Honda has announced an $605 million-dollar economic settlement which will cover more than 16 million vehicles here in the U.S. which had defective Takata airbags installed.
At least 18 people have been killed and another 180 victims injured because of issues with faulty Takata airbag inflators. The inflators have propellant wafers made out of ammonium nitrate. The ammonium nitrate Takata used as no chemical drying agent to protect it from the elements. Higher temperature, moisture, and aging can cause the ammonium nitrate to explode, which is what is happening with the airbags. When the explosions occur, shards of metal spew throughout the vehicle, severely injuring victims.
So far, there have been more than 42 million vehicles recalled, but millions more still need to be recalled. The recalls have involved 19 different automakers. Honda currently has 11.4 million vehicles under recall and company officials say there could be an additional 5.1 million vehicles whose owners receive recall notices.
The economic settlement reached will cover the out-of-pocket cost to owners to have their vehicles repaired. Expenses such as lost wages, childcare costs, and rental car payments are some of the items that vehicle owners could be reimbursed for.
The settlement also covers claims that the vehicles were misrepresented as being safe, when in fact, buyers were overpaying due to the defective airbags.
Several other auto manufacturers have also reached economic settlements, including Nissan Motor Co., who agreed to pay $97.7 million for their 4.4 recalled vehicles. Preliminary approvals have been given to BMW AG, Mazda, Subaru, and Toyota, which total $553 million for the 15.8 vehicles which were recalled due to the defective airbags.
At the beginning of the year, Takata pled guilty to criminal wrongdoing and agreed to $1 billion settlement with the Justice Department. They also agreed to set up two different restitution funds, one to compensate automakers for all the recalls and another fund for victims who have been injured and have not reached a settlement yet.
Upon hearing of the latest Takata airbag recall news, Attorney Ward commented, “I think it’s important that these types of economic settlements are set up. Owners are often forced to take time off from work or rent vehicles because of the time it takes to fix their own vehicles. Why should they bear that burden when it is through no fault of their own these repairs are needed?”