Quality Failure Brings Takata Corporation’s 84 Year History to Bankruptcy

by David Park | July 19, 2017

Described by the U.S. National Highway Traffic Safety Administration (NHTSA) as “the most significant safety issue in the history of the United States,” the massive global recall of Takata’s air bag inflators has driven this established Japanese company to declare bankruptcy. This is a cautionary tale with particular relevance today for an industry on the verge of producing autonomous or “self-driving” vehicles that are extremely dependent on electronics quality.
As this June 25th Bloomberg article, “Roiled by Airbag Recall Crisis, Takata Files for Bankruptcy” suggests, the commercial exposure goes well beyond Takata. Over the last eight years, the recall requirement in the U.S. alone affects 43 million vehicles from brands including GM, Honda and Volkswagen, with only 38 percent of these vehicles retrofitted, leaving 27 million vehicles yet to be corrected and still vulnerable to failure.

This is a prime example of the need for greater in-depth quality management throughout the global supply chain. The complexity of manufacturing vehicles via a massive global supply chain has been daunting, and the rapid growth of electronics to replace hydro-mechanical components to perform fundamental tasks such as steering and braking has made quality testing a mission-critical assignment. To meet the quality expectations that the marketplace will demand, the automotive industry needs to broadly adopt big data product analytics to automatically monitor and correct product quality issues across all aspects of its global supply chain, especially when it comes to electronics.

The time to focus on electronic product quality is now, as the stakes will only get higher.