Airbag Explosions: Independent Takata Corp Quality Assurance Panel (‘Skinner Panel’) Reports
The deaths of 10 people and 139 injuries worldwide have been linked to defects in motor vehicle airbag inflators made by Japanese supplier Takata Corporation, one of the world’s largest manufacturers of vehicle safety devices. The inflators disintegrated, sending high energy debris towards the vehicle occupants. The first known incident occurred in 2003 in Switzerland. Since 2008, more than 40 million vehicles have been recalled worldwide for maintenance action (half in the US).
The US National Highway Traffic Safety Administration (NHTSA) only opened an investigation in 2014, ten years after the first explosion in the US. There was strong criticism of their vigilance (which we discussed at the time: US Vehicle Regulator in Firing Line). They then rapidly imposed a $200 million civil penalty, the largest in their history, on Takata for violations of the National Traffic and Motor Vehicle Safety Act. Later NHTSA fined Takata further for not cooperating. More recalls have been initiated in the last few day by Daimler and VW. A good summary of the saga can be found here: Massive Takata Airbag Recall: Everything You Need to Know
The Skinner Panel
In late 2014, to supplement other investigations into these occurrences, Takata commissioned the Independent Takata Corporation Quality Assurance Panel to “conduct an unbiased review of Takata’s quality-related practices”. The review was billed as being forward looking, not a response to the past incidents. The Panel was chaired by former US Transportation Secretary Samuel Skinner, who appointed 6 other distinguished panel members (all American) in January 2015. This follows past precedents such as the Baker Panel after the 2005 BP Texas City Explosion, the Toyota North American Quality Advisory Panel, led by another former US Transportation Secretary Rodney Slater which reported in 2011 on a series of unintended acceleration accidents and the 2014 Valukas report for General Motors (which we covered in GM Ignition Switch Debacle – Safety Lessons). The Panel’s mission was also very US centric, concentrating on the airbag-inflator operations of TK Holdings Inc, Takata’s North American subsidiary, to:
…review and assess Takata’s current policies, practices, procedures, structure and personnel to ensure that, going forward, Takata is fully and promptly responsive to the traveling public, the US Department of Transportation, the National Highway Traffic Safety Administration, other regulators, and the OEMs— whenever questions are raised about the quality or safety of Takata air bags.
QA Review Panel Conclusions
The Panel published its report on 2 February 2016 and has concluded that:
…Takata must make significant improvements across the quality spectrum and, in particular, in three broad areas: (1) addressing quality-related concerns; (2) ensuring quality in Takata’s design and manufacturing processes; and (3) promoting quality through improved management practices.
The panel recommended the following in each area (with our comments and selective quotes are in italics):
(1) Addressing Quality-Related Concerns
- Refine the approach to monitoring in-fleet product performance: Currently some tasks are split between a safety team and a warranty team with no data trending. It is suggested Takata buy older cars that are to be scrapped to examine the airbags.
- Ensure quality and safety concerns can stop product development: While they can stop production they cannot veto design reviews currently. The Panel also say: “Takata should strive to have only the best and brightest on its quality teams”.
- Ensure that data from quality performance testing is recorded and reported accurately: It seems there has been testing recording and reporting ‘inaccuracies’ in the past. The Panel do not elaborate but allegations have been made in the press: Takata Saw and Hid Risk in Airbags in 2004
(2) Ensuring Quality In Takata’s Design And Manufacturing Processes
- Develop a Takata standard for product safety specifications: Currently most tests are conducted to customer specifications not any kind of internal standard based on Takata’s own specialist expertise.
- Adopt a standard practice for seeking and utilizing third-party review: While 3rd parties have been consulted in the past, the Panel suggest a more systematic approach.
- Increase and standardize automation operations across facilities: In particular the Panel note much propellant is hand loaded. They say: “There are significant process checks in place to protect against human error during the propellant loading process, such as the use of pre- and post-loading weight checks and other process controls, but, in the Panel’s judgement, this is an area where automation is likely preferable”.
- Reduce the incidence of conditional approvals in the design review process: These are when a product passes a design review ‘gate’ with open issues. They say: “Takata needs to create a culture where conditional approvals are viewed as exceptional and where they are resolved as efficiently as possible. Takata also needs to identify why conditional approvals have become so prevalent and alter that problem-creating dynamic.”
- Involve manufacturing earlier in the product design process: Not only are they involved too late and unable to influence the design for manufacturability, the company has limited prototyping capability too.
- Ensure the design review process is outcome driven: They say the “process appears to be more of an exercise in completion than a rigorous quality evaluation”. While a 100 people might be invited, attendances are typically half a dozen and not necessarily the right combination of expertise and authority.
- Establish lifetime ownership over Takata product programs: There is no ownership of in-service issues.
- Increase consistency in monitoring and documenting critical specifications and processes: For example: “when reviewing engineering drawings at one of Takata’s plants—a drawing for an airbag diffuser—the Panel’s staff found that the ‘critical specifications’… were not defined”.
(3) Promoting Quality Through Improved Management Practices
- Cultivate a quality culture at Takata: The Panel say: “It is unlikely that even the most herculean isolated efforts to improve quality at Takata will succeed unless there is an accompanying shift in Takata’s culture”. The Panel suggest (rather unimaginatively) periodic quality training, (perhaps more productively) assignment to quality projects and (repeating an earlier comment) recruiting the top talent into quality.
- Increase leadership support for and involvement in quality initiatives: The Panel says that “there is more Takata’s leadership can do to improve the company’s quality culture”. They extol “leading by example and giving credit where credit is due on cultural issues” and being more involved in design reviews (for example).
- Link quality performance and compensation at the individual level: Perhaps not surprising in a US-centric review the Panel suggests financial rewards for quality, perhaps sending the conflicting message that quality is simply a bonus and not a core part of performance. They do not consider if bonuses in other areas have been or could be counter-productive.
- Guarantee sufficient resources are available to support quality: “There is no substitute for allowing sufficient time to focus on quality issues and sufficient funding to ensure that the right people are hired and appropriately trained.”
Additional QA Review Panel Recommendations
As well as commenting on the regulatory environment and the difficulty of actually conducting successful recalls the Panel discusses:
Ageing vehicles: The panel also suggests more attention on vehicle ageing, as more durable vehicles are now staying in service longer, and service life limits for safety critical components.
Supplier-customer relationships: “The Panel recommends that suppliers and manufacturers work together to standardize safety system design features to the extent doing so is practical. The Panel also encourages increased data sharing between manufacturers and suppliers.”
Technology: The Panel suggests advanced sensors and telemetry could make their way into airbags and coupled with a wider data collection strategy provide more in-service data.
UPDATE 3 May 2016: The Takata recall may be extended to add 35-40 million vehicles.
UPDATE 29 August 2016: The New York Times discuss A Cheaper Airbag, and Takata’s Road to a Deadly Crisis, suggesting that Takata won business in the 1990s by under cutting the the competition with an allegedly inferior propellant. In an unrelated development, a Takata delivery vehicle suffered a fatal explosion in Texas.
UPDATE 31 August 2016: US senators seek federal probe of Takata-linked explosion by the National Transportation Safety Board (NTSB).
UPDATE 28 December 2016: Takata could settle U.S. criminal probe next month: source
The Wall Street Journal, citing people familiar with the matter, reported earlier on Wednesday that a settlement could require Takata to pay as much as $1 billion and be reached as early as January.
UPDATE 20 January 2017: Takata shares dive 17% on bankruptcy restructuring report
Sweden’s Autoliv, the world’s leading airbag manufacturer, and a consortium led by U.S. auto parts firm Key Safety Systems, are both expected to present competing turnaround proposals as early as this week… Last week, Takata agreed to plead guilty to fraud and pay $1 billion to settle the faulty airbag scandal with U.S. regulators, but that was not likely to be the end of its liabilities over the affair. The United States also has indicted three former Takata executives, bringing the first criminal charges in the case.
UPDATE 30 January 2017: Looking at the The Takata Scandal and the Value of Diversity for boards and management teams: “The problem is not with any specific culture — all of which have their advantages and disadvantages — but with a lack of diversity. After all, it’s easier to fall prey to groupthink when you’re part of a uniform group”.
UPDATE 16 June 2017: “Air bag maker Takata to file for bankruptcy this month” say Reuters sources.
Takata Corp, the Japanese company facing billions in liabilities stemming from its defective air bag inflators, is preparing to file for bankruptcy as early as next week as it works toward a deal for financial backing from U.S. auto parts maker Key Safety Systems Inc, sources said on Thursday. Takata, one of the world’s biggest automotive suppliers, has been working for months to complete a deal with Key Safety. A person briefed on the matter told Reuters Key was expected to acquire Takata assets as part of a restructuring in bankruptcy.
UPDATE 11 February 2018: Takata, injured drivers reach deal to end U.S. bankruptcy
UPDATE 1 February 2019: Auto makers are still responding to this problem slowly and without full disclosure. In December 2018, Mazda issued another recall, but blandly described the problem as “a number of airbags…may not deploy correctly”, with no hint that the incorrect aspect is shrapnel deployed towards the occupant the airbag was meant to protect. The recall is of course free of charge to the vehicle owners. However, if you were to live in Aberdeenshire, for example, and tried to arrange an appointment today, the local dealer, Arnold Clark, the only organisation between Dundee and Inverness authorised by Mazda to do the task, would offer you a date in mid-June 2019 at the earliest, such is the urgency to protect around 100,000 Mazda customers in the UK alone that had recalls in 2018.
UPDATE 4 October 2020: Honda confirms 17th U.S. death in Takata air bag rupture
This January 2015 article is also worth a look: Handling of Takata Recall Points to Issues at the Top