Automakers have tentative settlement in Takata air bags lawsuit
Associated Press
DETROIT — Toyota, Subaru, Mazda and BMW have reached a proposed settlement that would compensate owners of 15.8 million vehicles for money they lost due tothe massive recall of Takata airbags.
In documents filed Thursday with a federal court in Miami, the automakers agreed to pay $553 million to compensate owners and widen their efforts to make sure vehicles are being repaired.The court still must approvethe settlement.
Takata’s air bag inflators can explode with too much force, hurling shrapnel into drivers and passengers. The inflators are blamed for at least16 deaths and 180 injuries worldwide. The problem touched off the largest automotive recall in U.S. history, involving 42 million vehicles and 69 million air bag inflators.
The settlement would compensate owners for things like lost wages or child care while they were taking their vehicles in for the recall repair. Ownerscould also be compensated if they paid for a rental car or for vehicle storage while they were waiting for a car to be repaired. Owners mayalso get payments of up to $500each.
The settlement does not cover personal-injury claims relatedto the air bags.
The settlement would also require the automakers to step up their efforts to locate owners and educate them aboutthe need to complete the recall repairs. As of April 28, only 32 percent of Toyota owners, 31 percent of Subaru owners, 18 percent of Mazda owners and 16 percent of BMW owners had completed the repairs, according to the National Highway Traffic Safety Administration.
“Many consumers are unaware of the dangers their vehicles pose,” Peter Prieto, a partner at the law firm Podhurst Orseck who served as the lead counsel in the classaction case, said in a conference call with reporters. “It will take years to complete the recalls.”
Automakers would be required to provide free rental cars to owners of the highestrisk cars. U.S. safety regulators have determined that older cars are at the highest risk, since a chemical Takata used in its air bags can break down over time when it’s exposed to humidity. The 20022006 BMW 3 Series, 2003-2006 Mazda6, 2005-2008 Subaru Legacy and 2003-2007 Toyota Corolla are among the vehiclescovered by this settlement that are considered the highestrisk.
The settlement affects 9.2 million Toyota vehicles, 2.6 million Subaru vehicles, 2.3 million BMW vehicles and 1.7 million Mazda vehicles. The recall affects vehicles as far back as the 2000 model year and as recent as the 2016 modelyear.
Toyota would pay the most under the settlement — at $278.5 million — followed by BMW at $131 million, Mazda $75.8 million and Subaru $68.3 million.
Nissan, Honda and Ford are also part of the ongoing federal court case, but Mr. Prieto wouldn’t say Thursday whether he is talking to those companies about similar settlements.
Takata and its largest customer, Honda, first noted violent air-bag ruptures more thana decade ago, but failed to initiate recalls or notify safety regulators. Takata was later found to have manipulated and destroyed testing data related to its inflaters, and for a timeblamed limited manufacturing errors for the explosions.
Japanese auto supplier Takata Corp. pleaded guilty to fraud in federal court in February. The company has agreed to pay $1 billion in penalties for concealing defects withits air bags.
Takata air bags have been linked to at least 11 deaths and morethan 180 injuries.