Exclusive: Takata investigated defective air bag inflator as early as 2003

As early as 2003, Takata Corp (7312.T) ran an investigation into an air bag inflator that ruptured in a BMW (BMWG.DE) vehicle, but concluded the problem was an anomaly, the company said on Tuesday, ahead of a second U.S. congressional hearing on dangerous air bags it supplied.

In addition, technicians employed by the Japanese auto partssupplier in Michigan tested inflators for potential defects in 2004, over a year before Takata has said it first learned of defects that are now linked to five deaths, two people directly involved in Takata's investigation told Reuters.

The disclosure that Takata was looking into problems with its air bag inflators earlier than previously disclosed could open the company to more intense scrutiny from U.S. lawmakers, regulators and prosecutors in an ongoing criminal investigation into a series of recalls that now targets more than 16 million vehicles worldwide.

Hiroshi Shimizu, Takata's chief quality officer, told a Senate committee hearing last month that the company did not begin to look into inflator defects until May 2005 when it learned of a 2004 accident involving a Honda Accord. Shimizu is scheduled to testify later on Wednesday at the second hearing.

Two former Takata employees provided Reuters with details of internal investigations of ruptured inflators: one in January 2004 at a Takata laboratory in Armada, Michigan, and one in June 2004 at a test facility in Auburn Hills, Michigan. The second technical investigation was first reported by The New York Times.

The January 2004 investigation, into issues with driver-side air bag inflators made at a now-shuttered plant in LaGrange, Georgia, was prompted by a 2003 incident of a ruptured inflator in a BMW, one of the former employees said.

Responding to a query from Reuters, Takata confirmed the 2003 BMW incident, which it said took place in Switzerland and was "unrelated" to the 2004 Honda incident.

"Takata and BMW thoroughly investigated that event together in 2003 and concluded that the cause was an overloaded inflator," Takata said in an email to Reuters. "We believe that all testing concerning the 2003 event occurred in 2003 at Takata's LaGrange, Georgia, facility - not in Michigan."

Takata did not explain what it meant by an "overloaded inflator." The company has identified problems in handling the explosive propellant packed into inflators as the reason that some inflators exploded in accidents with dangerous force.

Takata provided air bags in at least 10.5 million cars that have been recalled in the United States because the inflators can rupture and spray metal fragments into vehicles. The defective inflators have been linked to at least five deaths, all in Honda cars, including one in Malaysia.

TECHNICAL JARGON

The internal investigations into ruptured inflators described by the two former Takata employees used technical language favored by Takata: an inflator that exploded with excessive force was said to have gone "high order," while an inflator that ruptured and sprayed metal shards was said to have "rapidly disassembled."

The January 2004 testing at the Armada lab was conducted at the request of a senior Takata executive, the former employee said, and involved a type of inflator known internally as PSDI-4. That type of inflator was supplied to Honda Motor (7267.T) and Toyota Motor (7203.T) as well as BMW, according to a Takata presentation reviewed by Reuters.

According to the former employee, the testing in Armada involved a sample batch of PSDI-4 inflators, some of which were heated to high temperatures, others cooled to extremely low temperatures and still others left at room temperature. The testing indicated some improper welding and chemical propellant wafers that were incorrectly installed, the former employee said.

Test data and photos were compiled in a report that was turned over in February 2004 to the senior official who ordered the testing. It's not clear what the report said. "I don't know what he did with that report," the former employee said. "I was told the test results were inconclusive."

A second former Takata employee provided details of testing that took place in June 2004 on a ruptured inflator that was delivered to the company's test facility in Auburn Hills. The inflator, the former employee said, was recovered from the Accord involved in the accident in Alabama in May 2004.

"We were told that Honda looked at the part first, then turned it over to Takata," the former employee said. "That inflator had ruptured. It had a chunk missing."

Asked about the outcome of the testing, which was finished in July 2004, the former employee said, "I don't know if Honda saw the results. Our job was to test parts and provide data to our engineers, who would provide that data to the customer."

Honda told NHTSA in a September 2009 letter that the Alabama accident "was reported to Honda in 2004, and the information was shared with TK Holdings Inc. at that time."

At the Nov. 21 Senate hearing, senior vice president Rick Schostek said Honda believed it provided information to Takata about the Alabama accident in 2005, but added, "we are still checking our records."

NHTSA, which has threatened to sanction Takata for its handling of the recalls, did not immediately comment.

Regulators in Tokyo were not aware of the earlier tests or whether the results had been shared with automakers. "We need to know why they were running these tests," a senior official told Reuters. Japanese regulators did not find out about Takata's exploding air bags until November, 2008.