Takata has admitted to hiding evidence that millions of its airbag inflators can explode with too much force. File picture: Joe Skipper / Reuters.

Detroit – Japanese vehicle parts maker Takata pleaded guilty to fraud on Monday and agreed to pay $1 billion (R12.9bn) in penalties for concealing a deadly airbag defect blamed for at least 16 deaths, most of them in the US.

The scandal, meanwhile, seemed to grow wider when plaintiffs' attorneys charged that five major car companies knew that the devices were dangerous but continued to use them for years to save money.

In pleading guilty, Takata admitted to hiding evidence that millions of its airbag inflators can explode with too much force, hurling lethal shrapnel into drivers and passengers.

The inflators are blamed for 11 deaths in the US alone and more than 180 injuries worldwide. The problem touched off the biggest recall in US automotive history, involving 42 million vehicles and up to 69 million inflators.

The penalties include $850 million (R11bn) in restitution to carmakers, $125 million (R1.6bn) for victims and families and a $25 million (R324m) criminal fine. Separately, three former executives are charged with falsifying test reports. They remain in Japan.

Car companies implicated

Meanwhile, plaintiffs in dozens of lawsuits over the defect charged in court papers filed on Monday in Miami that Honda, Toyota, Nissan, Ford and BMW had independent knowledge that Takata's airbags were unsafe before putting them in millions of vehicles.

After an inflator ruptured in 2009, one of the car companies described the problem as "one in which a passenger protection device was transformed into a killing weapon," the court filing said. The company was not identified in the document.

The filing marks the broadest allegation yet that carmakers knowingly put their customers in danger.

"The automotive defendants were aware that rupture after rupture, both during testing and in the field, confirmed how dangerous and defective Takata's airbags were," the plaintiffs' attorneys said.

The car companies have asserted that they were deceived by Takata and shouldn't be held liable.

In fact, in Takata's plea agreement, the Justice Department says Takata got the car companies to keep buying its inflators "through submission of false and fraudulent reports and other information that concealed the true and accurate test results."

The plaintiffs are suing not only over the deaths and injuries but over what they say is the vehicles' loss in value because of the defect.

Allegations made against carmakers

Honda, Takata's biggest customer, was intimately involved in designing Takata inflators, and two of them exploded and ruptured at Honda facilities in 1999 and 2000.

Toyota had quality concerns about Takata in 2003, the same year an inflator ruptured at a Toyota testing facility. At least 15 inflators in Toyotas had blown apart by 2014.

Ford picked Takata inflators over the objections of its own inflator expert because Takata was apparently the only company that could provide the number Ford needed, the lawyers wrote. One document said Ford had a "gun to its head, so it had to accept ammonium nitrate."

Nissan switched to Takata inflators "primarily, if not solely" to save about $4 per inflator. Another carmaker told Nissan about the risky inflators in 2006.

BMW went to Takata seeking cost savings. As early as 2003, a Takata inflator ruptured in a BMW in Switzerland.

BMW, Nissan and Toyota declined to comment. Honda said it was preparing a statement. Ford did not immediately respond to a message for comment.

Root of the problem

Takata's inflators use ammonium nitrate to create a small explosion that inflates airbags in a crash. But when exposed to prolonged high temperatures and humidity, the chemical can deteriorate and burn too fast. That can blow apart a metal canister.

In the US, 19 car companies are recalling the inflators. Worldwide, the total number of inflators being recalled is over 100 million.

Karl Brauer, executive publisher of Kelley Blue Book, said authorities may have kept the penalty manageable so Takata could stay in business and continue to carry out the giant recall.

"My sense is there has been more kid-gloves treatment of Tataka simply because destroying them makes the problem much worse," Brauer said.


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