Regulators have piled pressure on General Motors Company (NYSE:GM) to recall 7 million pickups and SUVs to replace potentially dangerous airbag inflators. The National Highway Traffic Safety Administration has ordered the automaker to replace the Takata airbags linked to at least 17 deaths in the U.S.
Takata Faulty Airbags
The airbags in question, developed by now bankrupt, Japanese manufacturer Takata, explode and spray shrapnel through the vehicle whenever one is involved in an accident. Takata allegedly used volatile ammonium nitrate to create a small explosion to fill the airbags in case of a crash.
Later on, it was found that the chemical deteriorated whenever exposed to heat and humidity, conversely exploding with too much pressure. In addition to causing deaths, the airbags allegedly have caused some drivers and passengers to go blind.
General Motors has confirmed it will not fight the decision even as it maintains that the vehicles fitted with the Takata airbags are safe. The automaker had initially recalled 800,000 vehicles, which it says did not pose any danger given that they were equipped with a different inflator.
The dispute between GM and the regulator has been ongoing for four years. The safety regulator has always insisted that GM must recall the 5.9 million cars registered in the U.S, insisting that the inflators in question are of the same type of explosion on being subjected to high heat and humidity.
The recall decision comes more than six years after the first recall came into play. The U.S portion of the recall since 2014 has already reached 63 million airbags. In addition to recalling 5.9 million domestic vehicles, GM is to recall another 1.1 million vehicles elsewhere in the world. The latest recall is poised to cost the company $1.2 billion.
The high $1.2 billion charge has to do with GM’s incurring all the costs as Takata has already filed for bankruptcy. Likewise, the company expects to spend $400 million next year and additional funds in relation to the recalls in subsequent years.