On Nov. 3, Honda Motor Company released a statement noting its discontinuation in using Takata airbags. The decision comes after the airbag manufacturer was found guilty of test data misinterpretation and manipulation.
On the same day, the National Highway Traffic Safety Administration (NHTSA) announced that Takata will receive a $70 million fine for hiding defects in its airbags from the regulators. The manufacturer's penalties could rise to $130 million if it does not comply to the regulations stated by the administration.
"In several instances, Takata produced testing reports that contained selective, incomplete, or inaccurate data," stated the transportation secretary, Anthony Foxx.
No less than eight people died and more than 100 suffered injuries in accidents that were linked to malfunctioning airbags. According to tests, the inflaters of the security devices have a chance to break at impact, sending flying shrapnel inside the cabin. This caused over 19 million vehicles to be recalled only in the United States.
There are allegations that Takata knew about the flaws in the airbag design. The company, however, refused to provide the NHTSA with the full information.
"We are deeply troubled by this apparent behavior by one of our suppliers" a spokesperson from Honda noted.
The gas that causes the inflation of the airbags provides additional concerns. The older variants of airbags use ammonium nitrate as the propellant, and experts in car safety looked at them with caution. Takata claims that the main cause for the ruptures lies in the environmental conditions and not in the inflation gas or construction issues.
The NHTSA consent order reads that Takata is obliged to pull the plug on the use of ammonium nitrate, unless it can demonstrate its safety.
Even if Honda separates itself from Takata, the two companies have a long history of doing business together. As the Japanese car manufacturer scrutinized testing documents from the airbag company, it notified the authorities about the discrepancies it found.
A spokesperson from Honda made clear that the automaker not only presented the documents to the authorities, but also solicited a third-party audit to better understand Takata's test data. Honda affirmed that new Honda and Acura cars will sport airbag inflators for passenger and driver seats from companies other than Takata. However, Honda will still purchase safety equipment such as seatbelts from Takata.
The United States is the most important market for Takata, where the company banks around 37 percent of its net sales. The stock value for the car safety company plummeted 45 percent since last year, when the first questions about its reliability surfaced. Losing a big client such as Honda is bound to take a heavy toll.