Takata taps former U.S. transport chiefs in air bag safety crisis
Reuters
(Adds background on former officials working for Takata)
By Ben Klayman, Paul Lienert and Patrick Rucker
DETROIT/WASHINGTON, Dec 2 (Reuters) - Takata Corp has recruited three former U.S. transportation secretaries to help the Japanese parts supplier navigate a growing auto safety crisis associated with millions of its airbags, the company announced on Tuesday.
Samuel K. Skinner, a former White House Chief of Staff and U.S. Transportation Secretary, will lead an independent quality panel while two other former U.S. transportation secretaries, Rodney Slater and Norman Mineta, will advise Takata as it struggles to handle a series of recalls.
The move to bring in Washington heavy hitters shows a new aggressiveness by Takata in trying to contain the scandal involving potentially defective air bags that can rupture upon deployment, spraying metal shards at the vehicle's occupants.
At least five deaths have been linked to the scandal. Takata is also facing a criminal probe, more than 20 class action lawsuits, congressional scrutiny, and an investigation by the National Highway Traffic Safety Administration.
The move also put a fresh spotlight on the revolving door that has frequently spun between the auto industry and its regulators.
A Takata U.S. spokesman did not respond to a question concerning how the former transportation secretaries would be paid.
In announcing the former officials' retention, Chief Executive Officer Shigehisa Takada said the company wanted to show the public and its regulators that it will not rest until it has resolved the air bag performance issues.
He said the panel helmed by Skinner will produce an independent report on its manufacuturing processes that will be made public. He also said his company would take "dramatic actions" to increase output of the replacement air bag inflators kits. That includes working with rivals and examining whether their products can be used safely, he said.
"I know we can and must do more," he said in a Tuesday statement.
REVOLVING DOOR
Since leaving office, the former transportation secretaries now working with Takata have booked decades of experience advising corporate clients - often companies facing a reputational crisis.
When Toyota was embroiled in a safety scandal about a faulty accelerator several years ago, Slater, who served President Bill Clinton, led a company-funded panel to examine how the company handled the crisis.
The 2011 Slater report faulted the Japanese automaker for a culture skeptical of safety concerns, though it offered no opinion on possible mechanical faults. Toyota ultimately paid $1.2 billion to settle a criminal probe into whether it misled consumers about the deadly flaw.
Mineta, who succeeded Slater as President George W. Bush's first Transportation Secretary, was an executive with public relations firm Hill+Knowlton Strategies for more than six years after leaving office in 2006.
Skinner has served on many corporate boards since leaving public life.
Skinner and Slater, through representatives, declined comment. Mineta was not immediately available for comment.
The auto industry and its regulators have been frequently criticized for an overly cozy relationship, but little has been done to formally crack down on the revolving door. Democratic Senator Barbara Boxer in 2010 introduced an unsuccessful bill that would have restricted such movements between NHTSA and automakers
Clarence Ditlow, executive director of the Center for Auto Safety, said automakers have every right to try and boost their image with prominent consultants, but outsiders can see the tactic for what it is.
"The bigger the crisis, the bigger the personalities," he said. "Toyota needed one former Transporation Secretary. Takata tripled-down on that."
CONGRESSIONAL HOT SEAT
Takata's announcement comes ahead of a U.S. House of Representatives hearing on Wednesday that will feature executives from Takata and automakers, as well as NHTSA Deputy Administrator David Friedman.
The hearing will likely focus on whether Takata will heed NHTSA's call for it to expand its largely regional recall of driver-side air bags to all 50 states.
Hiroshi Shimizu, Takata's senior vice president for global quality assurance, said in prepared remarks that a phased-in recall should give priority to U.S. regions with higher humidity - believed to be a factor in some air bag ruptures.
NHTSA had given Takata until Tuesday to declare that its air bag inflators were defective and issue a national recall. The Nikkei reported on Tuesday that Takata was preparing to comply, but the prepared testimony did not address the issue, and the company did not respond to a request for comment.
Honda North American Executive Vice President Rick Schostek said in his testimony that a national recall would lead to parts shortages, but the Japanese automaker was "seriously considering" it for the driver-side air bag inflators.
Toyota North American vice president Abbas Saadat said in his testimony that the automaker wanted "additional assurances about the integrity and quality of Takata's manufacturing processes." Toyota and Honda called on Tuesday for independent industrywide tests of Takata air bag inflators subject to recalls.
(Additional reporting by Bernie Woodall in Detroit and Patrick Rucker in Washington; Editing by Karey Van Hall, Chizu Nomiyama, Christian Plumb and Lisa Von Ahn)
