. SENATOR FROM NEVADA
Senator Cortez Masto. Thank you, Mr. Chairman. I so
appreciate both you, and the Ranking Member, holding this
hearing.
Like others on this Committee, unfortunately, this is also
personal to us in Nevada, in Las Vegas. Unfortunately, an 18-
year-old by the name of Karina Dorado needed a car to get to
and from her customer service call center job.
According to her family's attorney, her father bought a
2002 Honda Accord for her in March 2016. What they did not know
was the car's history, including that it had been wrecked in
Phoenix and declared a total loss by an insurance company in
2015. Unfortunately, this automobile had the air bag inflator
from a 2001 Honda, which was covered by the recall, but was
never properly replaced. Now, Karina has a punctured trachea
and other neck injuries.
And so, like many on this Committee, I have concerns about
how fast this process is moving. What I am hearing is not quite
when it comes to recalling and making sure that individuals in
our communities, that have these vehicles, are aware that there
is a concern for their safety when they drive these vehicles.
And they are bringing them in appropriately for the recall and
the replacement.
I have a couple of questions. I understand that there are
Zones A, B, and C for the recall.
Is that correct?
Ms. King. Yes.
Senator Cortez Masto. Those Zones, can you tell me how they
are identified? Are they identified by highest risk to the
consumer? Zone A would be the highest risk, so anybody in the
states that accommodate Zone A would get a replacement before
anybody in, say, Zone B or C?
Is that correct?
Ms. King. It is, I will say, approximately correct.
The Zones, A being the one that has the greatest heat and
humidity, which combined with time creates the degradation that
results in the risk. That has been built-in to the priority
groups that are in the Coordinated Remedy Order for schedule.
So they are built-in to setting the priorities with the
ambitious goals for the manufacturers to replace all of the air
bags. Yes.
Senator Cortez Masto. And when you talk about priorities,
so I if I am in a lower priority category, and I find out I
have a vehicle that has the Takata air bag that needs to be
replaced, and I go to the manufacturer to get it replaced,
there is a potential that I cannot get it replaced because I am
not in that priority and so, I have to wait? And how long would
I have to wait?
Ms. King. One of the features of this recall is that the
risk emerges over time. So the air bags over time with exposure
to heat and humidity, the risk will emerge.
In order to focus on the highest risks first, to replace
the highest risk air bags now, those air bag that have not been
subject to the heat, humidity, and length of time are scheduled
for later replacement before the risk emerges.
Senator Cortez Masto. And I have heard that because of this
phased-in approach and the need to get, like you said, the
replacements to the most vulnerable drivers that there is a
possible limit on replacement parts. And so, there could be a
potential that when you do need that replacement part, there is
not going to be the part available.
Is that true? That if you are lower down on the phased-in
approach and you are not a high risk, that those parts are not
available for you?
Ms. King. When a consumer is contacted about their
replacement parts, they are being invited in to have their
replacement air bag installed, that part should be available.
If any of your constituents, any friends and neighbors say that
is not the case, they should contact us. They should contact
the manufacturer.
The manufacturers are making available parts that are
adequate for each recalled group.
Senator Cortez Masto. And so, let me ask you this. If I
have a 16-year-old daughter who actually has one of these
vehicles, but she is in Zone C, she is going to have to wait to
get a replacement part? And we are just going to assume that
the science is there that there is no concerns to her safety
based on what you have identified as Zones A, B, and C and her
priority?
Ms. King. So, again, the risk emerges with time,
temperature, heat, and humidity. So there may be, in fact, some
inflators that are planned to be scheduled for replacement in
later periods in time. In fact, we expect to expand.
We have scheduled expansion of the recall to include 20
million more in order to pull from the marketplace, to pull
from vehicles those air bags with the inflators that are
expected to degrade over time.
Senator Cortez Masto. And I appreciate that. I am running
out of time here, but I have concerns about anybody who has a
child or anybody who is driving these vehicles and they cannot
get a replacement immediately.
I mean, you are already talking about the fact that we
cannot even identify people to make sure that they come in and
get the recalls. Now, maybe somebody is identified, but now you
are going to tell them that, ``You have to wait.'' I think that
is ridiculous, number one.
Number two, the challenge I do hear from you is identifying
these vehicles. Right? And getting the information to the
drivers of those vehicles so that they are aware that there is
a danger and they have to get a recall.
Is that what I am hearing is happening right now?
Ms. King. The vehicles are identified, but not all of the
owners have understood that there is a free replacement
available, and that it is urgent, and they should go ahead and
take action on the recall notice when they receive it.
In addition, there may be some confusion, things like the
class action lawsuit would send out mailers. People think that
they need to go to the dealership now.
I will say, when a consumer is contacted, invited to come
in and replace their air bag, they should do so as quickly as
possible. Not everyone understands the risks and they do not
always take action as quickly as they should. But the vehicles
are identified.
Senator Cortez Masto. Thank you. I know my time is running
out and I will just submit the rest of my questions for the
record for Ms. King.
Thank you.
Senator Moran. Thank you for your cooperation.
Senator Hassan.
STATEMENT OF HON. MAGGIE HASSAN,
U.S. SENATOR FROM NEW HAMPSHIRE
Senator Hassan. Thank you very much, Mr. Chair.
And welcome, Ms. King. It is good to see you.
As I know you have been discussing, and as I know you are
aware, this recall represents one of the largest and most
complicated in the history of the United States.
People in my State of New Hampshire are concerned that
information about the latest recalls and safety guidelines
could be more easily accessible.
The information needs to be provided in a clear and
understandable format so that consumers can be empowered to
respond appropriately.
How does NHTSA work to pass information to states and local
governments to ensure that states and localities have the
resources and latest information to help keep them informed?
Ms. King. Thank you for your question, Senator.
First of all, it is important to recognize that the first
responsibility for informing consumers and implementing the
recall is with the auto manufacturers, and they are trying many
innovative and novel ways to do so. We all would look forward
to hearing from you on how best to reach your constituents.
Second, at NHTSA, in our efforts to raise consumer
awareness, we are developing programs in Departments of Motor
Vehicles. I have done a radio tour. I do not recall whether or
not your state was part of the national radio tour.
We are very much open to ideas on how to reach people. So
we would look forward to hearing form you. You know your
constituents better than we do and we would love to learn how
to help.
Senator Hassan. Well, I would appreciate that partnership
and look forward to talking with you about it. That kind of
brings me to my second question.
Because I represent New Hampshire, obviously a northern
state, a colder state, right now under a whole lot of snow. And
it is my understanding that the recall prioritizes vehicles in
warmer and more humid states as the high priorities, while
vehicle located in colder states are lower ones simply because
of what triggers the air bags to explode.
So the problem with the approach or prioritizing warmer
states over colder states is that cars move and they change
location. And as they change location, the temperatures that
they are in change, and that may put drivers at-risk.
Many people in my state of New Hampshire spend their
winters down in Florida or other warmer climates, and they
drive their cars down there, and they spend several months in
the warmer climate, and then they come back home.
So what is being done to raise awareness to consumers that
their vehicle may need attention a lot sooner than they
initially thought?
Does NHTSA maintain a database of how many recalls are
needed in each state?
Ms. King. Thank you very much for asking that question. It
is an important one.
First, I would like to say the priority groups and the
assignment of individual vehicles to priority groups takes into
account whether a vehicle was ever registered in a warmer
state.
Senator Hassan. OK.
Ms. King. So a vehicle that maybe at some point was
registered in Florida would be recognized as a vehicle from a
warmer and more humid place.
Senator Hassan. But vehicles, the inverse vehicles that are
registered in New Hampshire, but driven down to Florida, unless
we do a lot of work even in outreach, for instance, to say,
``Are you a snowbird?'' which a good way to get peoples'
attention might be helpful.
Ms. King. That is right. We have not identified that the
risk is elevated quickly. If there is intermittent or periodic
exposure to temperatures, it is with the long exposure across
time to high humidity, and heat, and temperature cycling.
Senator Hassan. OK.
Ms. King. So I will say that the snowbird phenomenon, there
is not evidence suggesting that that would be a higher priority
group. But that being said, a consumer can and should contact
their dealership; they may have replacement parts. There may be
parts available even though they are not scheduled yet.
Senator Hassan. OK.
Ms. King. So I would encourage them to work with their
dealership and their manufacturer.
Senator Hassan. Well, thank you. That is very helpful. I
will look forward to working with you on that.
We had other questions for the other panelists earlier that
we will submit for the record.
Thank you very much, Mr. Chair.
Ms. King. Thank you.
Senator Moran. Ms. King, I always give the witnesses an
opportunity to tell us anything that they would like to add. We
are going to conclude this panel and dismiss you, and we will
have a second panel momentarily.
But is there anything you want to make sure that is put in
the record that you were unable to have the opportunity to say?
Ms. King. Only that I thank each of the Senators very much
for the support on this issue. It is very important. We have
more challenges ahead as we improve response rates, consumer
awareness is key, continued vigilance is key. And I look
forward to working with you.
Thank you.
Senator Blumenthal. Mr. Chairman.
Senator Moran. Senator Blumenthal.
Senator Blumenthal. I am going to send some questions to
you in writing, since we have a deadline of 4:15 for a vote.
Ms. King. Thank you.
Senator Blumenthal. I am not going to take the time now to
ask for a second round. I also have a letter from Safety
Advocates, which I would ask be put in the hearing record.
Senator Moran. Without objection.
[The information referred to follows:]
March 19, 2018
Hon. John Thune, Chairman,
Hon. Bill Nelson, Ranking Member,
Committee on Commerce, Science, and Transportation,
United States Senate,
Washington, DC.
Hon. Jerry Moran, Chairman,
Hon. Richard Blumenthal, Ranking Member,
Subcommittee on Consumer Protection, Product Safety, Insurance, and
Data Security,
United States Senate,
Washington, DC.
Dear Chairman Thune, Ranking Member Nelson, Chairman Moran and Ranking
Member Blumenthal:
We are writing to convey our support and gratitude for your
leadership in convening tomorrow's hearing, ``Update on NHTSA and
Automaker Efforts to Repair Defective Takata Air Bag Inflators.'' The
growing death toll on our Nation's highways and the record number of
vehicle recalls due to serious safety defects combined with lackluster
agency oversight and insufficient industry responses deserve the
attention and focus this hearing will provide. As you continue to
examine safety problems and remedial actions related to defective
Takata airbags, we urge you to also recognize that consumers will
likely be victims once again of industry misconduct and government
missteps with the mass deployment of experimental autonomous vehicles
(AVs) unless Congress acts. The unfortunate news that a pedestrian was
killed late Sunday in a crash with an Uber being driven in autonomous
mode should serve as a startling reminder that there are real world
consequences to prematurely deploying AV technology. We urge you to
take heed of this fatal incident during tomorrow's hearing and request
that you delay consideration of the AV START Act (S. 1885) until the
National Transportation Safety Board (NTSB) has completed its
investigations of this recent Uber crash in Tempe, AZ that killed a
pedestrian as well as the California crash involving a Tesla and a
parked fire truck this past January. The NTSB may have findings and
recommendations that should be incorporated into the legislation in
addition to our proposals for legislative improvements. We respectfully
ask that this letter be submitted into the hearing record.
In 2016, approximately 925 recalls involving more than 53 million
vehicles were issued--the largest number in history. This includes
deadly defects such as exploding Takata airbags, which have killed at
least 20 people worldwide and faulty General Motor (GM) ignition
switches that have claimed the lives of over 120 more victims.
Unfortunately, these are not the only high profile examples of serious
problems and cover-ups. Yet, the National Highway Traffic Safety
Administration (NHTSA) still lacks crucial authorities and resources to
serve as an effective ``cop on the beat.'' Furthermore, NHTSA's budget
is woefully underfunded and the agency is in desperate need of both a
more robust budget and staff. The agency should be provided with
imminent hazard authority to immediately intervene against widespread
safety defects. The agency should also be given enhanced penalty
authority including removing the cap on civil penalties and adding
criminal penalties to ensure manufacturers do not willfully put
defective cars into the marketplace. Additionally, there is no
requirement that used cars under open recall for a defect be remedied
before being sold. With 38.5 million used cars sold in 2016, this is a
huge and terrifying loophole that should be closed similar to
congressional action related to rental cars.
We should not allow history to repeat itself especially one replete
with industry malfeasance affecting millions of consumers and
needlessly causing deaths and injuries. Now the same industry is asking
the public and the government to ``trust them'' as they develop and
deploy new driverless car technology. Alarmingly, the U.S. Department
of Transportation (U.S. DOT) has been complicit in this approach. By
issuing only ``voluntary guidelines,'' which are grossly inadequate and
lack any sort of enforcement mechanism, the U.S. DOT has shirked its
safety mission and regulatory duty. The stage is now set for what will
essentially be beta-testing on public roads with families as unwitting
crash test dummies.
It is for these reasons that it is critically important that
improvements be made to the AV START Act. While some changes were made
during the Committee markup, the bill still lacks essential safeguards
that will assure sufficient government oversight, industry
accountability and public safety. This legislation will set AV policy
for decades to come. As such, it is imperative that strong protections
for consumers and the public be included. We strongly urge the
Committee to make the following modifications to the bill.
The size and scope of exemptions from Federal safety standards must
be narrowed. The AV START Act would allow for potentially millions of
unproven AVs to be exempt from current Federal motor vehicle safety
standards (FMVSS) and sold to the public. The number of AVs that will
be permitted to be exempt from FMVSS should be reduced and the time
period between exemption ``tiers'' should be extended from 12 to 24
months to allow for adequate time to assess the real-world impact on
the road safety performance of exempt vehicles. Further, any exemption
from FMVSS that would diminish the current level of occupant protection
should be prohibited. Moreover, the AV START Act would allow
manufacturers to circumvent the exemption process and ``turn off''
vehicle systems such as the steering wheel and brakes without review
and approval by NHTSA. This provision gives unfettered discretion to
the industry to unilaterally make safety systems inoperable and should
be eliminated.
Minimum performance requirements must be set to address critical
issues with AVs. Significant safety vulnerabilities need to be
addressed through basic safety rules, and the AV START Act should
direct NHTSA to issue the following standards.
Cybersecurity: Given the recent record of high-profile
cyberattacks, protections must be put in place to curb
potentially catastrophic hacks of AVs. A plan, as currently
required by the bill, is insufficient and should be replaced
with a directed rulemaking to be completed within three years.
Electronics: Motor vehicles and motor vehicle equipment are
powered and run by highly complex electronic systems and will
become even more so with the introduction of autonomous driving
systems. As the Federal Aviation Administration (FAA) has
carried out for aircraft, NHTSA must require minimum
electronics standards for all cars. This will be essential to
ensure that the electronics that power and operate safety and
autonomous driving systems function properly.
Driver Distraction and Engagement: In Level 2 and Level 3
vehicles that require a human to take control back from the AV
system, the driver must be kept engaged. This need was
underscored by the NTSB investigation into the fatal 2016 crash
of a Tesla Model S, which found that the Autopilot system
facilitated the driver's inattention and overreliance on the
system. NHTSA must be directed to establish a minimum
performance standard to address this problem.
Vision Test: AVs will need to be able to properly detect and
respond to other vehicles, roadway infrastructure, pedestrians,
bicyclists, law enforcement, and other common encounters during
any given trip. NHTSA should require that AVs pass a ``vision
test'' to guarantee that it can sufficiently ``see'' and react
to its surroundings.
Consumers need basic safety information about AVs. As driverless
cars are sold to the public, it is necessary that consumers know what
they can, and cannot, do. Further, consumers must know from which
vehicle safety standards their vehicle may be exempt. While the bill
includes a rulemaking for consumer information at the point of sale and
in the owner's manual, the final rule may not be issued for years.
Consumers should immediately have access to basic safety information.
Additionally, Level 2 vehicles must be included in the consumer
information and safety evaluation report (SER) provisions, and the SERs
should require documentation of manufacturers' assertions, not just
descriptions, to ensure that NHTSA has enough information to accurately
assess the technology. NHTSA should also be directed to establish a
website that the public can use to find out safety information about
AVs. And, all crashes involving an AV should be reported to NHTSA and
that data should be made publicly available.
The varying needs of disabilities communities must be addressed.
Though AVs are often touted as a panacea for mobility issues facing
disability communities, they are certainly not a one-size fits all
solution. Specifically, there is nothing in the AV START Act that would
remove barriers to wheelchair users such as cost or vehicle design. The
way that most vehicles are currently designed do not allow for the
integration of a ramp or lift system or for a wheelchair to be properly
or safely stored. Simply removing a driver or installing an automated
system will not overcome these factors that inhibit mobility. Moreover,
in the event of a crash or malfunction, people with certain
disabilities may be particularly vulnerable.
States should not be preempted from acting to protect their
citizens. The bill would preclude states from undertaking regulatory
action even though the Federal Government has not yet done so. This is
an unprecedented approach to preemption that should be rejected. Until
U.S. DOT issues standards and regulations, states must retain their
traditional legal authority to maintain public safety.
Compared to the complex systems that will be used in driverless
cars, an airbag inflator is a relatively simple technology. As the
Committee focuses on the deadly consequences of the failure of just one
vehicle component, we urge you to make significant changes to the AV
START Act to protect public safety. This Committee has already held
five hearings on vehicle defects in the past four years that have
revealed critical information about numerous NHTSA mistakes, repeated
industry wrongdoing and the unacceptable but frequent breach of public
trust.
We urge you to act to ensure that future tragedies like exploding
Takata airbags are not repeated with the development and deployment of
technology that is still in its infancy. Unfortunately the mistakes of
recent history are all too fresh and should not be pushed aside in an
inappropriate rush to limit NHTSA's authority to oversee the safety of
autonomous vehicles.
Sincerely,
Jeff Solheim, 2018 President
Emergency Nurses Association
Bill Newton, Deputy Director
Florida Consumer Action Network
Melissa Wandall, President
National Coalition for Safer Roads
Founder, The Mark Wandall Foundation
Ralf Hotchkiss, Co-Founder
Whirlwind Wheelchair International
Leah Shahum, Founder and Director
Vision Zero Network
Paul Schrader, Treasurer
Massachusetts Consumers Council
Paul Steely White, Executive Director
Transportation Alternatives
Brent Hugh, Executive Director
Missouri Bicycle & Pedestrian Federation
Catherine Chase, President
Advocates for Highway and Auto Safety
Joan Claybrook, President Emeritus
Public Citizen, and Former NHTSA Administrator
Jack Gillis, Director of Public Affairs
Consumer Federation of America
Robert Weissman, President
Public Citizen
Rosemary Shahan, President
Consumers for Auto Reliability and Safety
Andrew McGuire, Executive Director
Trauma Foundation
Stephen W. Hargarten, M.D., MPH
Society for the Advancement of Violence and Injury Research
Jason Levine, Executive Director
Center for Auto Safety
John M. Simpson, Privacy and Technology
Project Director, Consumer Watchdog
Dawn King, President
Truck Safety Coalition
cc: Members of the U.S. Senate Committee on Commerce, Science, and
Transportation
Senator Blumenthal. Thank you.
Thanks very much.
Ms. King. Thank you.
Senator Moran. Thank you.
We will call our second panel. We welcome them to the
table.
This panel includes Mr. John Buretta, who is the
Independent Monitor for Takata and the Coordinated Remedy
Program; Mr. David Kelly, the Project Director for Independent
Testing Coalition; Mr. Joe Perkins, Senior Vice President and
Chief Financial Officer of Key Safety Systems; Mr. Rick
Schostek, Executive Vice President of Honda North America; and
Ms. Desi Ujkashevic, Global Director of Automotive Safety
Office for Ford Motor Company.
Gentlemen and ma'am, welcome. We will start with you, Mr.
Buretta and have 5 minute opening statements.
STATEMENT OF JOHN D. BURETTA,
INDEPENDENT MONITOR, TK HOLDINGS, INC.
AND THE COORDINATED REMEDY PROGRAM
Mr. Buretta. Thank you, Chairman Moran, Ranking Member
Blumenthal and the other members of the Subcommittee.
I really appreciate the opportunity to testify about this
important issue.
As has been noted, the Takata air bag inflator recall is
the largest, most complex in U.S. history. Our current count is
about 50 million inflators to be repaired; 37 million vehicles;
200 makes and models across 19 automakers. Most of these
vehicles are older vehicles; about 75 percent of the vehicles
are more than 10 years old.
And to date, tragically as has been noted, there are at
least 15 confirmed deaths in the U.S., more than in any other
country. Those confirmed fatalities have occurred in nine
states. In many additional cases, including in many additional
states, there have been numerous injuries and permanent
disfigurement.
In the past, many affected vehicle manufacturers were slow
to innovate and think strategically about how to maximize these
recall repairs.
Further, many automakers relied on boilerplate, exclusively
English language letters to consumers. Those letters did not,
in the past, always clearly convey the problem or the steps
that owners should take.
As part of my mandate to monitor these recalls, I have
pursued, together with NHTSA and with the auto-manufacturing
community and other stakeholders, numerous activities to drive
innovation and intensify focus on effective methods of driver
engagement. These activities aim to improve outreach to
consumers and get these vehicles repaired despite the numerous
challenges.
I have made multiple recommendations about successful
means, messaging, and motivation to improve repair rates. Some
of these recommendations include: clear, simple messaging for
consumers emphasizing that the repair is free; improving the
quality of owner contact information to make sure manufacturers
are efficiently and cost effectively contacting the right
people; frequent outreach to owners to convey urgency;
minimizing the inconvenience to owners by offering free towing,
loaner vehicles, and extended service hours; working with
independent repair facilities to notify their customers; and
intensifying and incentivizing dealer engagement.
Working together with NHTSA and all affected automakers, we
are also pursuing industry-wide and industry-driven solutions.
These efforts include a new and innovative batch look-up
tool, which will enable auction houses, used car dealers,
salvage yards, and insurers to check in one fell swoop a large
number of VINs so that they know which vehicles have open
recalls.
I am proud to report that as more and more automakers have
adopted recommendations, dedicated more resources, and worked
together as an industry with NHTSA and myself, there has been
marked improvement.
Recently launched priority group campaigns have achieved,
in just two quarters, what had previously taken five; and some
of the repair rates have doubled or even tripled over the last
year.
Our efforts have also focused even more intensively on the
highest risk ``Do Not Drive'' vehicles.
Last year, I launched an unprecedented door-to-door
canvassing effort for the Honda Alpha ``Do Not Drive''
vehicles. Teams of canvassers literally went door to door to
thousands of owners to advise them of the problem and to
schedule a repair right at the owner's door.
Following the success of that pilot, we were very happy to
see Honda adopt canvassing nationwide for all unrepaired ``Do
Not Drive'' alpha vehicles.
In February of this year, 2018, we launched yet another
pilot of door-to-door canvassing with three additional
automakers: Ford, Fiat Chrysler, and Mazda. This pilot is new
and in its infancy, but it is already seeing success with
already several hundred repairs scheduled by that knock on the
door.
This new canvassing effort also involves innovative mobile
repair with vehicle manufacturers doing the repairs right at
the vehicle owner's doorstep.
We have also worked with State DMVs, police departments,
and local community groups to provide a clear and urgent
message about these highly dangerous vehicles.
But there is still plenty of room for improvement; uneven
performance and much work to be done.
I am grateful for the opportunity to work with this
Subcommittee on further progress, hope you will not hesitate to
call on me if I can be helpful and I look forward to answering
any questions you may have.
Thank you again for the opportunity to testify this
afternoon.
[The prepared statement of Mr. Buretta follows:]
Prepared Statement John D. Buretta, Independent Monitor,
TK Holdings, Inc. and the Coordinated Remedy Program
Good afternoon, Chairman Thune, Chairman Moran, Ranking Member
Nelson, Ranking Member Blumenthal and members of the subcommittee.
Thank you for the opportunity to testify before you today on this
important issue.
The Takata airbag inflator recalls are the largest and most complex
vehicle recalls in United States history. There are currently 19
affected vehicle manufacturers, with an estimated 50 million unrepaired
defective airbag inflators under recall in approximately 37 million
U.S. vehicles.
The words ``grenade'' and ``ticking time bomb'' accurately convey
the lethal potential of these defective inflators. To date, at least 15
people in the United States have been killed by defective Takata airbag
inflators--more confirmed fatalities than in any other country. In
these fatalities, the Takata airbag inflator, instead of properly
inflating to cushion the victim and prevent injury, detonated in an
explosion that tore apart its steel inflator housing and sprayed metal
shards at high velocity toward the victim. The victims have died from
blunt head trauma, severance of the spine at the neck or extreme blood
loss from lacerations to the chest, neck or face. The confirmed
fatalities have occurred in nine states: California, Florida,
Louisiana, Oklahoma, Pennsylvania, South Carolina, Texas, Virginia and
West Virginia. In many additional cases, including in many additional
states, surviving victims of Takata inflator explosions have been
permanently disabled or disfigured.
These are urgent safety recalls, and the combination of over a
dozen affected vehicle manufacturers, tens of millions of affected
vehicles and risk of potential death or serious injury is
unprecedented. As the largest and most wide-reaching set of vehicle
recalls in U.S. history, the Takata airbag inflator recalls require
vehicle manufacturers to dedicate substantial resources, implement
recall initiatives on a significant scale, and think strategically and
innovatively to maximize repairs.
One particular challenge is that most affected vehicles are older
models. Over 97 percent of the vehicles presently under recall are over
five years old and nearly 75 percent of the vehicles are more than ten
years old. Older vehicles change hands more through private sales and
auctions. Older vehicles' owners are less likely to have a relationship
with a local dealer and more likely to use an independent repair
facility for maintenance and repairs. Identifying the correct contact
information for current owners of these older vehicles also takes
greater effort.
As part of my mandate to oversee, monitor, and assess compliance
with the Coordinated Remedy Program, I have pursued a wide range of
activities to drive innovation and intensity of focus to get these
vehicles repaired despite the challenges posed. That work has included
research to identify messaging that clearly communicates the defect's
risk to consumers and motivates them to act, engaging the various
stakeholders in these recalls, piloting initiatives to equip vehicle
manufacturers with additional tools to execute the recalls with greater
success, constantly monitoring progress, and making comprehensive
recommendations to provide a recipe for success. The recommendations
address in detail specific topics critical to the efficacy of the
Takata recalls, including: (1) improving consumer outreach, (2)
engaging dealerships, (3) engaging other third parties such as
independent repair facilities and outreach vendors and (4) employing
salvage recovery services to retrieve scrapped or salvaged inflators.
Summaries of recommendations and observations for success are set out
at Figures 29 and 55, respectively, of The State of the Takata Airbag
Recalls report issued this past November, which treats this subject in
greater detail.
Data and experience in these recalls confirms that vehicle
manufacturers have greater success when they send frequent outreach in
a variety of mediums, including not only mail but also e-mail,
telephone, text message and social media, and that repeated reminders
are crucial to convey the urgency of the safety risk. The most
effective outreach is personalized to the owner and vehicle type, and
provides a clear, simple and actionable message, including emphasizing
that the repair is free.
For the very highest risk Do-Not-Drive vehicles, outreach efforts
have been taken to new levels, including an unprecedented door-to-door
canvassing effort, with teams of canvassers literally knocking on the
front doors of vehicle owners' homes. The first canvassing pilot
involved Honda's Do-Not-Drive ``Alpha'' vehicles and has been a great
success. When a canvasser spoke with an individual at the door who was
able to schedule an appointment for a repair, an appointment was
scheduled more than 80 percent of the time. Knocking on doors has also
provided invaluable information about the vehicle's current location,
such as whether the vehicle has been sold and is no longer at that
address. Honda has adopted canvassing nationwide for all unrepaired
high-risk vehicles. Additional vehicle manufacturers, including Ford,
Fiat Chrysler and Mazda, are now piloting door-to-door canvassing and
already seeing success.
Innovative ways for vehicle owners to more easily determine whether
their vehicle is subject to any recall, including the Takata recalls,
have also been developed, including the launch of the
``AirbagRecall.com'' website, which provides easy-to-understand
information about the Takata recalls, allows vehicle owners to check
whether they have an open Takata recall by simply entering their
license plate or VIN on the website and provides a phone number and a
click-to-call option to a local dealer to immediately schedule a
repair. AirbagRecall.com represents the first time license plates have
been used to directly check on a vehicle's open recalls. A mobile app
has also been launched, with the capability to scan a license plate for
open recalls by simply pointing a smartphone camera at the plate.
In partnership with NHTSA and all 19 affected vehicle
manufacturers, four Takata Recalls summits have been hosted to provide
a forum for affected vehicle manufacturers to share best practices in
recall completion and develop industry-wide strategies. These summits
include presentations by the affected vehicle manufacturers on key
topics including coordinated communications, innovative outreach
strategies and engaging key third parties in the recall process.
Working groups comprised of numerous automakers facing similar
challenges convene regularly to continue to refine strategies and
improve coordination to increase recall repairs.
In the past, many affected vehicle manufacturers were slow to
engage meaningfully and think strategically about how to maximize
recall repairs and to deploy the kind of innovative recall techniques
needed for the Takata recalls. More recently, there has been marked
improvement, and the recall completion percentages are beginning to
reflect this effort. Affected vehicle manufacturers are more readily
exploring multi-touch, layered communications, mobile repair,
engagement with independent repair facilities and door-to-door
canvassing in order to remove defective inflators from U.S. roadways.
Recent campaigns have achieved in just two quarters what previously
took more than five, doubling and even tripling the rate of repairs.
Vehicle manufacturers using frequent, multi-channel outreach have seen
completion percentages nearly twice as high as rates for vehicle
manufacturers using traditional letter outreach, when targeting
similarly situated vehicles over the same period of time. More
intensive dealer engagement is also yielding real improvements in
repair rates.
But there is still plenty of room for improvement, much work to be
done, greater coordination to achieve, further resources to be deployed
and more scale to be brought to initiatives that data and experience
demonstrate make a real difference. I look forward to continuing to
work with this Committee to identify additional ways to accelerate
progress in combating this deadly safety issue.
Chairman Thune, Chairman Moran, Ranking Member Nelson, Ranking
Member Blumenthal and members of the subcommittee, thank you again for
the opportunity to testify today, and for your continued focus on this
critical matter of consumer protection.
Senator Moran. Thank you, very much, Mr. Buretta.
Now, Mr. Kelly.
STATEMENT OF DAVID KELLY, PROJECT DIRECTOR, INDEPENDENT TESTING
COALITION
Mr. Kelly. Good afternoon, Mr. Chairman, Ranking Member
Blumenthal, members of the Subcommittee.
Thank you for the invitation to appear before the Committee
to discuss the activities of the Independent Testing Coalition.
The ITC is comprised of the ten automakers affected by the
original NHTSA recall, and is committed to conducting an
independent and comprehensive investigation of the technical
issues associated with Takata air bag inflators.
We look forward to the results of this process as we focus
on ensuring the safety, security, and peace of mind of all
affected motorists.
ITC members support a scientific engineering analysis, and
we will not prejudge this process or any of the outcomes.
The Coalition began our work a little more than three years
ago and the work was designed in two separate tasks.
First, we set out to find the root cause of the problem. In
March 2016, we delivered those results to NHTSA, Takata,
Congress, and the media. The ITC was the first entity to
deliver a definitive root cause, requiring all three of the
following factors:
First, the presence of pressed phase-stabilized ammonium
nitrate propellant without moisture absorbing desiccant;
Second, long term exposure to repeated high temperature
cycling in the presence of moisture;
And finally, an inflator assembly that does not adequately
prevent moisture intrusion in high humidity.
The second phase of the project has been dedicated to
developing a predictive aging model for certain, desiccated
inflators. This part of the project has been ongoing since
2016, and we expect to be able to release our findings soon.
We believe the testing that we are conducting is the most
expansive, independent testing to date on desiccated inflators.
When we are finished, we will have completed 10,000 tests on
more than 1,500 inflators. Engineers at Orbital ATK, our
engineering firm, will have completed more than 60,000 hours
when this project is concluded.
These inflators come from five different design types, with
multiple variants within those inflator types. Our tests have
included aging tests, dissection and disassembly, Computed
Tomography scanning, and propellant testing.
A couple of points; I think it is important to make several
points about what folks should expect in our final report.
First, we will not be making a definitive statement
regarding the safety of desiccated inflators. That was never
the goal or intent of this phase of the project or of the ITC.
What we will do is provide all of our data to automakers, and
OEMs, and regulators to allow them to make the proper policy
decisions.
Second, since we will be producing a predictive aging
model, we are also not going to be making any additional
statements about the safety of any particular inflator.
Finally, I want to assure everyone here that we will be
publishing all of our test results and data in a final report
that will be released to the public. This has been a promise of
the ITC from the beginning, and we will follow through on that
promise.
I look forward to answering any of your questions.
[The prepared statement of Mr. Kelly follows:]
Prepared Statement of David Kelly, Project Director,
Independent Testing Coalition
Thank you for the invitation to appear before the committee to
discuss the activities of the Independent Testing Coalition (ITC). The
ITC is comprised of the 10 automakers affected by the original NHTSA
recall--BMW, FCA U.S. f/k/a Chrysler Group, Honda, Ford, General
Motors, Mitsubishi, Mazda, Nissan, Subaru and Toyota. The ITC is
committed to conducting an independent and comprehensive investigation
of the technical issues associated with Takata airbag inflators. We
look forward to the results of this process as we focus on ensuring the
safety, security and peace of mind of all affected motorists. ITC
members support a scientific, engineering analysis, and will not pre-
judge the process or its outcomes.
This coalition began work a little more than three years ago. The
work was designed in two separate tasks. First, we set out to find the
root cause of the problem. In March 2016, we delivered those results to
NHTSA, Takata, Congress and the media. The ITC was the first entity to
deliver a definitive root cause, requiring all 3 of the following
factors:
The presence of pressed phase stabilized ammonium nitrate
propellant without moisture-absorbing desiccant,
Long term exposure to repeated high temperature cycling in
the presence of moisture, and
An inflator assembly that does not adequately prevent
moisture intrusion in high humidity.
The second phase of the project has been dedicated into developing
a predictive aging model for certain, desiccated inflators. This part
of the project has been ongoing since 2016 and we expect to be able to
release those findings soon.
We believe the testing we are conducting is the most expansive
independent testing to date on desiccated inflators. We will have
completed 10,000 tests on more than 1,500 inflators. Orbital ATK
engineers will complete more than 60,000 hours when the project
concludes. These inflators come from five different design types, with
multiple variants within those inflator types. Our tests have included
aging tests, dissection and disassembly, computed tomography (CT)
scanning and propellant testing. We will continue to share relevant
data with NHTSA and Takata as our testing progresses. During this phase
of the project, we have already met with NHTSA, Takata and Congress as
we had information to report. Because of the nature of the testing, we
do not always have a steady stream of data to report.
I think it is important to make several points about what to expect
in our final report. First, we will not be making a definitive
statement regarding the safety of desiccated inflators. That was never
the goal or intent of the ITC. What we will do is provide all of our
data to decision makers and allow them to make the proper policy
decisions.
Second, since we will be producing a predictive aging model, we
will not be making any additional statements about the safety of any
particular inflator.
Finally, I want to assure everyone that we will be publishing our
test results and data in a final report that will be released to the
public. This has been a promise of the ITC from the beginning and we
will follow through on that promise.
Thank you.
Senator Moran. Thank you very much.
Now, Mr. Perkins.
STATEMENT OF JOSEPH PERKINS, SENIOR VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER, KEY SAFETY SYSTEMS, INC.
Mr. Perkins. Mr. Chairman, Mr. Ranking Member, members of
the Committee.
Good afternoon. My name is Joe Perkins. I am Senior Vice
President and Chief Financial Officer for Key Safety Systems, a
100-year-old safety company headquartered in the great State of
Michigan. Our company, Key Safety, as our name emphasizes,
manufactures and sells safety-critical automotive components to
vehicle manufacturers worldwide.
It is an honor to be here today and I am very pleased to be
a part of the solution to this crisis.
Thank you for the opportunity to appear today to tell you
about Key Safety's efforts to acquire most of the operating
business of Takata. This transaction enables us to expand our
investment in our core business and, importantly, contribute to
the supply of critical safety components for new vehicle
production, and recall, and replacement parts.
I was born and raised in Michigan. I have worked in the
U.S. auto industry my entire career, nearly 30 years. Two years
ago, I was asked to lead an effort by Key Safety to purchase
most of Takata's assets through a very complex series of
transactions.
Beyond being a good business decision, Key Safety pursued
the deal in an effort to stabilize the industry by providing a
reliable, ongoing supply of safety parts and recall kits. This
transaction also facilitates providing recovery to victims, and
very importantly, saving American jobs.
In my role, I became one of Key Safety's lead negotiators
in our effort to purchase Takata and to address the issues of
all key stakeholders.
At the beginning of the transaction process in July 2016,
Key Safety competed with a number of bidders to purchase
Takata's assets. After a lengthy and competitive process, Key
Safety was ultimately selected as the best fit for the job,
having earned the support of nearly all of the worldwide
automotive manufacturers.
After months of review, the OEMs, Takata, and a steering
committee nominated by Takata selected Key Safety as the chosen
purchaser.
I am happy to report to this Committee that, last month,
the U.S. Bankruptcy Court in Delaware entered a confirmation
order granting approval of the transaction. The bankruptcy
proceedings in Canada and Japan have also been addressed.
Beyond the approval of these courts, the Key Safety-Takata
transaction requires review from several other government
bodies, and satisfaction of very important remaining key
conditions to close that we continue to focus on diligently.
First, the U.S. Department of Justice has a Plea Agreement,
as you know, with Takata and we needed to work out go forward
terms with the DOJ. We did so, and I am happy to report that
the $850 million penalty owed by Takata to DOJ will be paid
upon closing of this transaction.
Second, NHTSA has a Consent Order, again, as you know, over
Takata, and we needed to work with NHTSA on several issues
related to the transaction. We have done so, thanks in large
measure to NHTSA Deputy Administrator Heidi King and her team.
And thanks again to Heidi.
Third, because Key Safety is ultimately foreign-owned, the
parties submitted a joint voluntary notice to the Committee on
Foreign Investment in the United States, CFIUS. Clearance by
that Committee is a condition to closing of this transaction. I
can report that Takata and Key Safety are working closely with
CFIUS, and we are hopeful that it will clear the transaction,
which will enable us to close sometime in April of this year.
The purchase of most of Takata by Key Safety goes toward
addressing the Takata air bag crisis head on. As part of the
transaction, certain parts of existing Takata and certain newly
created entities, which we refer to as ``Reorganized Takata,''
will emerge from the Takata bankruptcy to continue to address
any remaining PSAN air bag issues. We will not buy that piece
of the business.
Key Safety will produce critical air bag modules and recall
kits. Some of these air bags will use PSAN inflators made by
Reorganized Takata. Others will use other inflators. These
outputs will enable the OEMs to fulfill the pending Takata air
bag recalls and continue their global production.
The deal is also anticipated to provide more than $130
million to Takata victims, which is in addition to the $125
million paid as part of the DOJ Plea Agreement. This was a key
foundation of our deal. Absent this deal, these funds would not
be available to the victims.
For me, as a proud Michigander who has spent his entire
life in the U.S. auto industry, my dad worked there as well,
this transaction has become very personal.
This is also reaching for a day when the air bag crisis is
fully resolved and when this transaction provides full
stability to the industry. This transaction will resolve a
critical issue in the industry and facilitate the continuity of
supply needed to maintain stability in our industry, which is
critical to the backbone of this country.
We at Key Safety are happy to play a role in this solution.
We are a problem solver, and we are working to achieve this
result.
I want to thank the Committee for inviting me to speak
today. It was an honor.
And I am happy to answer any questions.
Thank you.
[The prepared statement of Mr. Perkins follows:]
Prepared Statement of Joseph Perkins, Senior Vice President
and Chief Financial Officer, Key Safety Systems, Inc.
Mr. Chairman, Mr. Ranking Member, members of the Committee, good
afternoon. My name is Joe Perkins. I am Senior Vice President and Chief
Financial Officer for Key Safety Systems, a 100 year-old safety company
headquartered in Michigan. Our company, Key Safety, as our name
emphasizes, manufactures and sells safety-critical automotive
components to vehicle manufacturers worldwide.
Thank you for the opportunity to appear today to tell you about Key
Safety's efforts to acquire most of the operating business of Takata.
This transaction enables us to expand our investment in our core
business and contribute to the supply of critical safety components for
new vehicle production and recall kits.
I was born and raised in Michigan and have worked in the U.S. auto
industry for nearly 30 years.
Two years ago, I was asked to lead an effort by Key Safety to
purchase most of Takata's assets through a complex series of
transactions. Beyond being a good business decision, Key Safety pursued
the deal in an effort to stabilize the industry by providing a reliable
ongoing supply of safety products and recall kits. This transaction
also facilitates providing recovery to victims and saving American
jobs.
In my role, I became one of Key Safety's lead negotiators in our
effort to purchase Takata and to address the issues of key
stakeholders.
At the beginning of the transaction process in July 2016, Key
Safety competed with a number of bidders to purchase Takata's assets.
After a lengthy competitive process, Key Safety was ultimately selected
as the best fit for the job, having earned the support of nearly all of
the world's automobile manufacturers. After months of review, the OEMs,
Takata, and a steering committee nominated by Takata selected Key
Safety as the chosen purchaser.
I am happy to report to this Committee that last month the U.S.
Bankruptcy Court in Delaware entered a confirmation order granting
approval of the transaction. The bankruptcy proceedings in Canada and
Japan have also been addressed.
Beyond the approval of these courts, the Key Safety-Takata
transaction requires review from several other government bodies, and
satisfaction of remaining key conditions to close.
First, the U.S. Department of Justice has a Plea Agreement with
Takata and we needed to work out go-forward terms with DOJ. We did so,
and I am happy to report that the $850 million penalty owed by Takata
to DOJ will be paid upon closing of the transaction.
Second, NHTSA has a Consent Order over Takata, and we needed to
work with NHTSA on several issues related to the transaction. We did
so, thanks in large measure to NHTSA Deputy Administrator Heidi King
and her team.
Third, because Key Safety is ultimately foreign-owned, the parties
submitted a joint voluntary notice to the Committee on Foreign
Investment in the United States (CFIUS). Clearance by that Committee is
a condition to closing the transaction. I can report that Takata and
Key Safety are working closely with CFIUS and we are hopeful that it
will clear the transaction which will enable us to close in April 2018.
The purchase of most of Takata by Key Safety goes toward addressing
the Takata airbag crisis head-on. As part of the transaction, certain
parts of existing Takata and certain newly created entities--which we
call RTK, or ``Reorganized Takata,'' will emerge from the Takata
bankruptcy to continue to address any remain PSAN airbag inflator
issues. Key Safety will produce critical airbag modules and recall
kits. Some airbags will use the PSAN inflators made by RTK. Others will
use other inflators. These outputs will enable OEMs to fulfill the
pending Takata airbag recalls and continue their global production.
The deal is also anticipated to provide more than $130 million to
Takata victims, which is in addition to the $125 million paid as part
of the DOJ Plea Agreement. Absent the deal, these funds would not be
available.
For me, as a proud Michigander who has spent his entire life in the
U.S. auto industry, this transaction has become personal. This is also
reaching for a day when the airbag crisis is fully resolved and when
this transaction provides full stability to the industry. This
transaction will resolve a critical issue in the industry and
facilitate the continuity of supply needed to maintain stability in our
industry. We at Key Safety are happy to play a role in the solution and
in achieving this result.
I want to thank the Committee for inviting me to speak today. I am
happy to answer any questions. Thank you.
Senator Moran. Mr. Perkins, thank you for the honor of your
appearance.
Let me now turn to Mr. Schostek.
STATEMENT RICK SCHOSTEK, EXECUTIVE VICE PRESIDENT, HONDA NORTH
AMERICA, INC.
Mr. Schostek. Thank you, Mr. Chairman, and Ranking Member
Blumenthal, and members of the Subcommittee.
My name is Rick Schostek, Executive Vice President of Honda
North America, and I also thank you for this opportunity to
update you on our progress with regard to the Takata recall.
I want to begin by saying that we extend our sincere
sympathies to the families and friends of the victims of this
Takata recall who have been killed or injured in our vehicles.
And I want to acknowledge and apologize to Mr. Brangman, and
others, who have suffered from these tragic circumstances.
Mr. Chairman, I want you to know that each and every Honda
associate who works on this problem takes this very personally.
The Takata recall, unprecedented in its size and scope, has
been met by Honda with unprecedented action as well. Currently,
as you have heard, 19 automakers have 50 million Takata
inflators under recall. This includes about 18.5 million
inflators in our vehicles.
During the past 3 years, a passionate group of people at
Honda have made an extraordinary effort to reach out to our
customers, to have replacement parts available, and to work
with our dealers to quickly repair vehicles.
As a result, we have replaced, or accounted for, nearly 14
million inflators. That is a completion rate of over 72
percent.
We have sent over 150 million communications through an
array of methods, including some never used before in recall
campaigns. We also have employed door to door canvassing teams,
scoured salvage yards, and partnered with State DMV's.
One unique initiative we have undertaken was based on a
collaborative relationship that we established with Ms.
Stephanie Erdman, who herself was the victim of a Takata
inflator rupture in one of our vehicles, and who also testified
before the Committee in 2014.
Last fall, Honda and Ms. Erdman collaborated on a new
Public Service Announcement. I would like to share that with
you now.
[Video presentation.]
Mr. Schostek. There have been 13 deaths in our vehicles in
the U.S. due to Takata inflator ruptures. The majority of these
fatalities were due to the so-called ``alpha'' inflators that
have an alarming rupture rate; as high as 50 percent.
Last year, teams of some 550 Honda representatives began a
nationwide, grassroots outreach that has led them to knock on
the doors of alpha vehicle owners more than 600,000 times.
So from a population of almost 1.1 million vehicles, and
these are 16 to 18 year old vehicles, with the high risk of the
alpha inflators, about 62,000 remain on the road. So for the
alpha inflators, that is a completion rate of 94 percent.
Still, we have learned a number of lessons along the way.
Together with our dealers, we are good at repairing vehicles,
but finding and convincing customers of older model vehicles to
complete recalls, now that has proved a difficult challenge.
We remain convinced that the single most effective measure
to ensure recall completion would be to tie the annual State
vehicle registration process to a requirement that safety
recalls be addressed. This would be particularly important for
older, used models.
Had the requirement that defects be repaired prior to
registration been in place, the vehicle that Mr. Brangman's
daughter was driving would have been repaired.
And by the way, I want to take another minute to publicly
thank Mr. Brangman for his efforts to raise awareness on this
critical issue. I know he traveled across the country to be
with us today, and we appreciate the fact that he is here.
So toward this end, later this week, as Mr. Buretta already
mentioned, the auto industry will announce a new, high volume
batch look-up tool that will make it easier and faster for
DMVs, insurance companies, auction houses, repair shops, car
dealers, and others to look up vehicles affected by a safety
recall.
This new tool will enable stakeholders who have touch
points with vehicle owners to look up as many as 10,000 VINs at
a time.
This unprecedented public health challenge requires
unprecedented action from every stakeholder in the effort to
find and notify customers.
Given this Committee's focused interest on motor vehicle
safety, we ask that you encourage the broad array of
stakeholders, including insurance companies, DMVs, and others
to use the new batch look-up tool to help get customers to fix
safety defects.
For our part at Honda, we will continue to dedicate
ourselves to honor the relationship we have with our customers.
Thank you.
[The prepared statement of Mr. Schostek follows:]
Prepared Statement of Rick Schostek, Executive Vice President,
Honda North America, Inc.
Thank you, Mr. Chairman, Ranking Member Blumenthal and members of
the subcommittee. My name is Rick Schostek, executive vice president of
Honda North America, Inc. It has been more than two and a half years
since I last appeared before the full Commerce Committee. I want to
thank you for this opportunity to update you on Honda's progress in
addressing this serious safety issue within our industry and to address
the critical work that remains before us.
I want to begin by saying that we extend our most sincere and
heartfelt sympathies to those who have been injured or have lost loved
ones due to the rupture of a Takata inflator in one of our vehicles.
The Takata airbag inflator recall, now unprecedented in its size
and scope, has been met by Honda with unprecedented action. Currently,
the industry has 50 million Takata inflators under recall. This
includes about 18.5 million Takata inflators in some 11.9 million Honda
and Acura vehicles.
During the past three years, a truly passionate group of people at
Honda have attacked this issue relentlessly, with their best thinking
and greatest energy, including contacting our customers more than 150
million times to alert them to this recall. Our dealers have also
responded to this challenge, working in a productive collaboration with
us. As a result, we have replaced or accounted for nearly 14 million of
the total inflators under recall, which represents a completion rate of
over 72 percent.
This is far ahead of the rest of the industry and reflects our
extraordinary effort to reach out to customers, our commitment to have
replacement parts available, and the work of our dealers to quickly
repair vehicles. Due to our focus on taking care of our customers, we
moved quickly to find and locate new sources of replacement inflators,
and we have had no backorders on replacement inflators since October
2016. We also are grateful to our customers who have already responded
to the recall and had their vehicles repaired. While we are proud of
our team's effort, we do not view it as an achievement to celebrate. It
is our responsibility as a manufacturer.
Since my last appearance before you, six people have lost their
lives in the U.S. due to ruptured Takata inflators in our older model
vehicles. One of these incidents involved the rupture of a Takata
inflator that was not part of the original equipment installed in the
factory and was not installed by one of our dealers. Instead, it was
repaired independently, with the inflator sourced from a salvaged
vehicle. These incidents bring to 13, the number of deaths that have
occurred in our vehicles in the U.S. related to Takata inflator
ruptures.
In most recalls, companies tend to rely on one or more letters
addressed to the last known address of the vehicle's owner to provide
notice of the defect. However, given the risk and breadth of this
recall, we have gone far beyond that. This includes:
A special website dedicated to the Takata inflator recalls
and make all materials available in English and Spanish.
More than 35 million phone calls to customers and sent more
than a million text messages targeting owners of affected
vehicles.
A multi-million dollar advertising campaign with full-page,
color advertisements in more than 120 newspapers, and 30-second
radio announcements in more than 110 markets, targeting 9
southern states that have been identified as representing the
greatest risk to affected owners.
Print, digital and radio advertising campaign in select
markets, including Florida's Miami-Dade and Broward counties,
one of the identified high risk areas.
Promoting the recall on scoreboards at Honda-sponsored music
concerts targeting young people and other events sponsored by
Honda.
Social media, including Twitter, and a customized Facebook
campaign that targeted specific individuals who own affected
vehicles.
A nationwide search of salvage yards to find and purchase
recalled inflators that has successfully removed over 119,000
inflators that can no longer be installed as replacement parts
in the vehicles of unknowing customers.
We want to thank those companies that have supported these efforts
because, despite our request for support from insurance companies and
others who are in regular communication with affected customers, the
challenge of reaching owners has been left largely to the automakers.
Another unique and important initiative Honda took was based on a
relationship that was formed during my first appearance before this
committee on November 20, 2014. Just prior to the hearing, I had the
humble honor to meet Stephanie Erdman, who was the victim of a Takata
airbag inflator rupture in one of our vehicles and sustained serious
injuries. What began with an awkward conversation evolved into a joint
effort to help save the lives of others.
First, we co-authored an op-ed commentary to encourage legislative
action on an important opportunity to increase recall rates. Then, last
fall, we collaborated on a new public service announcement in which Ms.
Erdman courageously shared the story of her accident and injuries in
order to prevent other drivers from having the same horrific
experience. Honda used social media to target this PSA to almost seven
million owners of unrepaired vehicles, and millions of people have seen
it on YouTube. I would like to share one version of this PSA with all
of you.
We created several versions of this PSA, of varying lengths and
content, as well as in Spanish and English. We also have made it
available for use by NHTSA and automakers and other stakeholders free
of charge. And a number of companies have already signed agreements
allowing them to do so.
This Committee put Ms. Erdman and me together. Since then our
relationship has been a unique collaboration that we hope has saved
lives. And we all owe her a debt of gratitude for her selfless effort
to use a deeply personal tragedy to help others.
It is critical to understand that the majority of the 13 fatalities
in our vehicles were due to the so-called ``Alpha'' inflators, found in
certain 2001 to 2003 Honda and Acura models. These Alpha inflators were
found by NHTSA and Takata to have an alarming rupture rate of as high
as 50 percent.
Given the extreme risk posed by the ``Alpha'' inflators, last year
we began a nationwide grassroots outreach effort to physically locate
hard to reach owners of Alpha vehicles who have not responded to our
prior recall outreach efforts. This initiative involves sending
dedicated teams of Honda representatives nationwide, some 550 in total,
who are physically knocking on the doors of customers, already more
than 600,000 times, in the effort to assist them with scheduling and
completing recall repairs. An effort like this is unique, and we will
evaluate its effectiveness in meeting our goals and expectations.
In total, we now have more than 400 people in our customer contact
center working on the Takata recalls, and 135 of those agents are
dedicated to tracking down vehicles with Alpha inflators. To be clear,
that's all that these people do, day in and day out, in a dedicated
effort to save lives and prevent injuries to our customers.
Based on all of these efforts, from a population of almost 1.1
million vehicles with the higher risk Alpha inflators, only about
62,000 remain on the road to be tracked down and repaired. This
represents a completion rate of 94 percent. Considering that research
shows recall completion rates for vehicles in their 10th year of
ownership hover at about 33 percent . . . and the Alpha vehicles in
question are 15 to 17 years old . . . our efforts thus far represent an
extraordinary accomplishment.
But we aren't satisfied with this result. We are committed to
continuing our effort until we replace or account for all of the
defective Alpha inflators.
This recall effort has really been uncharted territory for Honda
and for our entire industry. As I have noted, we have tried a number of
new ideas and methods in the effort to find customers, to notify them
in a way that will get their attention, and then to convince them to
complete the recall.
Through the course of our efforts on this unprecedented Takata
inflator recall there have been a number of lessons learned. Together
with our dealers, I think we are good at repairing vehicles. But
finding and convincing customers to complete recalls, especially for
older model vehicles that are on their second, third or even fourth
customer, is a difficult challenge.
When it comes to ensuring that customers are aware of and complete
a safety recall, we remain convinced that the single most effective
measure is to tie the annual state vehicle registration process to a
requirement that safety recalls be addressed before that registration
can be completed. This would be particularly important for vehicles
that were recalled prior to the purchase of a vehicle by a subsequent
owner who may not even be aware of the presence of an unrepaired safety
defect. We believe there are numerous accommodations that can be made
so that this requirement would not be overly burdensome to vehicle
owners. While I recognize that this is ultimately the function of state
governments, I proposed this idea in each of my prior testimonies
because we believe it is the best opportunity to save lives.
Toward this end, I am excited to tell you that, later this week,
the auto industry will announce the establishment of a new batch look-
up tool that will make it much easier and faster to look up affected
vehicles to support efforts to reach hard-to-find vehicle owners about
an outstanding safety recall. Currently, anyone checking vehicles for a
safety recall must look up one VIN at a time, which is inefficient and
cumbersome. This new tool can look up large batches of up to 10,000
VINS at a time.
This new batch tool responds quickly, will be offered completely
free of charge to DMVs, insurance companies, salvage yards, repair
shops, new and used car dealers, and others who have touch points with
vehicle owners. With this new batch lookup system, we are hopeful these
stakeholders will become more active in helping to locate the owners of
recalled vehicles requiring a repair.
Getting cars fixed is our responsibility. But this recall is an
unprecedented public health challenge that requires unprecedented
action from other stakeholders in the effort to find and notify
customers. The insurance industry. The salvage industry. Used car
dealers. DMV and state inspection authorities. And, given this
Committee's focused interest on motor vehicle safety, we ask that you
encourage these industry and government sectors to use the new batch
look-up tool to urge or require their customers to get safety defects
fixed as soon as possible.
This is not business as usual for Honda. In my first appearance
before this committee, I said we would do our very best to repair every
car affected by the Takata inflator recall. This remains our
commitment. And we will continue to dedicate ourselves to honor the
relationship we have with our customers.
Thank you.
Senator Moran. Thank you very much.
Ms. Ujkashevic.
STATEMENT OF DESI UJKASHEVIC, GLOBAL DIRECTOR, AUTOMOTIVE
SAFETY OFFICE, FORD MOTOR COMPANY
Ms. Ujkashevic. Good afternoon, Chairman Moran, and Ranking
Member Blumenthal, and Senate Committee members.
My name is Desi Ujkashevic. I am the Global Director of the
Automotive Safety Office at Ford Motor Company.
Ford has more than 85,000 employees in the U.S., and we are
proud to have more hourly employees and produce more vehicles
in the U.S. than any other automaker. The safety of our
customer is our top priority, and I appreciate the opportunity
to be here with you today to discuss this Takata air bag
inflator recall.
The Takata air bag inflator recall is truly unprecedented,
as you heard here today. According to NHTSA's data, the Takata
recall involves about 50 million inflators in approximately 37
million vehicles. NHTSA is currently tracking Ford's
replacement of 1.57 million inflators.
Throughout this process, Ford has fully cooperated with the
NHTSA, the Independent Takata Monitor, and the rest of
industry. Ford is absolutely committed to taking care of our
customers and ensuring the remedy order we deliver.
Ford's strategy is to offer our owners non-Takata, non-
ammonium nitrate based inflators. For the vehicles NHTSA has
designated as the highest priority--the Mustang, the Ranger,
and the GT--we now have replacement parts available for these
vehicles. We will also have final replacement parts for Ford
vehicles lower on NHTSA's priority in the coming months.
Working with the Monitor and NHTSA, Ford has learned many
new and innovative ways to communicate with our customers.
Traditional approaches, such as first class mail, are effective
with certain populations while others are more responsive to
new methods including social media, innovative calling
strategies, and unique experiential marketing. We are using
data analytics to help tailor responses to unique customer
groups.
Moving forward, we will continue to explore new approaches,
share our experiences with the others, and enhance our outreach
programs.
Now, I would like to address our recent ``Do Not Drive''
warning. First and foremost, we are aware of the two fatalities
caused by the Takata air bag inflators that ruptured in our
2006 Rangers. On behalf of everyone at Ford Motor Company, I
would like to extend our sincere condolences to those families.
I would like to also assure this Committee that we moved
quickly to issue the ``Do Not Drive'' warning as soon as we
understood there was a population of these 2006 Rangers with
inflators that posed a much higher risk than other Takata
inflators.
When the first fatal accident occurred, all of the data,
the testing, and analyses were shared between NHTSA, Takata,
and our engineering team. The collective judgment was that this
event was consistent with the overall risk that Takata
inflators posed.
Then later, on December 22, 2017, we learned of a second
fatal accident involving a 2006 Ranger. We immediately took
action to inspect the vehicle within days on December 27. We
found that it was built with a Takata inflator that was
produced on the same inflator lot.
We worked with Takata to understand their production
records for these inflators, and then we issued a ``Do Not
Drive'' warning to owners of any Rangers with inflators that
were built on that same lot from Takata.
We were not satisfied with our level of understanding to
this problem. We worked diligently with NHTSA and Takata
running thousands of tests and evaluating this data. The test
data clearly showed a production period of higher risk
inflators causing Ford to immediately expand the ``Do Not
Drive'' population to vehicles that may have received one of
these suspect parts. I am very proud of how quickly our entire
team worked and responded to help protect our customers.
We now have non-Takata, non-ammonium nitrate parts for all
of these vehicles, and Ford is persistently contacting owners
to urge them to not drive these vehicles and to make
appointments with their dealers to have these vehicles
remedied.
We will continue to use innovative approaches, as was
mentioned today, to ensure that we reach every one of these
owners.
In summary, this is indeed the largest, most complex
automotive recall in history affecting our customers,
manufacturers, and suppliers. It has brought NHTSA, the
Monitor, and the entire industry together to help resolve this
problem.
As you also learned today, there has been much progress
made on this topic, but we all recognize there is more work to
be done.
Ford remains committed to taking care of our customers and
I can assure you that this Takata recall has the full
commitment of the entire Ford Motor Company and our leadership.
I want to thank you very much for your time and attention
today, and I look forward to addressing your questions.
[The prepared statement of Ms. Ujkashevic follows:]
Prepared Statement of Desi Ujkashevic, Global Director,
Automotive Safety Office, Ford Motor Company
Good afternoon. My name is Desi Ujkashevic. I am the Global
Director of the Automotive Safety Office at Ford Motor Company.
Ford has more than 85,000 employees in the U.S., and we are proud
to have more hourly employees and produce more vehicles in the U.S.
than any other automaker. The safety of our customers is a top
priority, and I appreciate the opportunity to discuss the Takata airbag
inflator recall with you today.
As the members of the subcommittee know, the Takata airbag inflator
recall is truly unprecedented. According to NHTSA's data, the Takata
recall involves about 50 million inflators in 37 million vehicles.
NHTSA is currently tracking Ford's replacement of 1.57 million
inflators. Throughout this process, Ford has fully cooperated with the
NHTSA, the Independent Takata Monitor, third party experts, and the
rest of industry, and Ford is absolutely committed to taking care of
our customers and remedying the recalled vehicles.
Ford's strategy is to offer our owners non-Takata, non-ammonium
nitrate based replacement parts. For the vehicles NHTSA has designated
as the highest priority; the Mustang, Ranger, and GT, we now have non-
Takata, non-ammonium nitrate replacement parts available. We will have
final replacement parts for Ford vehicles lower on NHTSA's priority
list in the coming months.
We are working closely with NHTSA and the Monitor to understand and
implement the best practices for effectively encouraging owners to
complete this recall on their vehicles. The Takata inflator recall
demands an unprecedented level of outreach to owners and coordination
with the Agency, the Monitor, our dealers, suppliers, and other
automakers. This is a critical and collaborative effort that requires
all of us across the industry to learn from each other and work
together. Today NHTSA tracks Ford's recall completion rate at 46
percent. We are not satisfied and we are committed to contacting every
owner.
I am pleased to share with you some of our actions that have helped
us to achieve the current completion rate and we are confident will
lead to steady progress. Working with the Monitor and NHTSA, Ford has
learned new and innovative ways to approach communicating with
customers. Many of the traditional approaches such as first class mail
are effective with certain populations while others are more responsive
to new methods including social media, innovative calling strategies,
and unique experiential marketing. In concert with the Monitor and
other automakers, we are using data analytics to study the
effectiveness of these new approaches and develop tailored responses to
unique customer groups. Moving forward, we will continue to explore new
approaches, share experiences and work collaboratively with NHTSA and
the entire industry to enhance our outreach.
Next, I would like to address our recent ``Do Not Driver'' warning.
First and foremost, we are aware of two fatalities caused by Takata air
bag inflators that ruptured when they deployed in 2006 Rangers. On
behalf of everyone at Ford, I want to extend our deepest sympathies to
those two families.
Second, I would like to assure the members of this Committee that
we moved quickly to issue the ``Do Not Drive'' warning as soon as we
understood there was a population of the 2006 Rangers with inflators
that posed a much higher risk than other Takata inflators. When the
first fatal accident occurred, all of the data, testing, and analyses
were shared between NHTSA, Takata, and Ford. The collective judgment
was that this event was consistent with the overall risk that Takata
inflators posed.
Then, on December 22, 2017, the Friday before Christmas, we learned
of second fatal accident involving a 2006 Ranger. We inspected the
vehicle on December 27, determined that it was built on the same day as
the inflator in the other fatal rupture, worked with Takata to
understand their production records for these inflators, and then
issued a ``Do Not Drive'' warning to owners of any Rangers with
inflators built on that date.
We were not satisfied with our understanding of this problem. We
worked daily with NHTSA and Takata running thousands of tests and
evaluating the data. The test data clearly showed a production period
of high-risker inflators causing Ford to immediately expand the ``Do
Not Drive'' population to vehicles that may have received one of these
higher-risk inflators. I am proud of how quickly our team responded and
worked cooperatively with Takata and NHTSA to help protect these
owners.
Final replacement non-Takata, non-ammonium nitrate inflators for
these vehicles are available, and Ford is persistently contacting
owners, leveraging all the outreach learnings we have acquired
throughout the Takata recall process, to urge them to stop driving
their vehicle and contact their dealer to get it repaired. We will use
the innovative approaches I mentioned earlier to reach every affected
owner.
In summary, this is the largest, most complex automotive recall in
history affecting many of the global auto manufacturers and suppliers.
It has brought NHTSA, the Monitor, and the entire industry together to
help solve this problem. As you have learned today, there has been much
progress made and we recognize there is still more work to be done.
Ford remains committed to taking care of our customers and I can
assure you that this Takata recall has the full commitment of our
Company and the Company's leadership.
Thank you for attention to this topic and I look forward to
addressing your questions.
Senator Moran. Thank you all for your testimony. We have
approximately 15 to 20 minutes remaining before a vote, and we
will conclude the hearing when the vote is called.
Let me ask a series of questions and hopefully in a timely
fashion. I am not exactly sure who all these questions should
be addressed to, but let me start with the two names that are
most difficult to pronounce, Mr. Schostek and Ms. Ujkashevic.
Assure me that Ford, and Honda, and other automobile
manufacturers, that there is no brand loyalty, no financial
incentive to not see the recall quickly completed,
notifications given, recall completely completed, and the
defect repaired and replaced.
What would be any incentive that you would have not to see
that occur quickly?
Mr. Schostek. Well, Mr. Chairman, speaking for Honda,
absolutely.
We, in the auto industry, are all in this together. We have
been thankful for Mr. Buretta's guidance with quarterly
meetings.
There is no competition or brand loyalty among automakers.
We need to get these inflators replaced and fix these vehicles.
One example I can think of for Honda is we prohibit our
dealers from selling used cars that have a defect. That applies
to the Honda used cars they have on their lot as well as the
used cars of other makers. So we certainly do not see this as a
competition or as brand loyalty.
We see this as an industry problem created by Takata's
deception that needs to be remedied as quickly as possible.
Ms. Ujkashevic. I can only make a similar commitment on
behalf of Ford Motor Company. We are absolutely committed to
not only sharing the information and the test data that we
garnered through Takata and NHTSA, but also in sharing our best
practices around the outreach programs.
Because as you recognized today, the next part of our
journey is to successfully reach these customers and encourage
them to make appointments with their dealers and to have these
parts remedied.
Senator Moran. Let me ask, then, about prioritization. So
we are making a determination what vehicle needs to be repaired
the soonest.
Is that prioritization related to the notification or to
the work done? Everyone gets a notice and then the
prioritization occurs to the work. Again, I do not know who to
look to for this answer.
Mr. Schostek. So Mr. Chairman, when NHTSA issued their
Consent Order and scheduled the recalls, they did that by
priority order as was discussed with Deputy Administrator King
just a while ago.
So it has called for phases of recalls. The third phase was
just completed in January of this year. So each automaker added
more inflators to the number to be recalled. There will be
another phase, phase four, in January of 2019. As she
explained, those are based on age of the vehicle, and also
heat, and humidity factors.
Senator Moran. The prioritization occurs in the
notification. It comes a bit in the question or the comment
that the Senator indicated earlier. So someone only gets a
notice only to arrive at the dealership to discover it is not
their turn to have the defect repaired. But that is not the
case. They would not get a notice until their priority is
reached?
Mr. Schostek. That is correct. That is not the case. And
Mr. Chairman, we have not had a backorder of a replacement
inflator for a Takata inflator since October of 2016. We have
had adequate parts for all the recalls that have been announced
since October 2016, speaking for Honda.
Senator Moran. And that gets to my question about
prioritization. Why is it necessary to prioritize? Why are we
incapable of notifying every purchaser of a vehicle that is
affected? Why is a prioritization necessary? Is it the part?
Mr. Schostek. Very good question, Mr. Chairman. And
speaking for Honda, this is a global recall. This is a global
problem, not just a U.S. problem.
We have 18.5 million inflators recalled in the United
States. We have 51 million inflators recalled globally. So
while we do have adequate parts for all that have been recalled
to date here in the U.S., there are other areas of the world
where we need to have capacity for parts supply for the recalls
that have been recalled in Japan, or Malaysia, or in other
places, Brazil.
So for us, it is a global parts resources issue, but
thankfully, here in the U.S., we have not had a replacement-
backorder since October 2016.
Senator Moran. Is that true also for Ford?
Ms. Ujkashevic. Let me just back up and answer your
question in the context of final remedy.
First of all, we have final remedies available and parts
available for all of the priority program as defined by NHTSA.
The next batch of priority programs will have parts in the
coming months. So I am confident that we are well supporting
the priorities as outlined.
But what is also important is that we have final remedy
solutions that take us away from both Takata and ammonium
nitrate-based Takata systems, which is a significant
development.
Senator Moran. Mr. Kelly's testimony was about testing that
has been done to determine the cause of the defect. Is that a
good summary of what your mission is?
Mr. Kelly. Correct.
Senator Moran. And then what is the testing that
demonstrates that the defect repair is effective and safe?
Mr. Kelly. So as part of the second phase of the process,
what we are doing with our testing is that we are looking at
desiccated inflators. We are looking at trying to determine a
predictive aging model where manufacturers, and others, can put
a lot of inputs into the model to sort of get an idea of how
the inflator is going to react and how it will perform in the
real world.
When we get done with that model, we are expecting that
model to probably take more than a day, possibly up to two days
to run all of the different factors. So that is sort of the
second phase of what we are going to be releasing here in the
next few months.
Senator Moran. My time has expired and to live up to my
admonition about a 4:15 p.m. conclusion, let me ask this
question for the record and we would welcome a conversation as
well as a response in writing.
The testing that occurred to determine the cause of the
defect, I would appreciate it being explained to me why the
testing does not occur?
What is the process by which one of the automobile
manufacturers makes a determination to purchase a Takata air
bag for their vehicle?
What testing would have occurred by Takata, or by the
automobile manufacturer, in making a decision that this was an
acceptable safety component of a vehicle that we ultimately
will manufacture and sell to consumers around the world?
Your testimony strikes me as this is something that should
have happened in the manufacturing and supply aspect of the
automobile manufacturing process at a time much earlier than
after the fact of the defect discovered, and the death and
injuries occurred.
I know that is a longer answer than I have time for today
for the moment, but I would welcome that description of the
process of how it takes place.
Senator Blumenthal.
Senator Blumenthal. Thanks, Mr. Chairman.
We know, Mr. Schostek, that Honda provides loaner vehicles
to anyone who has a defective air bag.
Is that correct, as a matter of policy?
Mr. Schostek. That is correct, Senator. We do have a policy
that our dealers are to provide a loaner vehicle to customers.
Senator Blumenthal. Ms. Ujkashevic, why does Ford not do
the same?
Ms. Ujkashevic. That is a great question, and our policy
has evolved. We currently are offering loaner vehicles for our
higher risk Ranger programs. We also are offering loaner
vehicles to those customers who come in and we do not have a
remedy solution for them.
Senator Blumenthal. Will you commit to evolve your policy
further and adopt Honda's policy? I do not mean to make it
Honda's policy, but provide loaner vehicles to everyone who has
a defective and potentially lethal part in their car?
Ms. Ujkashevic. I can promise you we assess our customer
safety needs and ensure that we offer adequate solutions. I do
not have the specifics behind Honda's overall policy, but very
specifically to this Takata issue that we are discussing here
today, we have loaner policies in place for our customers, and
I would encourage our customers to contact their dealers.
Senator Blumenthal. Well, I know you have loaner policies
in place. I just want to make sure that Ford--and all of the
other automobile makers that have still millions of cars out
there with potentially deadly, defective parts--provides these
loaners as a matter of policy, as do six, including Honda,
already.
I am just asking whether you can commit or go back to your
company and answer the question? I am not holding you
personally responsible. I know it is a matter of corporate
policy. Whether you can commit that you will follow that
approach and you can respond in writing later, if you would
like.
Let me ask you, I am told that the allegation has been
made--and by the way, I understand that Ford is a member of the
United States Council for Automotive Research [USCAR], which
has a specification for air bag inflators called USCAR-24 or
USCAR-24 Inflator Technical Requirements and Evaluation
Specification. The first version appears to have been issued in
2004; the second in 2013.
I know that the allegation has been made that Ford, as a
member of that organization, requested to modify the
specifications supposedly because they could not be met. And
then, according to a complaint in a recent class action
lawsuit, Ford in October 2003 sent a fax to Takata asking
whether they could avoid meeting those specification for
certain air bag inflators. And said, quote, ``We found a
loophole where we do not need to meet the USCAR since the
specification was not released when we signed the Statement of
Work.''
Is that true?
Ms. Ujkashevic. Senator, without seeing the context of the
data that you are referencing, I can give you a summary of what
I know is in place.
We are, indeed, participants in the USCAR specification and
we have worked with developing a specification that is very
stringent around air bags and inflator systems.
Senator Blumenthal. Did the Takata inflators used by Ford
deviate from USCAR-24 specifications?
Ms. Ujkashevic. The Takata air bag inflators that are being
discussed did not deviate to the USCAR spec that would be
relevant in the context of the deployment disruptions.
Senator Blumenthal. The latest version of those
specifications, I understand, was issued in 2013. I would hope
that Ford is planning to update its inflator standards.
Is it?
Ms. Ujkashevic. We are working to specifically update the
inflator spec and what I was saying earlier is if you look
across the inflator providers--Autoliv, TRW, and Takata--they
have deviations to part of that USCAR spec.
But I can assure you that none of the deviations were very
specific to what we saw here in the explosives.
Senator Blumenthal. Thank you. My time has expired, but I
will have additional questions for the record.
Thank you very much to all the folks who are appearing
today.
Senator Moran. Senator Cortez Masto.
Senator Cortez Masto. Thank you.
Thank you all as well for coming today.
Mr. Schostek, let me start with you because you talked
about a new system that is being implemented. Just so you can
verify, is it true that it is legal for air bag assemblies, or
other parts subject to a recall, to be pulled out of wrecked
cars and sold by junkyards to repair shops that may not even
know the danger of the recall?
Mr. Schostek. Senator, thanks for the question.
I believe that it is illegal for them to sell them, but it
is happening. We have had eight ruptures that had to do with
recycled or harvested air bags, including the one that you
mentioned with Ms. Dorado in your state.
Senator Cortez Masto. So it is illegal for them to do that
if they know it is subject to recall?
Mr. Schostek. If it is a defective part, they should not be
selling it.
Senator Cortez Masto. OK.
Mr. Schostek. Or they should not be using it.
Senator Cortez Masto. And so, can you talk about the system
you talked about? Would this address it? Would it allow these
types of entities to have access to up to 10,000 VINs at a time
to check for recalls? Is that the intent here?
Mr. Schostek. Exactly, Senator. Exactly.
I am glad you are inquiring about this because in the last
couple of years, since I appeared before the Committee last,
especially with these alpha vehicles which, as I said in my
testimony, are 16 to 18 years old. These are older vehicles
that have changed hands two, three, four times. And frankly,
the data that is available is difficult on some of these
vehicles.
We have been trying to work with other organizations, to
name two, insurance companies and recyclers, to get some more
cooperation from them to avoid the kind of thing that happened
to Ms. Dorado.
On the side of the insurance companies, we figured out that
at any one time, insurance companies may own at least 10,000
vehicles that have recalled inflators in them; 10,000. Of
course, these are cars that have been in an accident, and then
totaled. In this case, the air bag did not deploy. So there is
a recalled inflator that the insurance company owns in that
wrecked vehicle.
We tried by requesting this information from insurance
companies, they did not cooperate with us and provide it to us.
Finally, we had to resort to issuing subpoenas to them. We
were able to use the power of the MDL Administrator in the
Florida case and issued subpoenas to 13 insurance companies.
All we wanted to know is: tell us the vehicles that you
have that may have these defective inflators in them.
We figured out eventually that these vehicles are in
different salvage yards or different auction houses. And we
finally have got the permission. It took 6 months for one
insurance company to answer our subpoena. Some were good, do
not get me wrong. Some insurance companies were very, very
responsive.
But finally, as of last month, we got the agreement from
every insurance company that they are going to notify us if one
of those recalled inflators comes into their possession and
authorize us to fix the car. We then can seek permission to
enter onto that recycler's or junkyard property and repair or
remove that inflator. It is a big problem.
So the point, Senator, is that this new batch system that
we have will allow insurance companies, State DMVs, auction
houses, to check a bunch of VINs at a time. And this is not
just for Honda vehicles. It is any defect in any OEM's vehicle
that is out there. This is a breakthrough moment for having
this batch system available.
We would really like to encourage the Committee to
encourage those other stakeholders, again, insurance companies,
auction houses, recyclers, and so forth, to use this batch
system because it is going to enable us to do things that we
could not do before.
Senator Cortez Masto. And this system is to be up and
running or online. Do you have a time-frame for it?
Mr. Schostek. Yes, Senator. It will be publicly announced
on Friday of this week at the National Automotive Dealers
Association meeting.
There is a process to sign up for use of this new system.
Of course, we are very respectful of the privacy of
information. So there has to be certain conditions agreed to,
to access this system.
But the system will be operational by the middle of April.
Senator Cortez Masto. And so, because I appreciate your
lessons learned, and one of the things you had talked about was
possibly mandating vehicles be repaired prior to registration
or renewal of registration. And so, with this system up and
running, it would be much easier for a DMV to also check when
somebody comes in to renew a registration or to register a
vehicle whether there is a recall that is associated with the
VIN.
Mr. Schostek. Absolutely, Senator. With this system, we
think it is possible for a State DMV to check a number of VINs.
We would hope that a state would take the strong position that
tying recall completion to vehicle registration is the best way
to ensure completion, especially for older vehicles.
So we stand ready to work with any state which wants to put
that into effect.
Senator Cortez Masto. Thank you. I know my time is running
out. Does anybody else have any comments with respect to that
discussion, concerns, or disagrees with it?
[No response.]
Senator Cortez Masto. All right. Thank you. Thank you very
much.
Senator Moran. Thank you.
My usual practice, once again, is to allow any of our
witnesses to make clear, or to correct, or to say something
that they did not have an opportunity to say.
Mr. Perkins, you and Mr. Buretta had fewer opportunities to
respond to questions than others.
But does anybody on the panel have something they want to
make sure is entered into the record and that we are made aware
of?
Mr. Perkins.
Mr. Perkins. Mr. Chairman, I would just like to add the
Government, across a broad range of work streams, has been
incredibly collaborative through a very, very complex process.
So I thank you for that.
Senator Moran. Thank you for that comment.
Anyone else?
The hearing record will remain open for 2 weeks. During
that time, Senators are asked to submit any questions for the
record. Upon receipt, the witnesses are requested to submit
their written answers to the Committee as soon as possible.
Let me conclude this hearing by, once again, thanking the
witnesses for being here.
Expressing our condolences to those who have lost family or
friends, as well as those who have been injured.
I thank the witnesses for appearing.
This hearing is now adjourned.
[Whereupon, at 4:17 p.m., the hearing was adjourned.]
A P P E N D I X
Response to Written Questions Submitted by Hon. Todd Young to
Heidi King
Question 1. In your testimony, you mention that under the Consent
Order, NHTSA and the Independent Monitor are encouraging best practices
(i.e., texting, social media, and door-to-door canvassing) to notify
consumers of owning a car that needs to be fixed. What lessons have you
learned in the process of developing your best practices? What has
worked? What has not?
Answer. The required first-class mailing is an important part of
official notification, but it is just one step in informing consumers
of the risk they face. There are many challenges to successful recall
completion. These challenges include obtaining accurate contact
information for affected consumers, communicating effectively with
those consumers, and ensuring dealer networks are well-informed and
actively assisting in the recall process.
Effective outreach by vehicle manufacturers includes communicating
in an attention-grabbing, direct manner that the consumer understands;
this means frequent and urgent messages delivered with simple,
straight-forward language. Personalizing the message, making clear that
recall repairs are free, and explaining the steps the vehicle
manufacturer is taking to overcome the inconvenience of recall repairs
(i.e., free loaner cars or towing) also grab consumers' attention.
Unsurprisingly, conducting outreach in a language spoken by the
consumer improves awareness and understanding of the problem. It is
incumbent upon vehicle manufacturers to work creatively and effectively
across their internal teams to develop strategies that accurately
locate affected vehicle owners and then effectively communicate the
urgent nature of the defect and the free repair.
NHTSA and the Independent Monitor have provided recommendations and
best practices, and will continue to provide information to vehicle
manufacturers to assist them in achieving the remedy completion targets
and 100 percent accounting in the Takata recalls.
Question 2. In the development of those best practices, have you
consulted with behavioral economists to help identify the most
effective methods? If not, do you believe this is the type of problem a
behavioral economist might play a constructive role in developing best
practices?
Answer. Behavioral economics is a method of economic analysis that
applies psychological insights into human behavior to explain economic
decision-making. The methods studied by behavioral economists to
influence choices have been employed in many consumer-facing
initiatives and industries in recent decades to improve awareness and
influence individual decision-making. Those methods inform consumer-
facing efforts in the Takata air bag recall campaign, including the
methods, frequency, and messages employed. The Independent Monitor has
attempted to utilize this specialized knowledge, including qualitative
and quantitative research on effective outreach. NHTSA is confident
that the real-world lessons, data, and research developed have provided
robust best practices directly applicable to the Takata air bag
recalls. The Agency encourages each vehicle manufacturer affected by
the Takata recalls to adopt and implement the existing best practices.
Nevertheless, NHTSA continuously seeks input from relevant fields of
research and incorporates all lessons learned, to ensure operating
guidance best reflects the circumstances and unique nature of each
recall campaign.
______
Response to Written Questions Submitted by Hon. Bill Nelson to
Heidi King
Question 1. While some automakers have shown recent improvement in
their recall completion rates, other automakers' completion rates
remain dismal. In his report, the Independent Monitor named a number of
new ways that automakers could improve their recall completion rates.
Has NHTSA issued any new orders or guidance within the last year to
require automakers to improve recall completion rates?
Answer. NHTSA has provided guidance through regular meetings with
the vehicle manufacturers to discuss ways to improve overall recall
completion rates, and meets quarterly with the manufacturers and the
Independent Monitor to discuss industry best practices and lessons
learned for improving recall completion rates. Additionally, NHTSA
published the Independent Monitor's State of the Takata Recalls Report
in November 2017, which outlines the research, innovative approaches,
and coordination efforts across the vehicle manufacturing industry that
NHTSA and the Independent Monitor have engaged in with various
stakeholders throughout the last year.
Question 2. Has NHTSA ordered any automakers to take specific
actions recommended by the Independent Monitor? If so, please describe
the specific actions NHTSA has ordered.
Answer. Yes. NHTSA's Coordinated Remedy Order incorporates
recommendations of the Independent Monitor. The Coordinated Remedy
Order requires vehicle manufacturers to take actions to increase remedy
completion rates through supplemental owner notifications. The vehicle
manufacturers have the option of either using the Independent Monitor's
Coordinated Communications Recommendations, or proposing alternative
communications messaging or strategies to NHTSA and the Independent
Monitor. The Coordinated Communications Recommendations are available
on NHTSA's website at https://www.nhtsa.gov/document/coordinated-
communications-recommendations.
Question 3. Has NHTSA encouraged automakers to offer rental or
loaner cars, or some other form of alternate transportation, to
consumers during the time their vehicles' air bags are pending repair?
If so, please detail NHTSA's specific request to automakers. If not,
please explain why such a request has not been made.
Answer. Yes. NHTSA has encouraged vehicle manufacturers to take
actions to minimize the inconvenience of the Takata recalls to vehicle
owners, including providing transportation for consumers during their
vehicles' repair. One of the specific strategies the Independent
Monitor recommended to vehicle manufacturers was to have a dealer
loaner policy, enabling dealers to make loaner vehicles available or
provide taxi or car service to customers while a recall repair is being
performed. The Monitor also recommended clear customer communications
regarding the availability of loaner or rental cars and other policies
that address the inconvenience of the recall (such as extended dealer
service hours). The Monitor's recommendations are supported by research
indicating that free loaner vehicles help overcome the inconvenience of
the recalls and motivate owners to have the repair performed. NHTSA has
had ongoing and robust dialogue with each of the vehicle manufacturers
where the Agency emphasizes the need to reduce inconvenience to vehicle
owners. Overcoming owner inconvenience was also one of the key topics
of discussion between the vehicle manufacturers, NHTSA, and the Monitor
at the October 2017 Takata Recalls Summit hosted by the Monitor.
Question 4. Has NHTSA issued any fines or civil penalties in
response to the failure of automakers to meet the recall completion
requirements in the Takata Orders? If not, please explain why such
action has not been taken.
Answer. NHTSA has not issued penalties to manufacturers regarding
the completion rate targets outlined in the Coordinated Remedy Order
for Priority Groups 1-3. Although manufacturers have yet to meet the
ambitious targets, they have made progress in completion rates, parts
availability, and consumer outreach. NHTSA maintains robust authority
and oversight of recall completion rates and will take additional
action as appropriate.
Question 5. Will NHTSA issue fines or take enforcement actions if
recall completion rates continue to lag?
Answer. NHTSA will take all appropriate action, which may include
penalties or other enforcement action. NHTSA evaluates the facts and
circumstances to determine whether they indicate that such action would
be an effective mechanism to improve recall completion rates and get
unsafe air bags out of every affected vehicle, or such action is
otherwise warranted.
Question 6. The amended Coordinated Remedy Order requires
automakers to recall specific categories of impacted vehicles by
priority groups based on the risk of rupture. The priority groups are
set by vehicle age and location and require that recalls be initiated
by set deadlines. Several automakers have sought extensions of these
deadlines. How many automakers have sought extensions? Please list each
automaker and date of request.
Answer. Eight vehicle manufacturers have sought extension requests
across certain vehicles and priority groups. All of these requests are
currently available on NHTSA's website at https://www.nhtsa.gov/
equipment/takata-recall-spotlight#nht
sa-action-related-documents. The manufacturers and dates of requests
are listed below:
BMW: August 28, 2015; March 17, 2017 (supplemented April 13,
2017); July 31, 2017 (request withdrawn); August 24, 2017
(supplemented September 8, 2017)
DVUS: September 22, 2016; September 26, 2017 (supplemented
December 14, 2017); February 14, 2018
Ford: September 27, 2016; February 14, 2017 (supplemented
April 5, 2017); November 30, 2017 (supplemented February 9,
2018); December 18, 2017; April 11, 2018
GM: September 16, 2016; August 25, 2017
Mazda: May 15, 2017; August 15, 2017; December 15, 2018;
February 9, 2018
MBUSA: February 14, 2017 (supplemented April 5, 2017); March
1, 2018
Nissan: December 21, 2016
VW: February 15, 2018
Question 7. Has NHTSA denied any extension requests? If not, why?
Answer. No. Thus far, NHTSA has not denied any extension requests
in the Takata recalls based on the merits of the request and the goal
of expeditious replacement of defective inflators. There are, however,
extension requests that are currently pending NHTSA review. The
research and development involved in redesigning inflators as
replacement parts can take time to ensure that the replacement parts
themselves are safe. NHTSA assesses the merits of each extension
request, including the validity of the engineering and/or supply chain
challenges underlying the request and the requesting manufacturer's
efforts to timely obtain safe remedy parts, before issuing a decision.
Question 8. The two deaths caused by rupturing Takata air bags in
Ford Ranger trucks reveal that just one day of bad production can be
fatal. What steps has NHTSA taken following the Ford Ranger incidents
to ensure these production problems are identified before--not after--a
deadly incident?
Answer. NHTSA continues to engage with Takata in review and
analysis of test data from inflators returned from the field in the
ongoing effort to identify any production periods with inflators that
present enhanced risk of rupture. More broadly, NHTSA reviews each
vehicle complaint submitted to the agency for potential public safety
risk. More than 6,000 complaints are submitted to NHTSA each month, and
through this process many defects are identified and resolved prior to
any injury.
Question 9. Is NHTSA confident that no other Takata propellant
lots--including lots produced for other automakers--may contain the
same defect that led to the Ford Ranger ruptures?
Answer. One of the greatest frustrations of the Takata phase-
stabilized ammonium nitrate (PSAN) inflator recalls is the difficulty
in identifying which inflators are affected by various secondary
defects that further increase the risk the inflators can rupture. NHTSA
continues to engage with Takata in review and analysis of test data
from inflators returned from the field in the ongoing effort to
identify any production periods with inflators that present enhanced
risk of rupture. NHTSA will continue to be vigilant in the ongoing
assessment of this matter as well as in the investigation of other
defects.
Question 10. What is the status of efforts to study the safety of
Takata's desiccated ammonium nitrate-based inflators?
Answer. Several expert groups are studying the safety and possible
service-life of Takata's desiccated PSAN inflators. NHTSA anticipates
receiving briefings and reports from those groups as their research
concludes prior to the end of 2019. NHTSA has reserved the right to
demand the recall of desiccated PSAN inflators at any time if the test
data, or real-world experience, demonstrates that the inflators pose an
unreasonable safety risk to consumers.
Question 11. The Motor Vehicle Safety Whistleblower Act was passed
in December 2015 to protect the public by providing an incentive for
employees in the automotive industry to voluntarily provide information
relating to violations of vehicle-safety laws to NHTSA and other
government agencies. The statute required the Secretary to issue
regulations on the requirements of the program within 18 months, or by
June 2017 (49 U.S.C. Sec. 30172(i)). To date, NHTSA has not issued
these rules or even started the public rulemaking process. What is the
status of the rulemaking and when does NHTSA plan to issue final rules?
Answer. NHTSA is actively working on this rulemaking. NHTSA has not
currently estimated a time-frame for issuance of a final rule, since
that will depend in part on the nature and extent of public comments
the agency receives in response to its notice of proposed rulemaking.
While NHTSA acknowledges the statutory deadline for this rule has
passed, that does not impact the incentives available to whistleblowers
under the law. The FAST Act specifically enabled whistleblowers to
qualify for awards for information they provided after the enactment of
the FAST Act but prior to the effective date of the regulations issued
by the agency. The FAST Act also specified that a whistleblower may
receive an award prior to the agency promulgating the regulation.
______
Response to Written Questions Submitted by Hon. Richard Blumenthal to
Heidi King
Question 1. Please provide per manufacturer information regarding
what percent of vehicles with unrepaired defective Takata airbags have
not been repaired because parts are not available.
Answer. In general, recall completion rates reflect launched recall
campaigns (i.e., parts are available for repair). In some
circumstances, the completion rates include recall campaigns that are
launched only in part. The vast majority of the 16.9 million currently
unrepaired air bags have parts available for a repair, however, vehicle
manufacturers do not report to NHTSA specific information regarding why
certain vehicles have not been repaired. NHTSA encourages consumers who
have been told that parts are unavailable for their Takata air bag
repair, after having received a notice from their vehicle manufacturer
notifying them to schedule a repair, to visit www.nhtsa.gov and click
``Report a Problem'' to file a Vehicle Owner Questionnaire with NHTSA
for appropriate follow-up.
Question 2. What else can NHTSA do to ensure that parts are
available when recalls are issued?
Answer. Vehicle manufacturers are responsible for manufacturing
safe vehicles with properly working componentry. In the Takata recalls
specifically, NHTSA has phased the recalls in the May 2016 Consent
Order with Takata to recall inflators before they present a risk to
vehicle occupants, while also enabling vehicle manufacturers to develop
and produce sufficient remedy parts shortly after the recalls are
issued.
Question 3. When consumers must wait for replacement parts, do you
agree that automakers should provide consumers with loaner cars at no
cost?
Answer. NHTSA has encouraged vehicle manufacturers to take actions
to minimize the inconvenience of the Takata recalls to vehicle owners,
including providing alternate transportation for affected consumers.
Question 4. Please see this staff report I issued with Senator
Markey examining the loaner car policies of automakers affected by the
Takata airbag crisis: https://www.blumenthal.senate.gov/imo/media/doc/
Blumenthal%20Markey%20Loaner%20
Car%20Report.pdf. This report concluded with a number of
recommendations for NHTSA, including calling on the agency to:
Require information regarding loaner car policies be
included in recall notices.
Create a repository of automakers' loaner car policies on
NHTSA's website to increase transparency and reduce confusion
for consumers.
Would you be able to commit to implementing these two report
recommendations?
Answer. NHTSA encourages all manufacturers to work with consumers
who are seeking alternate means of transportation while their vehicle
is under recall. The Independent Monitor has long recommended to
vehicle manufacturers that their consumer outreach prominently feature
the details of all services the manufacturer or its dealers provide
that address owner inconvenience associated with the repair, including
the availability of loaner or rental cars. NHTSA is committed to
working with all stakeholders to continue working to overcome owner
inconvenience as a means of improving overall recall completion rates,
and to taking actions that further improve the safety of consumers.
Question 5. I am troubled that it took over two years after the
first fatality involving a Ford Ranger, and half a year following the
second fatality involving a Ford Ranger, for NHTSA to issue a ``Do Not
Drive'' instruction on 2006 Ford Rangers. It seems as though a lot of
attention is placed on the fatalities. But it is just as important to
track injuries that have occurred in order to evaluate risks and
identify particularly risky vehicles. How many injuries have there been
that involved Ford Rangers?
Answer. There have been two confirmed rupture incidents involving
Ford Rangers, neither of which involved non-fatal injuries. Both of the
confirmed rupture incidents were fatal incidents involving model year
2006 Ford Rangers. Vehicle manufacturers and inflator manufacturers are
required to report all allegations of a ruptured inflator to NHTSA
within five business days. The manufacturers provide updated
information to NHTSA, including when they confirm that a rupture
occurred or did not occur. NHTSA tracks all confirmed rupture
incidents, including those involving fatalities or non-fatal injuries.
NHTSA also notes that rupture allegations are not always immediately
reported. Therefore, there may be a time lag between an incident and
when the vehicle manufacturer and NHTSA learn of it. In this instance,
at NHTSA's urging, Ford initiated a recall for the model year 2004-2006
Ford Rangers in January 2016, following the December 2015 fatal crash.
Ford received notice of the second July 2017 fatal crash in late
December 2017. Ford's review of information determined that the
inflators involved in both fatal incidents, as well as a field return
part that produced a test anomaly, were produced by Takata on the same
date. Based on this information, and in consultation with NHTSA, Ford
decided to issue the ``do not drive'' warning to address the enhanced
risk to certain model year 2006 Ford Rangers.
Question 6. What information does NHTSA need to collect to be able
to assess whether autonomous vehicles are at least as safe as human-
driven vehicles? Does NHTSA currently have the required authority to
collect such information?
Answer. NHTSA does have broad authority to collect information.
However, NHTSA's collection of information is subject to the Paperwork
Reduction Act, a process which typically takes many months because of
public notice and comment requirements. In the meantime, NHTSA is
collecting information from tools such as our fatality and crash
databases, special crash investigations, investigations by other
government agencies, research field operational trials, requests from
companies for regulatory relief, discussions with manufacturers and
technology companies, and quarterly reporting from those companies
required to do so. NHTSA is also exploring the possibility of third-
party anonymous data sharing and increasing our interaction with States
who have active deployments to determine their potential usefulness to
evaluate automated vehicle (AV) performance, but such collections of
information would be also subject to the Paperwork Reduction Act.
Question 7. Takata is currently undergoing bankruptcy and about to
cease operation. What is NHTSA doing to ensure the 2015 NHTSA
preservation order continues, all documents are preserved, and testing
continues to protect the public in the future for vehicles not yet
recalled?
Answer. While the Preservation Order contained provisions that
continued its applicability in the event of a change in corporate
structure, as is happening through bankruptcy and acquisition, NHTSA
issued an Amendment to the Preservation Order on April 12, 2018. Among
other things, that Amendment specifies that the preservation
obligations imposed on Takata continue in full force and effect on the
subsequent Takata entity.
Question 8. The amended coordinated remedy order recalls inflators
through a phased approach factoring in the location (``zone'') and age
of vehicle. As you noted in your testimony, cars that move from one
state to another state must be re-categorized. How long does it take
NHTSA to re-categorize a vehicle once it is re-registered in a new
state? To what extent is the amount of time a vehicle is in a new or
former geographic location factored into the new prioritization
designation of a vehicle?
Answer. Vehicles were originally prioritized according to a ``sold
or ever registered'' criteria, so if a vehicle was originally sold or
ever registered in an High Absolute Humidity (HAH) or Zone A State it
will forever stay prioritized according to that higher-risk factor. If
the vehicle leaves the HAH or Zone A it does not move to a lower
priority group. However, vehicles that move from a lower risk Zone (B
or C) into a higher risk Zone (A or B) or from Non-HAH to HAH/Zone A,
the vehicles are reprioritized into the corresponding higher-risk
priority group. Each vehicle manufacturer obtains updated vehicle
registration information on a recurring basis throughout the year to
determine the address of record for mailing recall notifications. In
the Takata recalls, each vehicle manufacturer is updating this
information at a minimum of twice per year and, accordingly, this
process should only take a few months.
______
Response to Written Question Submitted by Hon. Maggie Hassan to
Heidi King
Question. It is my understanding that the recall prioritizes
vehicles in warmer and more humid states as ``high priority,'' while
vehicles located in colder states are lower priority. The problem with
this approach, is that cars move. They change location. As they change
location, they change temperatures. And this may put drivers at risk.
Many people in my state of New Hampshire, for example, spend their
winters down in Florida or other warmer climates. What is being done to
raise awareness to consumers that their vehicle may need attention a
lot sooner then they initially thought? Does NHTSA maintain a database
of how many recalls are needed in each state? If not, why?
Answer. The data collected and examined by NHTSA shows that long-
term exposure to combined high heat and humidity creates the risk that
a Takata air bag will explode. A vehicle that ``winters'' in a hot and
humid location does not experience the same continuous periods of heat
and humidity as a vehicle that has been driven in these conditions
year-round for many years. NHTSA prioritized Takata air bag repairs to
ensure that vehicles with air bags that pose the highest threat to
safety are able to be fixed first, while also working to ensure that
parts are available to repair every affected vehicle as quickly as
possible. Recall priority groups are based on the make, model, and
model year of a vehicle; inflator position (driver or passenger); and
the vehicle's recall zone based on temperature and humidity. There are
three recall zones: Zone A, hot and humid; Zone B, less hot and humid;
and Zone C, least hot and humid. A vehicle is placed into the highest
zone of a State or territory in which it has ever been registered.
Vehicle manufacturers inform affected vehicle owners, via first class
mail, as soon as the recall for each priority group launches. A vehicle
owner who receives a recall notice indicating parts are available
should schedule an appointment as soon as possible to get the free
repair. Vehicle manufacturers maintain the data on recalls that have
been completed and are still needed and report that data to NHTSA and
the Independent Monitor. The vehicle manufacturers report information
for the Takata recalls at the zip code level, which enables the Monitor
and NHTSA to evaluate recall completion rates by state. Detailed
completion rate data by priority group is available on NHTSA's website
at https://www.nhtsa.gov/equipment/takata-recall-spotlight.
______
Response to Written Questions Submitted by Hon. Todd Young to
John D. Burretta
Question 1. In your testimony, you mention the challenge of not
only identifying who owns the vehicles that need to be fixed, but also
how to ``identify messaging that clearly communicates the defect's risk
to consumers and motivates them to act.'' What lessons have you learned
in the process of developing communications to consumers that motivates
them to act?
Answer. Through focus groups, in-depth interviews, online surveys
and a ``mystery shopper'' program conducted in 2016, as well as
additional focus groups and a national quantitative survey conducted in
2017, I learned that awareness among affected vehicle owners as of that
time as to the existence of the recall, the scope of the Takata
recalls, the severity of the Takata defect and the urgency of the
recall was incomplete. Many affected vehicle owners did not understand
that many different vehicle makes and models are affected, did not
believe the defect is serious and did not know the repair is free and
requires little time to be conducted. The research established various
points regarding effective recall communications, including:
Outreach materials should unambiguously convey the urgency of the
situation and provide a clear and persuasive call to action, using
disruptive imagery that captures the attention of affected vehicle
owners and ensures outreach materials are not discarded or forgotten.
Communications using bright, attention-grabbing colors, employing
words like ``kill'' and ``explode'' are likely to effectively drive
action.
Sharing concrete facts regarding the Takata recalls, such as the
number of vehicles affected or the number of deaths and injuries that
have occurred, helps affected vehicle owners understand the urgent
safety risk defective Takata inflators pose and the importance of
having one's vehicle repaired immediately.
Sending traditional mailers on one or two occasions does not
adequately convey the urgency of the Takata recalls. Repeated reminders
are important.
Recall outreach should clearly convey that the repair is free of
charge.
Communications should use personalized messages with the vehicle
owner's name and showing pictures of the make, model and model year of
the owner's vehicle.
Communications should convey clearly the availability of services
that would minimize inconvenience, such as free towing, free loaner
vehicles, extended dealership hours or the availability of mobile
repair service.
Communications should clearly convey the availability of
replacement parts.
Communications should identify a clear, simple and actionable
process through which recipients can take steps to remedy the problem,
such as a URL or phone number through which vehicle owners can schedule
a repair appointment.
Providing outreach materials in a language affected vehicle owners
can understand is key to ensuring they understand the content of the
message. Content should be in multiple languages.
Further details regarding this research and resulting findings are
set out in my November 2017 report entitled The State of the Takata
Recalls, which may be accessed at https://www.nhtsa.gov/sites/
nhtsa.dot.gov/files/documents/the_state_
of_the_takata_airbag_recalls-
report_of_the_independent_monitor_112217_v3_tag.pdf.
Question 2. In the development of those messages, have you
consulted with behavioral economists to help identify the most
effective methods? If not, do you believe this is the type of problem a
behavioral economist might play a constructive role in developing best
practices?
Answer. In the development of my communications recommendations and
related pilot initiatives, I consulted with professional communication
strategists and research analysts who specialize in consumer
perceptions, communications strategy, message refinement and tactical
program development. Consistent with behavioral economic theory, our
consultants focused on the strategic use of language, imagery and
incentives to help vehicle owners overcome the perceived costs,
barriers and biases that might inhibit their getting their defective
airbags repaired. I believe these approaches effectively address the
issues surrounding Takata-related recall outreach.
______
Response to Written Questions Submitted by Hon. Bill Nelson to
John D. Buretta
Question 1. What additional steps can automakers take to improve
recall completion rates?
Answer. To improve recall completion rates, automakers should:
Send frequent, multichannel outreach that clearly describes
the dangers of defective Takata airbag inflators and conveys a
clear path to action;
Offer services that will minimize owner inconvenience, such
as free loaner vehicles and mobile repair service, and clearly
communicate the availability of such services in outreach;
Segment their unrepaired vehicle owner populations and
employ different strategies based on the needs of each
respective segment;
Continuously measure the success of the different recall
initiatives and tactics employed, so as to avoid expending time
and resources on ineffective methods and instead dedicate
resources to proven, efficient recall tactics, and
strategically forecast anticipated completion rates;
Engage and motivate dealers, including taking measures to
ensure dealer recognition and accountability, expand dealer
reimbursement policies, evaluate technician training
requirements and host dealer best practices roundtables;
Engage independent repair facilities to notify affected
vehicle owners of open Takata recalls, assist affected vehicle
owners with completing repairs and provide affected vehicle
owner contact information;
Transition from local to national strategies once a
particular initiative is observed to be effective, making sure
to plan strategically and dedicate significant forethought,
logistical planning and resources to ensure the national
initiative is effective and efficient;
Use teams with cross-functional expertise and personnel with
diverse skill sets, experience and expertise, to allow for
development of more sophisticated solutions and strategies to
accelerate recall completion;
Undertake door-to-door canvassing initiatives for higher-
risk vehicles and long-term non-compliant vehicle owners later
in recall campaigns, to proactively encourage vehicle owners to
schedule repairs, verify their contact information and
understand in greater detail the barriers vehicle owners face
in completing repairs;
Address the heightened risk posed by certain inflator types
with enhanced outreach strategies, including canvassing and
multi-touch, multi-node communications that are tailored to
affected vehicle owners; and
Implement my formal recommendations, which provide greater
detail on effectively conducting the aforementioned activities.
These initiatives are outlined in greater detail in my November
2017 report The State of the Takata Airbag Recalls, which may be
accessed at https://www.nhtsa
.gov/sites/nhtsa.dot.gov/files/documents/
the_state_of_the_takata_airbag_recalls-
report_of_the_independent_monitor_112217_v3_tag.pdf. Automakers that
have adopted these methods have made substantial progress in improving
their completion rates.
Question 2. Do you think NHTSA has done enough to push automakers
to ensure recall repairs are completed?
Answer. NHTSA is making substantial progress in pushing automakers
to ensure recall repairs are completed. I have worked closely with
NHTSA to assist automakers in improving their recall completion rates,
and NHTSA frequently participates in meetings with automakers and in
summits encouraging automakers to undertake enhanced recall techniques.
NHTSA also provides feedback directly to automakers and aims to ensure
those automakers are seeking to maximize recall repairs. NHTSA
implemented the Third Amendment to the Coordinated Remedy Order, dated
December 9, 2016, which, through its stepped series of recall repair
deadlines, incentivizes automakers to seek to ensure repairs are
completed on a timely basis.
Question 3. What additional steps can NHTSA take to improve recall
completion rates? Have you recommended that NHTSA take enforcement
action or other remedial steps against specific automakers whose recall
completion rates substantially lag behind the metrics established in
the Takata Orders?
Answer. NHTSA has been very supportive in encouraging automakers to
improve completion rates and has substantially contributed to and
driven success realized in transforming automakers' approaches to
automotive recalls. NHTSA can help to further improve recall completion
rates by continuing its support of the many ongoing recall initiatives,
and by continuing to foster the cross-industry collaboration that has
resulted. Where I observe an automaker with recall completion rates
substantially behind the metrics established in the Takata Orders, I
communicate to NHTSA the need for enhanced scrutiny and engagement and
NHTSA has supported and pursued heightened levels of engagement. I do
not make recommendations to NHTSA regarding enforcement actions.
______
Response to Written Question Submitted by Hon. Richard Blumenthal to
John D. Buretta
Question. As the Independent Monitor, what are you doing to ensure
the 2015 NHTSA preservation order continues, all documents are
preserved, and testing continues to protect the public in the future
for vehicles not yet recalled?
Answer. Takata and the Independent Testing Coalition continue to
test Takata inflators and I receive regular updates on the ongoing
testing. Any relevant observations with respect to the protection of
the public are communicated to NHTSA for further action. While the 2015
NHTSA preservation order is not within the scope of my authority as
Monitor, I have received information in that regard in the ordinary
course.
______
Response to Written Question Submitted by Hon. Maggie Hassan to
John D. Buretta
Question. This recall represents one of the largest and most
complicated in U.S. history. It is my understanding that this is the
Committee's third hearing on this topic since 2014. I am heart broken
when I think of the individuals who have lost their lives, and the
families that have been torn apart because of the short-sightedness
that put business and profits before human lives. What progress has
been made since the Committee's first hearings in 2014 with regard to
providing financial relief to those impacted by this tragedy and with
regard to getting this recall completed as swiftly as possible?
Answer. Automakers have evolved in their approaches to recall
engagement since 2014, when the primary recall strategy was sending
boilerplate, highly technical English language-only letters to affected
vehicle owners approximately every three months and automakers
generally relied on state Department of Motor Vehicles' registration
data for vehicle owner contact information. Today many automakers are
using a wide range of enhanced outreach strategies to improve
completion rates, such as: frequent, multi-channel outreach,
communications tailored to unique demographic attributes of unrepaired
vehicle owners, using additional sources for vehicle owner contact
information, refreshing those sources every few months, offering
services to minimize owner inconvenience such as free loaner vehicles
and mobile repair, engaging third parties to conduct recall outreach
and canvassing vehicle owners' homes, in-person, to notify them of the
issue and schedule repair appointments. Though automakers employ these
techniques to varying degrees and there remains much room for
improvement, automakers are increasingly embracing these techniques,
signaling a positive shift in the industry's approach to automotive
recalls. As detailed further in my November 2017 report, The State of
the Takata Airbag Recalls, even at the initial stages of
implementation, these strategies have doubled or tripled repair rates
for automakers that employ them.
Automakers are increasingly collaborating with one another to come
up with additional innovative recall techniques. Through the Summits
that I have hosted in coordination with NHTSA, automakers have
effectively cross-pollinated ideas for recall techniques and execution
methods.
With regard to providing financial relief to those impacted by this
tragedy, funds have been set aside in many Takata-related civil
settlements and in Takata's reorganization plan to ensure that those
impacted by this tragedy receive financial relief. Civil litigations
brought by those who have been injured or whose loved ones have been
killed by defective Takata inflators have resulted in the provision of
settlement funds to compensate these individuals. In the TK Holdings
bankruptcy proceedings, the Bankruptcy Court for the District of
Delaware has appointed Roger Frankel as legal representative for future
claimant creditors--individuals who may sustain personal injuries after
the bankruptcy filing arising from PSAN inflators manufactured by
Takata before its emergence from bankruptcy--to ensure the
reorganization plan provides adequate financial relief to such
individuals. The court also appointed Pachulski Stang Ziehl & Jones LLP
to represent a committee of unsecured tort claimant creditors, to
ensure the reorganization plan provides adequate financial relief to
individuals who currently hold personal injury claims against Takata.
The confirmed plan of reorganization sets aside funds to provide
financial relief for current, alleged and future personal injury and
wrongful death claims, through the PSAN PI/WD Trust. In addition, the
criminal settlement agreement between Takata and the U.S. Department of
Justice provides for the payment of $125,000,000 to individuals who
have suffered or will suffer personal injury caused by defective Takata
inflators.
______
Response to Written Question Submitted by Hon. Bill Nelson to
Joseph Perkins
Question. It has been reported that Key Safety Systems will acquire
almost all of Takata post-bankruptcy, except for certain assets that
deal with Takata's ammonium nitrate-based air bags. Those air bag
assets will be left in an entity that will be wound down in the near
future. Will that entity have sufficient funding to assist with the
production of replacement air bag inflators and maintain records and
expertise that may assist NHTSA and other interested parties as the
recall process moves forward?
Answer. There are no concerns with respect to the questions noted
above. First, given the transaction closure extended into April, all
inflator production in RTK (reorganized Takata) had been completed by
the April 10 close date. All replacement kits going forward will be
coordinated by JSS (Joyson Safety--Newco). The inflators fora these
kits will come from internal non PSAN production or from an outside
source (Autoliv, etc). Per the NHTSA consent order, testing and
engineering expertise remains in RTK and they will continue its regular
interactions with NHTSA. All records are maintained and available.
______
Response to Written Question Submitted by Hon. Richard Blumenthal to
Joseph Perkins
Question. Does Key Safety Systems agree to cooperate with all
requests with respect to document preservation?
Answer. Yes, JSS will maintain all relevant documents in our
possession.
______
Response to Written Question Submitted by Hon. Maggie Hassan to
Joseph Perkins
Question. This recall represents one of the largest and most
complicated in U.S. history. It is my understanding that this is the
Committee's third hearing on this topic since 2014. I am heart broken
when I think of the individuals who have lost their lives, and the
families that have been torn apart because of the short-sightedness
that put business and profits before human lives. What progress has
been made since the Committee's first hearings in 2014 with regard to
providing financial relief to those impacted by this tragedy and with
regard to getting this recall completed as swiftly as possible?
Answer. The JSS purchase of the non-PSAN assets of Takata was done
to protect the industry, preserve public safety with continued
production of replacement kits, and to save jobs that would have
otherwise been lost had Takata liquidated. We bring a strong compliance
approach and focus on quality. The DOJ plea agreement by Takata and
certain mechanisms in the closing of the transaction provide certain
funds for current and future victims. JSS is focused prospectively on
producing high quality products to meet the needs of the consumer.
______
Response to Written Questions Submitted by Hon. Todd Young to
Rick Schostek
Question 1. In your testimony, you highlight that Honda has been
relentless in contacting consumers to alert them to the roll call, and
note that you have a 72 percent completion rate that exceeds the
industry average. To what do you attribute this success? Have you
developed a message that you have found is particularly effective?
Answer. Honda has refined its outreach approach to focus not only
on the substance of its messaging to the consumer, but also on the
methodology used to find and communicate with the consumer.
Data integrity is a key foundation of any successful outreach
strategy. Honda works very closely with our data provider, IHS Markit,
to ensure that the customer data we are using is accurate.
This includes employing various data enhancement techniques as well
as refreshing the data on a frequent basis.
Honda works with NHTSA, the Takata Monitor and the industry in
continuously refining our recall messaging, and sharing outreach
strategies and best practices for effective messaging. This includes
the use of simple, easy-to-understand language that reinforces the fact
that the recall will be performed for free. The great bulk of Honda's
outreach also features bi-or multi-lingual messaging on consumer-facing
printed communications.
Honda's success comes from employing a combination of complementary
strategies rather than a single message or outreach tactic. This
includes, but is not limited to, the use of e-mail, text messaging,
online advertising and social media posts. This messaging is delivered
in a cadenced manner with varying messages and themes; for example, by
occasionally including imagery of injuries sustained as a result of a
ruptured inflator. Honda is constantly looking for creative ways to
reinforce its outreach at a local level through use of respected
sources to echo the importance of our recall message.
We have seen increased customer response, for example, when we
augment existing outreach with a message from the customer's state DMV
office. However, even that will not motivate many customers to seek
this important repair. That is why Honda is a strong proponent of
encouraging states to tie safety recall repair completion to vehicle
registration renewal. DMV tie-in could assure 100 percent of registered
vehicles are repaired within a single registration cycle--1 year in
most states; and more importantly, it would save lives.
Question 2. What lessons have you learned in the process of
developing communications to consumers that motivates them to act?
Answer. Honda has learned a significant amount during its outreach
activities for the Takata recall. Customers will respond to different
types of outreach in different ways, and there is no single outreach
method that will motivate all consumers to bring their vehicles in for
a repair. As outlined above, using accurate data, Honda continues to
reach out to consumers using simple and concise messaging that is
delivered across a wide variety of outreach tools.
Even employing this outreach together with other industry best
practices, Honda has seen diminishing returns. This led to Honda's
decision to conduct door-to-door canvassing for its highest risk
vehicle population, often referred to as Alpha VINs. In the last year,
Honda representatives have been knocking on the doors of every valid
address associated with an on-the-road Alpha VINs. That outreach
continues today.
Through Honda's combined outreach efforts to date, we have either
repaired or otherwise accounted for 1.03 million Alpha VINs, leaving
approximately 55,000, or 5.1 percent of the original population,
subject to ongoing outreach efforts. This has proven to be a
particularly challenging population, as even intense canvassing
throughout the last year, often involving multiple visits to each Alpha
VIN owner, has not yet motivates them to accept the repair. Frequently,
these customers feel they are too busy, or simply believe the problem
will not happen to them. In other cases, Honda has found that these
customers have avoided taking part in the recall as a result of a
perceived desire to avoid detection, often driven by personal or legal
concerns. These customers in particular have proven to be suspicious of
uninvited visitors offering free repair work on their vehicles. In a
number of cases, canvassers have even been threatened with violence,
which in some cases has required the involvement of local law
enforcement.
Within reasonable limits, considering the safety of our canvassers
first, Honda will continue to encourage these customers to avail
themselves of the recall remedy. It remains important to understand
that, despite the 100 percent completion target that NHTSA has
promoted, the auto industry possesses no enforcement capacity to compel
a customer to complete a repair.
Question 3. You also mention the importance of engaging other
stakeholders in helping the industry identify and notify customers with
outstanding airbag recalls. Can you tell me what successes you have had
in engaging with other ancillary industries that ultimately have a
touchpoint with consumers?
Answer. Honda has seen localized lift in repair rates when our
outreach efforts were supplemented by DMV outreach. For example, both
the District of Columbia and the State of Vermont advised vehicle
owners if their vehicle contained an unrepaired safety defect at the
time of a required vehicle inspection. In a separate pilot, the
District of Columbia's DMV actively supported a program to perform
Takata Recall repairs to coincide with those required inspections.
Honda is eager to broaden these efforts with additional state DMVs.
Honda also has had noteworthy success working with the insurance
industry. Over time, Honda has developed a relationship where most
insurance companies will permit repairs of salvage vehicles before
those vehicles are re-sold at auction. This avoids recalled airbags
from entering the secondary use market.
At the same time, Honda has so far been unsuccessful at encouraging
these same insurance companies to engage their policyholders by
reminding them to get this life-saving repair. To overcome insurance
company objections about data availability, the auto industry worked
together in the last year to create a bulk VIN recall lookup tool. This
tool provides a free single source for looking up open safety recalls
on large numbers of VINs from all OEMs. Honda will continue to engage
the insurance industry to look for creative ways we might work together
to improve completions in the future.
Honda also has worked with CCC, the industry leading supplier of
body shop estimating software, to raise awareness of this recall. When
an affected customer's VIN is entered into the collision estimating
system at a body shop that uses this software, body shop personnel will
be shown a pop up message that alerts them that the particular VIN has
one or more open safety recalls, including the Takata recall. A
printout of this message can then be provided to the customer
containing information on appropriate next steps to repair their
vehicle.
Honda believes that the most effective means of assuring the repair
of vehicles with safety defects is by tying vehicle repair to vehicle
registration. This is particularly important for the second, third or
fourth owners of vehicles who may not even be aware at the time they
purchase the vehicle that it contains an unremedied defect.
______
Response to Written Question Submitted by Hon. Bill Nelson to
Rick Schostek
Question. About sixty thousand vehicles nationwide--and over three
thousand in Florida--contain ``alpha'' inflators, which pose a fifty
percent risk of serious death or injury when they deploy. Have you
considered case bounties or just offering to buy these old vehicles,
which may not be worth much, to get them off the road?
Answer. With respect to vehicles believed still to be on the road,
Honda has employed a variety of strategies to encourage the completion
of open Takata inflator recall repairs. Since June 2016, Honda focused
over 9 million direct communications to its highest risk VIN
population, often referred to as ``Alpha'' vehicles, with the average
unrepaired on-the-road VIN receiving over 45 communications with
varying cadence and messaging. Further, in the past year, Honda took
the additional unprecedented step of performing door-to-door canvassing
of every Alpha consumer, with the goal of engaging them, understanding
their specific needs, and addressing those needs to accomplish the
recall.
When engaged with consumers regarding vehicles they still have, but
which no longer are on the road, Honda endeavors to do what is
necessary to repair the airbag inflator taking into account that
customer's needs. Depending on the particular circumstances, this has
included repairing vehicles expected to return to active service in the
future, purchasing the undeployed airbag inflator from vehicles not
expected to return to service, and in some cases offering to purchase
the whole vehicle. Where the vehicle is still on the road, we have
found it very often serves as an important means of transportation for
the customer's family, making vehicle disposal an unattractive option
compared to repair. For these consumers, Honda offers incentives to
meet their specific needs--most often towing, loaner vehicles, local
transportation (other than loaner cars) and on-site repairs.
______
Response to Written Questions Submitted by Hon. Richard Blumenthal to
Rick Schostek
Question 1. Last year, Takata signed a plea agreement with the
Department of Justice, which included the payment of a $25 million
criminal penalty, $125 million restitution for victims of defective
Takata airbags, and $850 million compensation fund for auto
manufacturers. Did Honda actively negotiate with DOJ to set the
restitution fund for OEMs at $850 million? Please provide copies of all
documents and submissions you provided to DOJ which may have been
considered in determining this allocation of restitution funds.
Answer. Honda fully cooperated with the Department of Justice in
its investigation of Takata, but did NOT negotiate or otherwise discuss
with DOJ the amount of the personal injury victim restitution fund or
the OEM victim restitution fund. As no negotiations with DOJ occurred,
there are no documents to share on this matter.
In addition to the $125 million Victim Restitution Fund, an
additional fund has been created through negotiations in the Takata
bankruptcy. That fund will provide at least an additional $130 million
to compensate individuals injured by Takata PSAN inflator and will be
administered by Takata Special Master Eric Green. In addition, and also
in conjunction with the Takata bankruptcy, Honda has committed to
ensuring that all Honda customers who have been injured due to a Takata
PSAN inflator are fairly compensated through an expedited process, also
administered by Special Master Green. Honda is presently the only OEM
that has made this commitment. Additional information about these funds
and claim processes is available at www.takataspecialmaster.com
Question 2. It is my understanding that the first incident
involving defective Takata airbags took place in May 2004 with a 2002
Honda Accord. The victim experienced severe lacerations on both her
chin and right side cheek as a result of the inflator rupture. When
Honda issued its first recall in 2008, Honda did not include
information about this event to NHTSA. It was not until September 2009
that Honda disclosed this first incident with NHTSA. Why wasn't this
inflator provided to Takata and NHTSA for inspection soon after the
incident? Why did it take until September 2009 for Honda to report this
event to NHTSA?
Answer. Honda did not wait until September 2009 to disclose this
incident to NHTSA. Honda promptly reported the 2004 incident under the
requirements of the TREAD Act in its Early Warning Report to NHTSA in
the 2nd quarter of 2004.
The reason the 2004 incident was not also included in the initial
2008 recall disclosure is because Takata had previously advised Honda
that the inflator rupture in 2004 was an ``anomaly.'' When Honda
learned of the 2004 rupture, it had little or no experience with
ruptures. In May 2005, Honda contacted Takata about the potential
causes of the rupture and provided photos of the ruptured inflator.
From these photos, Takata engineers concluded that deep and localized
rust inside the inflator had been present before the rupture, and they
believed this rust was probably caused by excessive moisture during
manufacturing or a leak in the inflator due to a compromised seal. The
inflator itself was not provided to Takata. To our knowledge, it has
not been preserved. However, Takata never advised Honda that it was
unable to evaluate the inflator from the 2004 event based on the photos
of the inflator alone. Takata searched its manufacturing records and
verified that the data showed no deviations from Takata's manufacturing
specifications. In addition, Takata had seen no other ruptures in the
field, and it would be another three years before another took place.
After the 2007 and 2008 ruptures, Takata believed it had pinpointed
the problem--it identified a five-week period when its propellant may
have been manufactured improperly. The inflator from the 2004 incident,
however, used propellant that had been manufactured ten months after
the time period in question. Additionally, as discussed above, Takata
told Honda in 2007 that the 2004 event inflator ruptured due to
``anomalies'' that had nothing to do with the issues that led to the
2008 recall. Honda had no engineering basis to include the 2004 event
in its reporting of the 2008 recall to NHTSA.
In July 2007, after three additional ruptures in the field had been
reported, Honda initiated a thorough review of the issue. These
ruptures occurred in vehicles that were at least six and a half years
old at the time of the incident, and all involved inflators that were
manufactured within three weeks of each other. In August 2007, Takata
presented a tentative conclusion to Honda that ``we likely have a
cluster of events (the 2007 ruptures) from a common cause and an
isolated incident (the 2004 event).''
Takata based its recommendations about the initial November 2008
recall on its conclusion that the ruptures were caused by manufacturing
defects in a brief period of propellant manufacture (October through
December 2000). The propellant used in the inflator that ruptured in
2004 was made in October of 2001. The logical conclusion, based on the
information available at the time, was that the 2004 event was not
related to the recall defect, but instead occurred due to a compromise
of the seal. As such, the 2004 event was not relevant to the recall and
should not have been referenced as a related field event.
In June 2009, after additional ruptures in the field, Honda
expanded its Takata airbag recalls, following Takata's disclosure that
PSAN propellant manufactured from the start of production through
February 2001 was incorrectly manufactured to below-specification
density (low-density propellant). This recall covered inflators
containing propellant manufactured up until February 2001. It therefore
did not include inflators with propellant manufactured in October 2001
(the 2004 event inflator). Because the cause of the 2004 event was not
viewed as related to the low-density propellant defect, neither the
event nor the manufacturing period was relevant to the recall.
After the June 2009 event, Honda and Takata continued their root
cause investigation. In August 2009, Takata again concluded that the
event in 2004 was caused by a different problem than later events.
Takata provided Honda with four reasons for this conclusion: (1) The
inflator at issue in the 2004 rupture was only two and a half years
old, while the other ruptures involved much older inflators; (2) Unlike
other inflators, the inflator in the 2004 rupture had deep localized
interior rust, which suggested a compromised seal; (3) The propellant
manufactured at the same time as the 2004 event propellant was
manufactured according to specifications and performed properly in
recovered inflators when deployed; and (4) Takata was able to replicate
the 2004 event inflator rust and corrosion by testing an inflator with
an intentionally compromised inflator seal.
You are correct to point out that in September 2009, as part of a
response to a NHTSA Recall Query, Honda again referenced the 2004
event. NHTSA initiated the Recall Query to determine whether the scope
and timing of the 2008 and 2009 recalls were appropriate. This was the
second time NHTSA was told of the 2004 event. Before the Recall Query
was completed, Honda expanded the recall again because Takata could not
ensure that additional ranges of propellant were manufactured to the
correct density. This expanded recall in February 2010 included the
manufacturing range of the propellant in the 2004 event inflator, but
was not conducted because of concerns that the 2004 incident, by
itself, signaled a problem in those inflators. NHTSA, aware of the
three recalls and the 2004 event, concluded that the timing and the
scope of the recalls were appropriate.
Finally, in evaluating Honda's decisions about Takata's airbag
inflators equipped with Phase Stabilized Ammonium Nitrate, it is
important to remember that Takata concealed critical test data from
Honda during the development of these inflators and during the
investigation into ruptures. As Takata has admitted in a criminal
guilty plea, Honda would not have installed these inflators in its
customers' cars if Takata had disclosed this information. If this
information had been disclosed to Honda in May 2005 or in 2007 when the
investigation began, the recall history above would have been vastly
different.
______
Response to Written Questions Submitted by Hon. Maggie Hassan to
Rick Schostek
Question. 1This recall represents one of the largest and most
complicated in U.S. history. It is my understanding that this is the
Committee's third hearing on this topic since 2014. I am heart broken
when I think of the individuals who have lost their lives, and the
families that have been torn apart because of the short-sightedness
that put business and profits before human lives. What progress has
been made since the Committee's first hearings in 2014 with regard to
providing financial relief to those impacted by this tragedy and with
regard to getting this recall completed as swiftly as possible?
Answer. Significant progress has been made in both of the areas--
providing financial relief and recall completion--that are the subject
of this question.
As to the former, Honda can point to several important developments
that have made financial relief more available to consumers impacted by
the Takata airbag recall, including those that have suffered injuries
resulting from Takata airbag ruptures. First, on February 27, 2017,
Takata Corporation entered into a plea agreement with the United States
in connection with charges relating to certain of its airbags. The plea
agreement created a $125 million restitution fund for persons who have
suffered or will suffer wrongful death or personal injury caused by the
malfunction of a Takata airbag inflator. The Takata Victim Restitution
Fund is administered by Takata Special Master Eric Green.
An additional fund also has been created through negotiations in
the Takata bankruptcy. That fund will provide at least an additional
$130 million to compensate individuals injured by Takata products and
also will be administered by Special Master Green. In addition, and
also in conjunction with the Takata bankruptcy, Honda has committed to
ensuring that all Honda customers who have been injured due to a Takata
PSAN inflator are fairly compensated through an expedited process, also
administered by Special Master Green. Honda is presently the only OEM
that has made this commitment. Additional information about these funds
and claim processes is available at www.takataspecialmaster.com.
Finally, on or about February 28, 2018, Honda entered into
settlement of the economic loss class action claims in the
multidistrict litigation captioned In Re: Takata Airbag Products
Liability Litigation, No. 15-MD-2599-FAM (the ``MDL Settlement''). The
MDL Settlement was valued at $605 million and includes a number of
different components, including an Outreach Program, a Rental Car/
Loaner Program, and a claims process that allows customers to submit
claims for cash payment for out-of-pocket losses.
Turning to the second topic of the question, recall completion,
Honda again is able to report significant progress. Specifically, Honda
has the highest Takata recall completion percentage in the industry
and, perhaps even more significantly, that completion percentage has
been achieved on industry-leading volumes of airbag inflator repairs.
These repair statistics have come as a result of hard work and
ingenuity by Honda and its associates. The foundation of Honda's
strategy is a multi-channel outreach program that thus far has produced
over 160 million Takata recall-related communications to affected
customers. Honda has learned that its customers sometimes respond
differently to distinct modes of communication, so its outreach is
comprised of a varied mixture of mail, telephone, e-mail, SMS message
and social media communications. The messaging, normally provided in
multiple languages, emphasizes both the urgency of the recall and the
availability of a free repair.
Honda has instituted a number of programs designed to maximize
customer participation in the recall remedy. To that end, Honda has
instituted a loaner car program for customers needing alternative
transportation while their vehicle is being repaired. Vehicle towing
also is an option in many cases. Perhaps most noteworthy, Honda has
instituted a nationwide canvassing initiative targeted to its highest-
risk vehicle populations. To date, Honda canvassers have made over
600,000 in-person visits to owners associated with its Alpha vehicle
population. The scope of the canvassing program has just been expanded,
and Honda anticipates that this will have an additional positive impact
on its completion percentage. Honda also has begun supplementing some
of its canvassing teams with trained technicians that, where feasible,
offer the possibility of completing an on-the-spot repair at the
customer's home or place of business.
Honda has employed a number of other innovative tactics in support
of its Takata recall program. By partnering with certain auction
services, Honda has devised new ways to repair recalled vehicles
registered to insurance companies. Honda likewise has made efforts to
increase awareness among independent repair businesses and collision/
body shops so that, where appropriate, personnel from these aftermarket
sources can promote the recall to their customers. Honda also has
worked with several state DMVs to leverage their stature in
underscoring to Honda customers in those states the importance of
having the recall completed. These activities are emblematic of Honda's
commitment to the Takata recall and, more fundamentally, to the safety
of its customers.
Question 2. I have heard from the auto industry that one major
issue with implementing a recall of this magnitude, is waiting for
replacement parts. Is this actually the case, and if so, what more can
be done to ensure manufacturing and shipment of replacement parts is
occurring as quickly as possible?
Answer. Honda has worked very closely with suppliers of airbag
inflators in the industry to ensure there is a sufficient supply of
inflators available within its parts supply chain. The result of these
efforts is that Honda has not experienced a back order on a driver's or
passenger's side inflator since October of 2016. Honda's ``decision to
act quickly and comprehensively to find a solution'' to the Takata
airbag crisis was recognized in a recent article published in
Automotive News: ``Once it was clear the Takata episode was going to
affect numerous brands across the industry--thus putting a strain on
supplies of inflators--Smith pushed Honda to pursue buying additional
inflators from new suppliers and helped get those companies online with
Honda's supply chain.'' Bruce Smith Named Automotive News All-Star, at
http://www.autonews.com/article/20171126/OEM02/171129908/bruce-smith-
all-star-service-and-parts-honda (Nov. 26, 2017). The Automotive News
article is enclosed herewith for reference.
Honda does not anticipate any issues with inflator parts supplies
that would inhibit its customers from receiving the appropriate repair
for any vehicle involved in the Takata recall.
Question 3. Another, more pressing issue with the recall it seems,
is the difficulty people in my state and across the country have in
getting an appointment at a dealer or repair center that works with
their schedule. While getting car parts is a problem for the
manufacturer, dealer recall appointment schedules seem to be a problem
for everyone. What specific steps are you taking to make this process
easier for all recalls?
Answer. Honda has taken a number of steps to facilitate prompt
Takata recall repairs for consumers. First and foremost, Honda acted
early to secure a robust supply of replacement parts, as detailed in
Honda's response to the previous response. Honda also focused its
attention on assuring the robustness of our foundational business
processes, for example, by lowering the minimum age for loaner car
eligibility and assuring our scheduling system prominently presents
open safety recall information to the consumer, thus encouraging the
repair. Honda also educated its dealer body to prepare them for added
workload; in response, many dealers of their own initiative took
additional steps based on their local needs, including adding personnel
as needed and offering extended business hours and--in some cases--
special weekend repair days.
Honda monitors a number of feedback channels, including our
Customer Relations department, Dealer feedback, daily repair volume,
parts supply and mystery shopper calls, among others. While appointment
availability might be a challenge for some manufacturers, our customer
feedback demonstrates that Honda is able to meet customer recall
appointment scheduling expectations--and has been for some time.
______
Response to Written Questions Submitted by Hon. Todd Young to
Desi Ujkashevic
Question 1. In your testimony, you highlight that you are working
closely with NHTSA and the Monitor to implement best practices to
encourage consumers to replace their airbags. You also note that you
are using data analytics to study the effectiveness of various
approaches to accomplish that task. What lessons have you learned as a
result of your data analytics?
Answer. The use of data analytics is ongoing and new information is
identified by the monitor, other OEMs and Ford as the recalls progress.
Some of the key learnings from the use of data analytics include:
Segmentation of recall populations (older vehicles, customer
demographics, geographic influences (e.g., urban and rural customer
locations) require different owner contact approaches to be effective
Identification of vehicles that are currently owned by a subsequent
owner (sometimes the third or fourth owner) and vehicles that are no
longer in service
Analysis of different types of notification (i.e., e-mail, phone
calls, first class mail, FedEx packaging, post cards, etc.) and the
frequency of notification for optimal methods to cause different owner
populations to respond to the recalls
Question 2. Has Ford consulted behavioral economists to help
understand that data and more effectively tailor a message? If not, do
you believe a behavioral economist might play a constructive role in
developing a more effective message?
Answer. The Takata Independent Monitor has employed a number of
resources to consult with the OEMs including experts on integrated
marketing communications programs and all aspects of digital, social
and mobile media strategy, development and execution. Feedback from
those experts has been provided to all of the OEMs and their guidance
is being implemented in customer outreach messaging, including owner
letters, social media outreach, and targeted experiential events as
examples. Ford is also using its sales marketing partner to identify
and coordinate messaging in customer outreach for the recall
notifications.
Question 3. Has Ford had success engaging with other ancillary
industries that have a touchpoint with consumers?
Answer. Ford, along with all of the affected OEMs, are using
unprecedented outreach methods for the Takata related recalls. Some
examples of those include mobile repair services, salvage yards and
auto auctions, automotive insurance companies, automotive finance
companies (e.g., Ford Motor Credit), enthusiast groups (e.g., Mustang
Clubs of America) and private repair facilities such as body shops to
make sure customers are aware of the recalls and the importance of
having the recall repairs completed. Also, some state motor vehicle
authorities are allowing OEMs to coordinate messaging in their
facilities (e.g., video messaging in waiting areas, and letters to
customers with government agency letterhead).
______
Response to Written Questions Submitted by Hon. Bill Nelson to
Desi Ujkashevic
Question 1. The two deaths caused by rupturing Takata inflators in
Ford Rangers reveal that just one day of production at Takata can be
fatal. How can Ford be sure that other vehicles will not need a ``do
not drive'' warning?
Answer. Ford and Takata, in coordination with NHTSA, continue to
test parts returned from the field. To date all of the inflators that
have demonstrated an elevated risk of rupture for special causes
outside the commonly accepted causes associated with exposure to
moisture, high temperature cycling, and time in service have been
addressed. As we have shared with your staff, if additional data is
identified that suggests additional action should be taken, we will.
Question 2. Ford has identified three injuries caused by rupturing
Takata airbags in 2005-2007 Ford Mustangs--two of which occurred in
Florida. Can you describe these injuries, and should drivers of these
vehicles stop driving them until they are fixed?
Answer. The injuries reported to Ford were non-life threatening.
Based on data available to Ford, we believe the cause of rupture in
these three Mustangs is the same condition affecting the broader
population of recalled Takata inflators; namely exposure to moisture,
high temperature cycling, and time in service. While no special causes
have been identified in this population of inflators, we will continue
to monitor all field and test data and make adjustments as necessary.
______
Response to Written Questions Submitted by Hon. Richard Blumenthal to
Desi Ujkashevic
Question 1. Please document all injuries that have occurred due to
defective Takata airbags in Ford Rangers.
Answer. As you are aware, there are two fatalities attributed to
the single stage driver inflators in two 2006 model year Ford Rangers.
On April 28, 2018, NHTSA informed Ford of an event that occurred in
March 2017 involving a 2006 Ford Ranger where the driver reported an
injury to their chest from an inflator rupture.
Question 2. I understand that Ford is a member of USCAR--the United
States Council for Automotive Research. USCAR has a specification for
airbag inflators called USCAR-24, Inflator Technical Requirements and
Validation Specifications. When did USCAR first begin developing these
specifications?
Answer. Ford believes that development of the USCAR specifications
began in 1999.
Question 3. Did Takata inflators used by Ford deviate from USCAR-24
specifications?
Answer. As Ms. Ujkashevic testified, ``The Takata air bag inflators
that are being discussed did not deviate to the USCAR spec that would
be relevant in the context of the deployment disruptions.''
Question 4. When does USCAR anticipate it will have updated
inflator specifications and do you expect updated standards would allow
for the use of ammonium nitrate?
Answer. There is not an established completion target for the USCAR
updates. The specification is a performance based specification, not a
design directive; however, Ford is not currently utilizing ammonium
nitrate as a primary gas generate in current production vehicle airbag
inflators and has no plans to do so in the future.
Question 5. We know that Honda vehicles with so-called ``Alpha''
inflators, found in certain 2001-2003 Honda and Acura models, have an
alarming rupture rate of as high as 50 percent, according to NHTSA and
Takata. Mr. John Buretta, the Independent Monitor of Takata, has
documented in his 2017 report that such statistics can be helpful in
conveying to consumers the importance of repairing open recalls. Do you
have similar failure rate statistics that you can share with consumers
regarding the Ford Rangers, and, if you do not, when do plan to have
such statistics?
Answer. Ford is continuing to analyze and compare the potential
rupture rate in the Honda ``Alpha'' population and our ``Do Not Drive''
population. If we identify a similar failure rate projection, we would
certainly use that to help motivate owners to have their vehicles
repaired. We are concerned that if the projected rupture rate of the
``Do Not Drive'' population is lower than the ``Alpha'' population,
owners might take that to mean the risk is lower and somehow
acceptable. Whatever the projected rupture rate is in the ``Do Not
Drive'' population, it is unacceptably high and we want all owners to
stop driving their vehicles and have the Takata air bag inflators
replaced now.
______
Response to Written Questions Submitted by Hon. Maggie Hassan to
Desi Ujkashevic
Question 1. This recall represents one of the largest and most
complicated in U.S. history. It is my understanding that this is the
Committee's third hearing on this topic since 2014. I am heart broken
when I think of the individuals who have lost their lives, and the
families that have been torn apart because of the short-sightedness
that put business and profits before human lives. What progress has
been made since the Committee's first hearings in 2014 with regard to
providing financial relief to those impacted by this tragedy and with
regard to getting this recall completed as swiftly as possible?
Answer. Our sympathies go out to those individuals who have been
injured and the family of those who lost loved ones as a result of
Takata air bag inflator ruptures.
Ford is taking extraordinary efforts to encourage all owners with
defective Takata air bag inflator to have their vehicles repaired.
While the normal recall letter mailings continue to be effective in
driving increased completion rates, we are reaching owners in a number
of creative ways including:
Outbound live phone calls--we are adding Call Center Agents
to enable 1 million outbound calls per year
Certified letter with surveys to help us assess what type of
outreach is most effective
Facebook targeted campaign
Pandora targeted campaign
Owner letters including additional languages in targeted zip
codes
Engaging the nationwide network of Mustang Owner Clubs
We are also offering rental vehicle assistance for those owners who
need alternative transportation to have their vehicles repaired or
those who are waiting for replacement parts.
For the 2006 Ranger population affected by the ``Do Not Drive''
order, we have made eight contacts per vehicle on average including:
US Mail--110,000
E-mail--44,000
Robo Calls--43,000
Live Phone Calls--41,000
Text Messages--11,000
We continue to use new sources of customer contact data to help us
identify current owners. We are providing additional incentives to
dealers to expand their efforts to complete the recall including
financial incentives that help dealers reach into their local
communities to find these inflators, competitive assessments to
motivate dealers to understand opportunities to complete recalls, and
providing a dealer dashboard to help them track their successful
efforts to complete the recall. Ford is also using advanced data
analytics tools to help target specific populations that need
additional help to complete the recall.
We are investigating other outreach actions including canvassing,
mobile repairs, using independent service repair providers in more
remote locations, and salvage yard recovery of recalled inflators.
Question 2. I have heard from the auto industry that one major
issue with implementing a recall of this magnitude, is waiting for
replacement parts. Is this actually the case, and if so, what more can
be done to ensure manufacturing and shipment of replacement parts is
occurring as quickly as possible?
Answer. While Ford cannot speak for other manufacturers, Ford's
approach to the remedy parts for these recalls is to develop solutions
that do not use ammonium nitrate. This approach requires identifying
non-ammonium nitrate based inflators that provide adequate protection
to vehicle occupants. In some instances alternate inflators have been
identified that can be modified slightly to perform with the existing
airbag cushion and vehicle system. In other instances, an inflator-only
solution could not be identified, and a new inflator and airbag module
system were developed. Ford's approach to developing the recall remedy
parts is to work with existing suppliers to identify potential
solutions that are then completely tested and validated through Ford's
processes to ensure the remedy parts perform as required and provide
adequate occupant protection. Ford worked with (and continues to work
with) the existing inflator supply base to identify remedies that also
have adequate production capacity available. In some instances, Ford
pre-purchased production capacity at suppliers before a remedy part was
finalized to ensure that parts could be expeditiously produced when a
solution was identified. Ford continues to work closely with the
suppliers to expedite parts to customers within the limits allowed by
regulation of shipping hazardous material.
Question 3. Another, more pressing issue with the recall it seems,
is the difficulty people in my state and across the country have in
getting an appointment at a dealer or repair center that works with
their schedule. While getting car parts is a problem for the
manufacturer, dealer recall appointment schedules seem to be a problem
for everyone. What specific steps are you taking to make this process
easier for all recalls?
Answer. Ford is working closely with its dealer network to identify
and implement processes to reduce the inconvenience to customers.
Examples of actions to date include providing shuttle services for
owners, and providing loaner or rental vehicles to owners while their
vehicle is being serviced. Ford is asking dealers to consider
conducting weekend airbag replacement events to improve owner
convenience. Finally, Ford is exploring the use of mobile repair
service and Independent Body Shop support to complete repairs where
driving distance or drive time makes it difficult for owners to get to
a dealership to have airbags replaced. If someone is struggling with
setting an appointment, we encourage them to contact our Customer
Relationship Center.
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