The auto industry, especially in the United States, will forever remember the year 2016 for what the NHTSA has referred to as “the largest and by far the most complicated vehicle recall in United States’ history.” Takata, a now infamous motor vehicle parts supplier, is single-handedly responsible for the crisis after it was discovered that they had installed defective airbags that could potentially explode during deployment, injuring or even killing vehicle occupants.
A staggering 34 million vehicles from 14 car manufacturers that have been affected were all manufactured between 2002 and 2015. Even after ten deaths and more than 100 hundred injuries in the US were linked to this problem, the US government took a couple of years to ultimately diagnose the problem and push for recalls. According to NHTSA, the airbag explosion sprays metal shrapnel throughout the passenger cabin due to a technology that erroneously fails to use a chemical drying agent on ammonium based propellants.
So far, the latest confirmed casualty of this disastrous outcome from a supposedly life-saving device is a 17-year-old Texas girl, who drove a 2002 Honda Civic. A postmortem examination revealed that she tragically died after shrapnel fatally hit her neck. As a response to such incidences, NHTSA imposed a civil penalty of up to $200 million on Takata– with $130 million of that applying in case the company fails to meet its commitments, and the rest being handed over as a cash penalty.
The issue, which has been in the headlines for a couple of weeks now, has elicited mixed reactions from both consumers and the vehicle manufacturers. While many applaud the move, others are still worried about other equally disastrous defects in today’s vehicles that are yet to be discovered. All in all, it is an eye-opening experience for Americans, with the following solid lessons to take home:
Private Sector Supply Chain Systems Are Sometimes Not As They Seem
With a crisis that spans to tens of millions of vehicles, it is understandable that NHTSA took over the responsibility of commandeering and overseeing the entire recall and replacement process. They probably find it incredibly hard to trust deceitful corporations with a process that could cost them billions of dollars in losses.
Technically, the process would have been a lot easier had there been a solid supply chain framework. The NHTSA is currently facing difficulties coordinating the process across all the states and tracing the actual model numbers that are affected. As a result, the process is proceeding at a painfully slow pace, and could potentially spread to other vehicles, consequently raising the number even further. With a solid supply chain process, identifying all the vehicles affected and the subsequent costs would have been considerably easier and less cumbersome.
Is Japan Still a Global Leader in Quality and Innovation?
For decades, Japan has been considered a global leader in quality production and innovation. At their peak, Japanese manufacturing companies were doing amazingly well on the stock market, and its banks occupied all the top ten biggest banks slots.
After the real estate and stock market burst of 1990, the country’s economy sunk and has yet to recover. What is now considered their golden goose, car manufacturing companies are now succumbing to increased pressure and losses due to revelations not only in the West but also in Asian countries. Honda, Toyota, Mitsubishi and now Takata have all been at the receiving end, and it is only time before they probably started losing out to other Asian brands- just like Sony Corp, which was ultimately overtaken by South Korea’s Samsung Electronics Co.
Finally, all facts considered, the biggest lesson is this: always conduct comprehensive research on various vehicle models and get the auto experts to perform checks before eventually making a purchase. You never know- something as simple as a glance under the dashboard could make the difference between life and death.