Automotive Recyclers Association Statement on Recent Media Coverage of Defective Takata Airbags

The Automotive Recyclers Association (ARA) represents over 4,500 professional automotive recyclers across the United States and in 17 countries internationally. The professional automotive recycling industry shares a common goal of safely and efficiently processing inoperable motor vehicles in an environmentally responsible manner.

Over the past several weeks, local newscasts across the country have aired reports regarding the reuse of non-deployed original equipment manufacturer (OEM) airbags. Given the complex issues regarding automotive replacement parts and the automotive supply chain, it is sometimes difficult for local news reporters to accurately capture the full range of facts surrounding such an important safety issue. When reporters fail to reach out to industry stakeholders to better understand the complexities, the challenge of fair and accurate reporting is made even more difficult.

ARA would like to address the misrepresentations about the utilization of recycled, non-deployed OEM airbags contained in these newscasts as well as highlight aspects of the issue that have been ignored by the media.

Defective Takata Airbags
First and foremost, it must be reiterated in these news reports that Takata invented an airbag-inflator technology that reportedly gave it a cost advantage over its competitors in the airbag market, but the company’s own labs found that the airbag propellant could go off accidentally in hot, high-humidity conditions, turning the inflator into “shrapnel.”

It is also important for the media to note that the U.S. Department of Justice has opened a criminal investigation and stated that four auto manufacturers knew of the defect “for years.” Lawyers for the victims filed a civil suit in Florida in February 2017 stating that emails and internal documents from four manufacturers indicate “that cost considerations influenced automakers’ decision to adopt Takata’s airbags in the early 2000s despite safety concerns.”

Professional Automotive Recyclers and the Automotive Supply Chain
It is important for consumers to procure used vehicles and replacement parts from reputable businesses licensed in their state of operation. Professional automotive recycling businesses are aware of the dangers of defective Takata airbags and the federal requirement prohibiting the sale of non-remedied recalled automotive parts. Many ARA member facilities are participating in Honda’s airbag module buy-back program or taking other steps to prevent the reutilization of these defective airbags, such as looking up acquired vehicles using the National Highways Traffic Safety Administration’s (NHTSA) website, which allows vehicles under recall to be identified by vehicle identification number (VIN).

Airbags Save Lives
ARA has gone on record repeatedly warning consumers as well as governmental agencies about the prevalence of counterfeit airbags and of the importance of replacing airbags in any vehicle that has sustained an airbag deployment from a collision accident or other event before that vehicle is allowed to go back on the road. Recycled non-deployed OEM airbags play a proven role in the motor vehicle repair process as a viable replacement part option, and the availability of recycled parts ensures that quality used vehicles are available to any consumer.

Recycled Non-Deployed Airbags Perform to Pre-Accident Specifications
ARA strongly supports the reuse of non-deployed OEM airbags which have met industry standards and believes that those evaluated, recycled airbag components are a safe, economically-smart repair option to restore vehicles to their pre-accident condition. Research and years of experience have proven replacement airbags to be a safe option.

Lacking any statistical support to their allegations, some industry groups continue to push unfounded claims regarding the use of recycled airbag modules. These groups continue to rely on personal opinions, influenced by profit motives, rather than on sound technical analysis. However, a look at comprehensive safety tests on non-deployed OEM airbags conducted by Garwood Laboratories, Inc. (in accordance with SAE Inflator Restraints Standard SAE J1630 and Manufacturers Deployment Standards) reveals that recycled airbag use is indeed a solid option that protects the consumer.

Furthermore, recycled airbag modules have been used in insurance collision repairs in parts of Canada for many years. Both the Insurance Corporation of British Columbia (ICBC) and Saskatchewan General Insurance (SGI) have been successfully using recycled airbags in repairs for many years. Before doing so, ICBC conducted testing that compared recycled and new airbags. The mix consisted of recycled airbags from domestic and Japanese manufacturers. New Ford, General Motors, Chrysler and Honda airbags of the same application as recycled ones were purchased from local dealerships for comparison to the recycled ones. The results of the test were that, effective April 2001, ICBC and body shops began utilizing recycled previously undeployed airbags supplied by ICBC/ARA “Certified” Automotive Recyclers.

Airbag Check Vehicle History Reports
In a number of newscasts, Carfax has recommended that consumers considering the purchase of used motor vehicles use the free airbag check on the Carfax website. With this tool, users can identify if the vehicle they are considering had an airbag deployment in a prior accident. In a recent News Channel 3-Memphis report, Christopher Basso, Carfax spokesperson stated that if airbags have been replaced due to a prior accident, consumers should check with a mechanic, and he or she can then trace the airbag’s history with just one number. “They can remove the airbag cover, look at the serial number and figure out where that air bag came from, if it’s a recycled unit and if it’s been recalled.” Basso added that if someone is buying a used car, this provides a method for determining the airbag’s origin and any potential problems. However, no such database is available to the automotive recycling industry.

ARA Continues to Push Congressional and Regulatory Action
Michael Brooks, acting Director of the nonprofit Center for Auto Safety has stated, “There should be a database of some sort that tracks each airbag by the serial number or any recalled part.”

The Transportation Recall Enhancement, Accountability and Documentation (TREAD) Act of 2000 prohibits the resale of used automotive parts subject to a recall that have not been remedied. To provide the necessary automotive manufacturer parts information necessary to comply with the TREAD Act, Congress passed language in the Fixing America’s Surface Transportation (FAST) Act in December 2015. Section 24116 of the FAST Act seeks to provide professional automotive recyclers the vital automotive manufacturer data to efficiently and accurately identify which defective parts by a manufacturer are subject to an automotive recall. Regrettably, the original TREAD Act did not compel the automakers to provide essential parts data, hampering efforts to maximize resale safety. Without a federal requirement compelling such disclosure, OEMs have been unwilling to share the parts data with recyclers because they have a financial interest in encouraging the use of only new OEM parts. The language from the 2015 FAST Act is currently in the rulemaking process at the National Highway Traffic Safety Administration (NHTSA) but to date this provision has not been implemented. ARA has followed up repeatedly with NHTSA as to the status of the rulemaking.

In an effort to secure additional safety information such as airbag serial numbers from OEMs who refuse to provide them to recyclers, Rep. Kinzinger introduced on May 16, 2017 a bill, H.R. 2460, that will provide professional automotive recyclers with access to all OEM parts data for all vehicles. This legislation would require, “Each original equipment manufacturer (OEM) part name included with such vehicle, a description of each such part, each part number (including any superseded and successor OEM part number), any other part identification number (such as a serial number) and distinguishing marking of each such part, and the software of each such part (if applicable)….Build sheet information [and]…Additional information as determined by the Secretary.”

Automakers are fully aware that the life-cycle of their parts can go beyond the initial utilization in a motor vehicle from the factory. This recognition was underscored in August 2014, when General Motors (GM) contracted with a third-party supplier to “coordinate the purchase and return of certain used parts, which are subject to a product safety ignition switch recall, from salvage yards [automotive recycling facilities].”

In a notice from this third-party supplier, on behalf of GM, to automotive recycling facilities, the correspondence not only included the make, model and year of the vehicles subject to the recall but also detailed the specific part numbers, which the notice stated, “are provided so the manager can identify the parts being recalled.” It also included the Hollander Interchange numbers for the ignition switches. Clearly GM understands that specific part numbers are vital to correctly and efficiently locate the affected parts. Also clear is that only when it is in their best interest will this information be voluntarily shared, underscoring the need for federal requirements to share such information.

Financial Incentives Can Steer Body Shops to Utilize New Parts over Quality, Recycled OEM Parts
ARA recognizes the benefits that each repair part option (recycled, new, aftermarket, remanufactured) may provide in a given repair. Currently, however, repair shops are paid more for using more expensive parts, often meaning repair facilities use new parts over used parts, even where the used part would provide the same level of safety for less money. To help address unfair market disincentives for the sale of some types of parts versus others, ARA has encouraged the adoption of an unbiased compensation structure to remedy the current system that provides the largest financial rewards to collision repair shops only when they utilize the most expensive replacement part option in repairs.

There are millions of consumers who cannot afford the $2,000-$4,000 price tag for the installment of new airbag modules. Quality, recycled non-deployed OEM airbags are a safe, viable replacement parts option. Regrettably, a 30 percent commission on a $2,000-$4,000 airbag leads many repairers to narrow the consumer’s choice for a replacement airbag to only new OEM replacement parts.

More and more frequently it appears that compensation levels on parts, rather than the quality or safety of the underlying product, are dictating the parts choice outcome. ARA strongly believes that it should be the consumers and the expertise of collision repair professionals which determine which part is best suited for a particular repair need, and not the potential compensation.

Automotive Recyclers Association
ARA aims to further the automotive recycling industry through various services and programs to increase public awareness of the industry’s role in conserving the future through automotive recycling and to foster awareness of the industry’s value as a high quality, low cost, environmentally friendly replacement parts option for consumers. Representatives of ARA are available to inform interest parties on important automotive safety and part replacement options/issues.