Honda Finds Convenient Scapegoat in Takata

As the Takata airbag inflator recalls top 40 million vehicles with global estimates of the eventual final tally upwards of 60 million, the OEMs have been happy to cast Takata as a rogue supplier, willing to deceive its customers – particularly Honda – by falsifying test data, and its design and parts validation processes. And lucky them – documents and testimony corroborate this meme.

If Takata were able to build inflator assemblies with a flawed propellant while battling well-known manufacturing process variability for more than a decade without its customers knowing, this would be a fraud of monumental proportions, indeed. But, in Honda’s case, it is highly unlikely. In fact, entire old-growth forests have been decimated in service to books and articles detailing Honda’s unique and super-close relationships with its suppliers. And you don’t have to look very far into the public record to conclude that the myriad management studies are based on myths or they show that Honda knew – or should have known – that Takata’s chronic inflator manufacturing problems were going to blow up in their faces.    

Take the 2015 Japan News article about Driving Honda, a book offering an inside examination of Honda’s history, business philosophy and practices by Jeffrey Rothfeder, who noted that Honda’s handling of the Takata airbag inflator defect went against decades of company quality control practices:

"The automaker has traditionally turned its suppliers into ‘carbon copies of Honda, with the same ideals, methods and objectives,’ Rothfeder says. So much so that it sends its employees to the supplier when there is a problem so that Honda can help rectify it as soon as possible."

Honda’s well-established corporate philosophy and practice, dating back to the company’s inception and celebrated in laudatory books and case management studies, belie its claims of being duped. Had Honda followed its own policies and practices, it would have detected Takata’s systemic problems long ago and taken an active role in quality control and prevention. Thus far, there is precious little evidence to suggest that Honda acted swiftly to ensure high quality after the first field explosion in a Unibody inflator in 2002 or even after the second one in 2004, which resulted in a serious injury. Although Honda began to wake up in 2007, after three additional field ruptures, it appears the company generally accepted Takata’s ever-evolving root causes.

If Honda was following its own playbook, Takata would have been subjected to Honda’s vigorous investigation, testing, root cause analysis, and process evaluations, until enough data had been generated and analyzed to ensure the problem had been correctly detected and eliminated. Because the failure effect was potentially life threatening, Honda should have required Takata to undergo new rigorous testing and thorough analyses after each recall and installed its Supplier Quality Assurance engineers at the Takata sites. Honda’s stringent quality control management system should have required the automaker to cease using Takata as a supplier when it could not stop the repeated explosions.

None of that apparently happened. Instead, Honda issued “rolling recalls” for 14 years (adding additional years and models), and allowed Takata to identify a different root cause each time. And when the shrapnel hit the fan, Honda was asked to explain to NHTSA and Congress why the airbag inflators in its vehicles were exploding, Honda shrugged and pointed to Takata.  

Best Damned Supplier System in Automotive Manufacturing

With 80 percent of any Honda vehicle produced by suppliers, Honda long ago realized that suppliers’ quality practices were tied to its own success. The automaker is involved with suppliers at a granular level on every aspect of the transaction: costs, design, problem-solving, manufacturing, and quality management. Its intimate marriage with suppliers has long been held up as a shining example to other manufacturers. One engineer who has worked with supplier companies interviewed by SRS put it this way: “when you work with Honda they know what’s in your shorts before you know what’s in your shorts.” 

In a 2013 Industry Week article, Dave Nelson, former senior vice president of purchasing and corporate affairs at American Honda Motor Co. and co-author of Powered by Honda: Developing Excellence in the Global Enterprise, noted that Honda’s corporate culture empowers all employees and “the inclusive relationships with their strategic suppliers, in which these suppliers are literally considered extensions of Honda.” At the core of this relationship are two competing values: “BP” which stands for Best Practice, Best Process, and Best Performance, and competitive pricing.

Honda also developed the concept of sangen shugi, which means that decisions are based on “going to the three realities: 

“Gen-ba. The real spot: go to the factory floor, the showroom, the backyard, the parking lot, the driver's seat, the back row, the truck cab and bed – wherever you must – to get firsthand knowledge.

Gen-butsu. The real part: use the firsthand knowledge to focus on the actual situation and begin to formulate a decision or recommendation.

Gen-jitsu. The real facts: support your decisions with actual data and information that you have collected at the real spot.”

 

According to Driving Honda, Honda considers gen-ba to be the most critical:

“It is relied upon daily at Honda to assess everything from a small glitch on the assembly line to the features in a new vehicle or upgraded model to the company’s globalization strategy. No decision is made at Honda without firsthand information, and no Honda manager or employee would dare try to offer a point of view, make a recommendation, or challenge an existing process or system unless he or she had “gone to the gen-ba,” a term that is heard at Honda factories and offices everywhere in the world, no matter what language is spoken locally.”

Like every aspect of Honda’s corporate identity, BP is discussed by employees with a fervor that is almost religious. For example, in a 1997 article about Honda’s application of lean manufacturing techniques, Honda Engineer Rick Mayo characterized BP as “a mission not a job”:

“We’ve learned that we’ve got to get BP in their company so it’s not seen as a radical change. We used to meet with the top guy and say ‘do this project.’ Now we realize that the supplier needs to have their own way of doing BP. So we ask ‘what will fit best with your overall plans?’ They don’t even need to call it BP. The improvement activities need to be part of their culture, their vision. BP is one club in the golf bag – it’s probably the driver, and we hit it hard-but it’s not meant to be everything to everyone.”

In practice, Honda’s corporate ideology translates into layers of quality control divisions and processes.  Honda’s production departments establish manufacturing control items and standards for each part, process, and work task based on designers’ intentions. The automaker uses a monthly report card to monitor its core suppliers, according to a 2004 Harvard Business Review article, with sections grading the supplier on quality, delivery, quantity, performance and incidents.

Honda is also certified under ISO 9001.2008, which defines the quality management system requirements for automotive suppliers -- in theory delivering continuous improvement and preventing defects -- and ISO/TS 16949, a companion standard. In 2005, Honda established the Global Honda Quality Standard, Honda’s book of knowledge based on its experiences producing quality products and preventing previous issues from recurring.

A Legend in Its Own Mind

So where were these Best Practices, international quality standards, and realities when Honda decided to install Takata-made airbag inflators featuring Phase-Stabilized Ammonium Nitrate (PSAN)? Engineers – including those at Takata – had recognized PSAN was an unacceptable gas generant for airbags at least two decades ago. According to a 1996 Takata patent application “the burning characteristics would be altered in such that the inflator would not operate property or might even blow up because of the excess pressure generated.” Takata engineers also noted that PSAN is volatile when exposed to moisture:

“It is also required that airbag inflators be subjected to environmental conditioning, such as high temperature heat aging, thermal aging, thermal cycling, thermal shock, humidity cycling, and so forth. These extreme tests can cause many problems, ranging from failure to inflate the airbag to over-pressurization of the inflator leading to rupture.”

All automotive manufacturers and suppliers use Design Failure Modes and Effects Analysis (DFMEA), to identify the potential failures of a particular component, with the aim of including fail safes that mitigate them. DFMEAs rank the severity of each failure mode -- with10 being the most severe -- the rate of occurrence, and the ease with which the plant can detect the failure. Any design with severity levels of 10 must be redesigned or addressed through a fail safe to prevent keep the failure mode from causing serious harm.

Given the long-recognized danger that PSAN destabilized by moisture can lead to rupture, any decent DFMEA would have included rupture caused by moisture exposure, humidity, and low density propellant. And given that rupture of a metal canister can obviously lead to injury and death, the severity ranking should have been a 10 for each of those. Honda has claimed Takata lied about the propensity for rupture, but the DFMEA should have predicted the dangers – and if it didn’t, it was on Honda to ask Takata to explain why.

More telling, suppliers bundle these DFMEAs and many other analyses into packets called Production Parts Approval Process (PPAPs), which OEMs use to choose their suppliers. The system was designed to ensure that the OEMs are ultimately responsible for the end product. OEMs require different levels of proof that a product is safe, depending on how much they trust the supplier. For example, Level 1 suppliers might only have to submit basic data on the product, while Level 5 suppliers will have to submit all supporting data and submit to an engineering review in-house. According to a PPAP manual from the Automotive Industry Action Group, “if there are signs of instability, corrective action should be taken. If stability cannot be achieved, contact the customer and determine appropriate action.”

The first energetic disassembly in a Honda vehicle in the field was in November 2001 when the Unibody inflator in a MY 2000 Accord ruptured at a dealership after a crash, resulting in a recall in 2002. Based on interviews with engineering experts, industry custom and standard practices demanded that Honda designate Takata a Level 5 under the PPAP system, requiring that Takata perform a new PPAP with Honda present at the facility.

Perhaps that occurred. Then again, three years later, when another rupture in a different type of inflator caused injuries, Honda decided that, this, too, was an “anomaly.” Honda did not part with Takata until November 2015 – 14 years after mounting evidence demonstrated what the DFMEA should have predicted from the outset.

Breakdown of a Marriage

During the years of second, third, fourth, fifth, to infinity and beyond chances, Honda repeatedly violated its own rigorous standards. Rather than take the blame and admit that it failed in its promise to “go to the gen-ba” to correct even minor glitches on a line, to meet its vaunted “goal of zero defects,” to keep its customers from getting killed by its inattention, Honda has consistently blamed Takata. Its communications to NHTSA from 2009 show the pattern of supplier abuse that continues to this day.

In 2009, when NHTSA opened a Recall Query to find out why Honda’s first 2008, teeny-tiny, 3,000-vehicle airbag inflator recall suddenly mushroomed by more than 100 times to 440,000 vehicles seven months later, Honda pointed the finger at Takata. From the Closing Resume:

“Honda indicated that it had relied on its supplier of the air bag inflators, Takata, Inc. (Takata), in studying the possible sources of the inflator ruptures and identifying the recall populations.  Accordingly, RMD issued a request for information to Takata on November 20, 2009, and Takata provided a partial response on December 23, 2009.  Takata then provided its complete response on February 19, 2010.”

In 2011, when Honda expanded its airbag inflator recalls by another 272,779 vehicles, the automaker told NHTSA that it had discovered an inflator explosion for a vehicle “outside of the VIN range of previous recalls, and the inflator module installed in the vehicle was outside of the suspect range previously identified by the supplier. Additional recent analysis of the supplier's manufacturing records for the period in which this recently ruptured inflator was manufactured revealed a small degree of uncertainty regarding which driver's airbag inflator modules may have been produced utilizing propellant from the suspect processing equipment.” Again, Takata.

In in its 2013 recall of passenger bag inflators in 561,422 Civic, CR-V and Odyssey vehicles, Honda blamed the slow drip of information coming from Takata. From Honda’s Part 573 Notice of Defect and Noncompliance: “Separately, Honda was informed by the supplier of another potential concern related to airbag inflator production that could affect the performance of these airbag modules.”

In 2014, when NHTSA opened a Preliminary Evaluation into the airbag inflator ruptures, Honda’s I-know-nothing-I-see-nothing stance got more explicit:

“In addition to Honda's field action decision-making being informed by Takata’s above-described testing, analyses and expertise, each of Honda's prior recalls of its vehicles with Takata driver and front passenger airbag inflators was based on Takata’s identification of production process failures during its manufacture of inflators. To date, Takata has not identified any design defect either in the propellant or the inflator designs. As a result, many of the countermeasures for the identified manufacturing failures were manufacturing process and control improvements. The ongoing quality control processes, including Takata’s line acceptance testing of airbag inflator propellant and other components, is used to validate manufacturing process changes, which were applied to the production of replacement parts. Honda is aware that Takata conducts quality control testing on its inflators; however, the details of the methodology, timing, and results of those tests are generated and maintained by Takata. Honda and Takata have been working closely together for the last seven years to investigate these issues.”

At the December 2014 Congressional hearing on the exploding inflator crisis, Congressman Bill Johnson (R – Ohio) asked Honda at the hearing, “What analysis did Honda undergo, if any, and have you done any independent analysis to date to determine if a recall of the airbags are necessary -- or the inflators, rather?” Rick Schostek, HAM’s Executive Vice President, replied:

“I think we need to separate the recall decision versus testing.  So the recall decision that we make is based on information that we receive, for example, from Takata with regard to manufacturing defects, they told us what those manufacturing defects were.  We did not simply blindly accept their analysis, but our engineers looked at it and was it reasonable, and therefore, based on that, we have effected recalls over time.”  

There are none so blind as though who will not see, eh, Honda?

[Safety Research & Strategies has been reporting on Honda and Takata airbag ruptures since Apr. 17th, 2013., starting with The Continuing Case of Takatas Exploding Airbags]

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