Takata criminal probe shifted to Detroit prosecutors

David Shepardson and Melissa Burden
The Detroit News

Washington — Federal prosecutors in Detroit are taking the lead in the Justice Department’s criminal investigation into air bag defects linked to six deaths and more than 100 injuries as major automakers continue to race to identify the millions of additional vehicles must be fixed in the largest recall in U.S. history.

Japanese air bag manufacturer Takata Corp. said Tuesday it was declaring 33.8 million vehicles defective in a move that will lead to the largest auto recall in U.S. history — about twice the 17 million vehicles called back by 10 major automakers since 2013.

The intense public interest in the issue led record traffic and sporadic outages at the National Highway Traffic Safety Administration’s website as more than 50 times the normal number of owners sought to check to see if their vehicles have been recalled.

But it won’t be until next week at the earliest that the additional 17 million vehicles are identified — and could be months or years before enough replacement parts are built to complete the repairs for air bag inflators .

The Detroit News has also learned that the settlement came after intense talks between NHTSA and Takata that began in mid-April when Takata made a proposal aimed at ending the stand off. That proposal was followed by a meeting between NHTSA and Takata officials in Washington, including Takata’s chairman and CEO Shigehisa Takada, a person close to the company said.

But the final deal was hammered out after weeks of talks between lawyers, a deal was reached Friday in what may be the largest ever consumer recall in history. NHTSA was considering a series of options if Takata had failed to act. NHTSA Administrator Mark Rosekind on Tuesday wasn’t specific but said the agency was preparing to act unilaterally if necessary.

Takada, the company’s CEO, said in a statement Tuesday the deal “presents a clear path forward to advancing safety and restoring the trust of automakers and the driving public.

Takata said it will be producing 1 million inflators a month by September, which means enough replacement parts could be on hand in about two years. Takata’s stock fell 10.2 percent in Japan, Wednesday.

Owners have little recourse but to wait months or years to get replacement parts. Automakers will prioritize repairs in high humidity areas where risks are believed to be the greatest. Still Takata and NHTSA don’t know the root cause — and a working group of 10 automakers assisted by Orbital ATK is working to get to the root cause.

Rich Newsome, an attorney representing seven victims of faulty Takata air bags, said “lawmakers and manufacturers still need to enact serious and lasting changes to our nation’s recall procedures to prevent crises like this one from occurring again.” Lawyers will begin taking sworn statements this month in a bid to “uncover answers about the root cause of the defect and exactly what Takata knew and when they knew it.”

Takata’s North American headquarters is in Auburn Hills. The criminal case still appears to be in its early stages and in recent weeks, prosecutors in Detroit have been holding meetings about the investigation. Federal prosecutors have obtained the 2.5 million pages of documents that Takata has turned over to NHTSA in recent months, lawyers say.

“We can confirm that the U.S. Attorney’s Office for the Eastern District of Michigan and the Department of Justice’s Criminal Division, Fraud Section, are jointly handling the criminal investigation into Takata,” said Gina Balaya, a spokeswoman for the office said.

And Takata’s decision — announced five months after NHTSA and many members of Congress had urged them to act — left many demanding further action.

“The American people should not serve as crash test dummies for Takata. It’s time for Takata to work with regulators to solve these safety issues immediately,” said Sen. Dean Heller, R-Nev.

Kevin Pollack, vice president of recalls for Stericycle ExpertSOLUTIONS, a company that helps manage recalls for manufacturers and parts suppliers, said NHTSA, auto manufacturers and parts suppliers want to get the defective air bag inflators out of cars and get vehicles back on the road as quickly as possible.

“The problem they’ve got with something this scale really breaks into three pieces. One is the parts availability. They weren’t sitting on a stockpile of 30 million additional air bag inflators,” he said in an interview. “Two is the capacity of their dealers to be able to actually do their repairs if the parts are available. The dealers weren’t necessarily geared up to do 30 million repairs above and beyond their normal work. And three is overcoming consumer apathy, to actually convince them to bring their automobiles in and have the repair done.”

Honda Motor Co., which first began recalling vehicles with Takata air bags in 2008 and has the most vehicles involved -- including all of the reported deaths linked to the issue -- has provided nearly 60,000 loaner and rental vehicles to customers whose vehicles received Takata air bag inflator fixes, Honda spokesman Chris Martin said in an email.

Experts say automakers will face difficulty to convince nearly 34 million owners to take vehicles in for repairs.Auto website Autotrader says most owners don’t take recalls very seriously.

Autotrader research shows that if owners are aware of a recall on their vehicle, only 56 percent take it in for repairs every time.

Only 61 percent of owners work to stay informed about recalls on vehicles they own, and only 35 percent research recalls when shopping for a vehicle to purchase.

NHTSA website has sporadic outages after Takata recall

The National Highway Traffic Safety Administration’s web traffic hit an all-time record Wednesday after the government announced Takata Corp. was declaring nearly 34 million vehicles defective — a move that will prompt the largest vehicle recall campaign in U.S. history.

After getting more than 50 times normal traffic Tuesday and Wednesday, the government’s website has reported some sporadic outages in some functions. The site was down for days last year, after millions of vehicles for Takata air bags were recalled.

NHTSA spokesman Gordon Trowbridge said NHTSA’s website received an all-time high 598,000 lookup requests for vehicle identification numbers to determine if a car or truck has an uncompleted recall as of 4 p.m. Wednesday — after a previous record 571,000 on Tuesday.

“For comparison’s sake, the daily average for May 11-14 was 9,600 searches. Our all-time previous record was just over 100,000 searches. We nearly topped that daily record in our busiest 30-minute period yesterday, receiving about 90,000 requests at peak,” he said.

Trowbridge said NHTSA is “making additional changes overnight to add capacity.” Many U.S. senators urged owners to go to the site to check to see if their vehicles are covered.

David Shepardson