Sunday, November 30, 2014

重ちゃん Shige-chan, grow up

"Brain image" of Shigehisa Takada (Takata CEO,) found on a Japanese site.
The light pink characters mean "secret." (!)
The others mean "change" or "weird," "friend," and "desire."
I don't know what the bright pink "H" stands for, maybe "Holiday."

This picture is a mystery, but meanwhile, Shige-chan,
重ちゃん, grow up.
Lives depend on you.

Link to ”lie-net” (uso-net) maker of this mysterious image.

This is Shige-chan.

Akiko Takada, CEO's mother, reported to be dominant person in Takata

Mama Takada yells at son, presumably for losing $900 million.

Hats off to Reuters for fabulous reporting on the Takata airbag defects, especially Norihiko Shirouzu, the reporter who wrote today's installment of this unfolding tragic saga.
Today's article gets into the company's nitty-gritty inside story. There are some chilling parallels to what seemed to have happened inside Toyota during its own crisis.

Takata has yielded quite a few whistleblowers. More than Toyota. Maybe Takata's whistleblowers think the company's future is in doubt, or they want to talk for some good reason, like to save lives. 

"BIG WIFE"[Shigehisa Takada's] mother Akiko, a former Takata executive, now heads the non-profit Takata Foundation, but remains vocal as a special adviser to the company. Some managers call her "O-okusan", or "big wife", underscoring her influence, while Shigehisa is referred to as "the son", or "Shige-chan" - a familiar, short form of his name with a suffix normally reserved for children."In a business situation, she could be very forceful and tries to impose her way in just about every way possible," said one of Shigehisa's business associates who has worked with Akiko on a project. Two of the three associates recalled how she once engaged in a tit-for-tat negative campaign with a rival."Imagine being her son and trying to exercise leadership with her buzzing around you," the person said. "He's paralyzed to make decisions on his own."

Takada is also under pressure from big automaker clients such as Honda Motor and Toyota Motor which try to control and influence how Takata deals with the recalls, two of the business associates said. Also, external legal advisers hired in the United States have focused on minimizing potential court damage rather than on repairing a battered public image.The business associates said the lawyers restrict what Takada and other executives say and do publicly.
Takata, which has around 43,000 employees globally, has seen its market value slump almost 60 percent this year to just above $900 million.In one recent incident, Shigehisa went "missing for a few hours" from Takata's Tokyo headquarters after a row with his mother, said one person familiar with the matter."He was yelled at by his mother and went missing. Nobody knows where he went. He came back after a few hours," the person said."

Questions: Why is Mama Takada's money more important than the lives of the company's end customers? 
And how is Toyota influencing Takata--to maximize recalls, or to minimize them?

Friday, November 28, 2014

NHTSA threatens to impose fines on Takata - Worried Man Blues

Yoichiro Nomura, Takata CFO, apologizes.
Is he worried? Maybe he should be more worried than he is.


Worried Man Blues: It Takes a Worried Man to Sing a Worried Song

It takes a worried man to sing a worried song It takes a worried man to sing a worried song It takes a worried man to sing a worried song I'm worried now, but I won't be worried long I went across the river and I lay down to sleep I went across the river and I lay down to sleep I went across the river and I lay down to sleep I woke up and I had shackles on my feet Twenty-nine links of chain around my leg* Twenty-nine links of chain around my leg Twenty-nine links of chain around my leg And on each link, an initial of my name It takes a worried man to sing a worried song It takes a worried man to sing a worried song It takes a worried man to sing a worried song I'm worried now, but I won't be worried long I asked the judge, "What's gonna be my fine" I asked the judge, "What's gonna be my fine" I said, "Oh, judge, what's gonna be my fine" He said, "Twenty-one years on the Rocky Mountain Line"** Twenty-one years to pay for my awful crime Twenty-one years to pay for my awful crime Twenty-one years to pay for my awful crime Twenty one years, but I still got ninety-nine It takes a worried man to sing a worried song It takes a worried man to sing a worried song It takes a worried man to sing a worried song I'm worried now, but I won't be worried long The train pulled out, sixteen coaches long*** The train pulled out, sixteen coaches long The train pulled out, sixteen coaches long The one I love, she's on that train and gone I looked down the track, as far as I could see I looked down the track, as far as I could see I looked down the track, as far as I could see A Little bitty hand was a-wavin' back at me It takes a worried man to sing a worried song It takes a worried man to sing a worried song It takes a worried man to sing a worried song I'm worried now, but I won't be worried long If anyone asks you who composed this song If anyone asks you who composed this song If anyone asks you who composed this song Tell him it was I and I sing it all day long Oh, it takes a worried man to sing a worried song It takes a worried man to sing a worried song It takes a worried man to sing a worried song I'm worried now, but I won't be worried long

Pete Seeger sings Worried Man Blues.
This airbag issue is really more serious than he sounds.

Thursday, November 27, 2014

U.S. House Takata Toyota NHTSA hearing coming up on Dec 3

We never know what's up and what's down, and the basic facts of the auto business.
It seems like the joke is usually on the consumer. At least that much is known.


Engineer XYZ-52 has suggested some interesting questions for  the upcoming U.S. House Takata airbag defect hearing, where Toyota is also summoned to testify:

I’m hoping the following questions get asked and answered at the Takata/NHTSA/Toyota hearing next week.
1.  How many airbags have been produced by Takata over the past 12-15+ years?

2.  To what automakers, models, and model years did these go?

3.  How and why was there a complete breakdown of quality control over at least the past 12-15+ years at Takata?

4.  Are there more Takata airbags affected than have been acknowledged by Toyota and other automakers?
5. How much of Takata's quality problems were known to automakers?

My question: Why can't members of Congress think up good questions like these? 

Wednesday, November 26, 2014

Pressure on Takata plant then--explosion, pressure on Takata CEO now--produce documents

Explosion at Takata plant in Mexico, 2006. 

Did Toyota know about this?
I thought Toyota would audit its Tier 1 supplier quality control more closely.

"Interviews with 21 former and current Takata workers and consultants, along with company presentations and email reviewed by Reuters reveal the pressure inside the Japanese supplier to ramp up output and drive down costs for inflators - the mechanism that triggers air bags to deploy in a fraction of a second after a crash.
The accounts include the concerns of managers that workers broke quality rules to boost output. It isn't clear whether the productivity pressures and quality issues they describe led to specific accidents. But the portrait they draw suggests that top executives at the company were not fully aware of what was going on at the foreign factories that churned out millions of air bags. "

Here is the text of the letter from Sens. Rockefeller and Nelson demanding documents from Takata CEO:

November 24, 2014
Mr. Shigehisa Takada
Chairman and Chief Executive Officer
c/o Takata Corporation, U.S. Headquarters
2500 Takata Drive
Auburn Hills, Michigan 48326
Dear Mr. Takada:
On November 20, 2014, the Committee on Commerce, Science, and Transportation in the United States Senate held a hearing titled, "Examining Takata Airbag Defects and the Vehicle Recall Process." The hearing examined the circumstances surrounding Takata Corporation'smanufacturing, distribution and installation of defective airbags that have been linked to four deaths and dozens of injuries in the United States. The hearing also examined the steps your company is taking to remedy these defects and provide auto manufacturers with adequate replacement parts in order to effectuate their remedial program and protect the American driving public.
At this hearing chaired by Senator Nelson, Mr. Hiroshi Shimizu, Senior Vice President of Global Quality Assurance, testified on behalf of your company. Unfortunately, Mr. Shimizu was unable to satisfactorily answer many of the questions posed to him by Senator Nelson and other Members of the Commerce Committee. Specifically, Mr. Shimizu was unable to provide information regarding the chemical compounds used inTakata's airbags, and whether Takata personnel or internal testing raised concern about the safety of those compounds, as has been widely reported in the news media. In addition, Mr. Shimizu was unable to sufficiently answer many questions about the current production and safety testing of replacement airbags for vehicles currently covered by recalls or safety improvement campaigns. As a result, we still have many significant questions about the circumstances surroundingTakata's manufacturing of defective airbags and their widespread distribution and installation in vehicles sold and driven in the United States.
To help the Committee get answers to these questions, please provide the following information and documents:
1. Copies of any Failure Mode and Effects Analysis (FMEA) or other similar defect or suspected defect analyses that refer to or relate to any Takata inflators or air bag component in which propellant combustion occurs more rapidly than intended.
2. All documents that refer to or relate to pre- or post-manufacturing conditions (including but not limited to high humidity) that may result in propellant combustion occurring more rapidly than intended in any inflator manufactured in whole or in part by Takata.
3. All documents that refer to or relate to any Takata inflator that failed to meet product quality standards or specifications of Takata and/or any of its customers.
4. All documents from any Takata customer that allege any product quality defects or failure of specification in the production of air bags or the associated inflators.
5. All documents that refer to mistakes, errors or omissions made in the production of any Takata inflator including, but not limited to, improper welding of inflators, improper sealing of inflators, use of materials that deviated from specifications, and incorporation of contaminated, recycled or improperly compressed or formulated propellant in inflators.
6. All documents that refer or relate to concerns or allegations (regardless of whether or not such concerns or allegations were substantiated) by a Takata employee or contractor that any Takata inflator was defective or improperly manufactured. Your response should include, at a minimum:
* a March 2011 email from Guillermo Apud titled "Defectos y defectos y defectos!!!!" that stated, when translated into English, "A part that is not welded = one life less, which shows we are not fulfilling the mission," along with all emails replying to or forwarding that email;
* Any communications from Al Bernat detailing any concerns or allegations that a Takata inflator was defective, improperly manufactured, or failed quality assurance testing;
* Any communications to, from, or relating to any allegations or discussions by former Takata employees Mark Lillie or Michael Brittonregarding safety concerns with ammonium nitrate or any other propellant compounds used in Takata air bag inflators;
* A copy of the May 2011 internal Takata safety inspection of theMonclova, Mexico production facility and any associated documents; and
* Any documents related to Takata internal testing of air bags from scrapyards in 2004 that indicated possible defects or improper manufacture of Takata air bag inflators.
7. All documents related to the destruction of any of the documents in Request No. 6. (whether destroyed pursuant to Takata's document retention policy or otherwise).
8. All documents detailing Takata's internal or third-party quality assurance programs in all air bag inflator production facilities including, but not limited to, Takata'sLaGrange, GeorgiaMoses Lake, Washington, and Monclova, Mexico facilities.
9. All documents relating to any air bag inflator production or quality control issues at the Takata facility in Monclova, Mexico following a 2006 explosion and fire at that facility. At a minimum, this response should address whether this explosion and fire was caused by the ammonium nitrate compound used in Takata air bag inflators, and whether Takata made any changes to the ammonium nitrate compound or its production process following this explosion.
10. All documents that refer or relate to changes in inspections and/or quality control procedures as a result of any problems in Takata'sproduction of inflators, including but not limited to, improper welding of inflators, improper sealing of inflators, use of materials that deviated from specifications, and/or incorporation of contaminated, recycled or improperly compacted or formulated propellant in the inflators.
11. All documents that refer or relate to changes in production or production processes as a result of any problems in Takata's production of inflators, including but not limited to, improper welding of inflators, improper sealing of inflators, use of materials that deviated from specifications, and/or incorporation of contaminated, recycled or improperly compacted or formulated propellant in the inflators.
12. A list of every incident involving a death or injury of which Takata is aware of, by any means (including but not limited to media or Internet reports), in which the death or injury was caused, may have been caused, or allegedly was caused (regardless of whether or not such allegations were substantiated) by a rupturing air bag in a vehicle that contained or may have contained a Takata inflator or air bag component. For every incident, provide the date and location of the incident (including city, state, and physical location of the incident), as well as the make, model, model year, state of registration, and vehicle identification number (VIN) for the vehicle. Also state whether the incident involved a death(s) and/or injuries, and provide the names of the person(s) killed or injured, their position in the vehicle, and a description of the injury or injuries.
13. For every incident identified in your response to Request No. 12, all documents related to Takata's assessment of the incident and any documents that Takata or any outside consultant gathered as part of its investigation of the incident (including, but not limited to, any police accident reports, hospital records, or medical examiner records).
14. A list of every lawsuit filed on or after January 1, 2000 naming Takata as a defendant and alleging that an inflator or air bag component manufactured by Takata was defective and/or caused physical injury or death. For each lawsuit, provide the full case caption (including, but not limited to, case number, court, and jurisdiction).
15. A description of Takata's product tracking processes, including:
* Any serial numbers or tracking numbers that were placed on Takata air bag inflators or associated air bag components from the period ofJanuary 1, 2000, to the present;
* Any inventory tracking, process control or quality verification used for the purposes of identifying potentially defective inflator units and notifying automakers who received the defective units; and
* Any tracking process used to identify the number of replacement inflator units that have been placed in service.
16. A corporate organizational chart (s) identifying the employees, by name and title, who have been involved in investigating or decision-making concerning rupturing air bags manufactured in whole or part by Takata. At a minimum, please provide organizational charts for 2004, 2008, 2010, 2011, 2012, 2013, and 2014.
17. A description of Takata's document retention policies, including for electronic mail.
Takata's Efforts to Manufacture Replacement Airbags
18. A description of Takata's capacity to manufacture replacement airbags, including:
* The number of replacement inflator units Takata is currently producing per day (or per week);
* The number of replacement inflator units that have been ordered by each customer, the number of units provided to date to each customer, and the anticipated time it will take for Takata to provide remaining replacement inflator units to each customer; and
Takata's current production capacity, Takata's ability to expand that capacity, and the amount of time it will take to achieve that expansion.
19. A description of Takata's testing program for replacement inflators, including the dates of testing (completed, in process, or planned), the nature of testing and/or test method, the results of testing, and whether the testing was conducted in-house or through a third-party conformity assessment organization.
Takata's Use of Ammonium Nitrate in Airbags
20. A description of when Takata began using ammonium nitrate as a propellant in its airbags.
21. A copy of the United States Council for Automotive Research(USCAR) inflator specification that was applicable to Takata's US airbags for each year starting with the specification that was in place 5 years before Takata began using ammonium nitrate in its airbags and ending 5 years after Takata began using ammonium nitrate in its airbags.
22. For the 10-year timeframe described in item 21 above, all documents related to efforts to re-design Takata airbags or change the inflator specification therefor that were intended to, could have had, or did have the effect of lowering the cost of manufacturing the airbags.
23. For the 10-year timeframe described in item 21 above, a table that includes:
* The model number of each Takata airbag type manufactured during that year;
* The chemical composition of the propellant used in that model;
* A list of vehicle makes/models in the U.S. that utilized that airbag model, along with whether the model was used as a passenger or driver-side airbag, and the numbers of airbags provided by Takata for each make/model;
* The cost per unit of each airbag model sold for each automobile make/model for which the airbag was sold in the U.S.
* For each airbag model, the maximum amount of moisture the Takata generant can absorb before the generant's performance changes, presented as a graph of pressure vs time for varying amounts of moisture.
* For each airbag model, the amount of time it would take for the Takata generant to absorb the maximum amount of moisture referenced above in 100% relative humidity;
* The Design Failure Mode Effects Analysis document associated with each airbag model.
24. All documents Takata prepared for NHTSA in response to RQ09-004 but never submitted to NHTSA.
We ask that you provide this information by December 12, 2014. The Committee is requesting this information under the authority of Senate Rules XXV and XXVI. An attachment to this letter provides additional information about how to respond to the Committee's request. If you have any questions, please contact Christian Tamotsu Fjeld (202-224-1270) or Peter Curtin (202-224-1300) of the Committee staff.
Sen. John D. Rockefeller, IV Sen. Bill Nelson
Ryan Brown, Press Secretary, U.S. Senator Bill Nelson, PH: (202) 224-1679

Tuesday, November 25, 2014

Darius Mehri's perfect 2010 description of Toyota's "poisoned chalice"

Toyota's chalice.

Back during the SUA recalls crisis in 2010, Darius Mehri wrote his thoughts in a WSJ opinion piece. He was blunt. Certainly he was not surprised at the existence of quality problems. He called the Toyota Production System a "poisoned chalice" where the overworked engineers were inevitably led to drink from the poisonous cup of safety negligence. He accurately pinpointed the difficulty of integrating the ECU software with all electronic compenents in the vehicle. 

What was true at "Nizumi," the Toyota Tier 1 supplier where he worked, was likely also true at Takata and at engine ECU supplier Denso.
"Toyota's current recall troubles have justifiably shocked customers who believed their cars were near perfect. But I am not at all surprised to learn that quality issues lurked beneath the company's pristine brand image."
"The Toyota Production System involved a punishing amount of work for its employees and parts suppliers. Projects required meeting strict design and quality goals with unyielding deadlines. It was not unusual for engineers to put in 16-hour days for several months. I remember one engineer who frequently dozed off at his computer while working on an engine analysis. Working in teams where engineers would help each other with their design work helped but it was never enough. Under conditions of unrelenting overwork, it is simply too hard for engineers to produce products without design flaws and too easy for managers to hide those flaws.
Overwork was common at most Japanese companies at that time, and from what I understand this has not changed. This is one of the main reasons for quality problems in Japanese products. Americans however rarely hear of these problems because the products are either redesigned, never make it to the American market or are discontinued. Even in the most egregious cases that involve death, it is rare for Japanese citizens to succeed in class-action lawsuits against corporations, so most companies are lax when it comes to product liability issues.In order to recapture consumer confidence, Toyota must release all the information about the process that led to the design flaws and punish those who may have hidden the problems from the public. In the long run, the company needs to restructure its employment practices to allow engineers more time to design high-quality products. This policy will require less emphasis on gaining market share, and more emphasis on building a healthy and productive work environment."

Question: Has Toyota restructured its employment practices to support quality, four years later?

Notes from Toyota-Land, a book by Toyota Tier 1 engineer Darius Mehri

Book description on Amazon.

In 1996, Darius Mehri traveled to Japan to work as a computer simulation engineer within the Toyota production system. Once there, he found a corporate experience far different from what he had expected. Notes from Toyota-land, based on a diary that Mehri kept during his three years at an upper-level Toyota group company, provides a unique insider's perspective on daily work life in Japan and charts his transformation from a wide-eyed engineer eager to be part of the "Japanese Miracle" to a social critic, troubled by Japanese corporate practices.Mehri documents the sophisticated "culture of rules" and organizational structure that combine to create a profound control over workers. The work group is cynically used to encourage employees to work harder and harder, he found, and his other discoveries confirmed his doubts about the working conditions under the Japanese Miracle. For example, he learned that male employees treated their female counterparts as short-term employees, cheap labor, and potential wives. Mehri also describes a surprisingly unhealthy work environment, a high rate of injuries due to inadequate training, fast line speeds, crowded factories, racism, and lack of team support. And in conversations with his colleagues, he uncovered a culture of intimidation, subservience, and vexed relationships with many aspects of their work and surroundings. As both an engaging memoir of cross-cultural misunderstanding and a primer on Japanese business and industrial practices, Notes from Toyota-land will be a revelation to everyone who believes that Japanese business practices are an ideal against which to measure success.

Here is also a paper by Mehri describing his observations in Japan.
Here's a quote from this paper:
The Role of Espionage in Design. Stealingtechnology and industrial espionage frequentlycame up during conversations with employees atthe company, and it was apparently a fairly commonpractice in the Japanese auto industry. Nizumiwas incredibly secretive about sharing technology.Not a single bit of information about aproduct could be sent out without approval fromabove.

Tokyo Reporter: US Embassy in Tokyo issues "drink spiking warning"

Back to a little tabloid style reporting about Japanese social scenery.

Tokyo Reporter today revealed a renewed US Embassy warning for US citizens in Tokyo--to beware of drink spiking followed by credit card theft, etc. Incidents have been continuing since at least 2009.

(I am familiar with these kinds of embassy warnings from living in Israel, where we normally get them due to missile and terror attacks.)

Somehow or other, this reminds me of dazed US consumers who wake up to find their wallets emptied after falling for enticing ads and then buying defective cars, and have very little real recourse unless they are seriously injured or killed.

Led Zeppelin - Dazed and Confused

The real scene on the streets of Japanese cities differs sharply from the environments inhabited by the country's engineers. However, there is evidence that engineers and other employees sometimes travel in both worlds, and that is one of the ways in which product quality can be forgotten.

Roppongi street scene with claim of hustling

Monday, November 24, 2014

NHTSA acting administrator Friedman: No more [automaker] hiding behind attorney-client privilege

Way too hot to handle.

In last Thursday's Senate hearing, Friedman once again asserted, loudly, that he has put his foot down and told 12 automakers that there is to be no more hiding behind attorney-client privilege. He said that in public, right to the faces of the involved senators.

Furthermore, to my astonishment, Friedman testified that they want every piece of evidence to help them uncover these [safety defect] problems.

[see my prior post on docs too hot to handle]

So Matt Weisman, NHTSA counsel, has still not returned my phone call to rescind his prior claim that Toyota's internal docs are not material for NHTSA to see, until and unless Toyota first checks them for attorney-client privilege.

Where are you, Matt? Your boss has changed the policy. But you haven't. You are still letting Toyota hide.

By this point, a NHTSA admission that they screwed up about Toyota SUA would...well, you can imagine the embarrassment.

Takata share price - leads to risk of company collapse.

Beware, auto supplier / OEM execs.
This is what a deadly defect can do to your share price.

"Shintaro Niimura, analyst at Nomura Credit Research, said that US recall driver-side costs could go up to ¥70 billion, he also warned that Takata could need almost ¥200 billion of reserves in the event of a US nationwide recall that includes passenger-side air bags. [THIS RECALL IS IN THE WORKS]
“If the company makes any missteps, we cannot say that there is ‘zero’ chance of the company dying a sudden death – that is, being hit with excessive debt or facing a cash-insolvency bankruptcy” Mr. Niimura said."

Takata's little bombs - engineer: "Won't that blow up?"

Detonation of an improvised explosive device 
made from airbag inflator substance used by Takata - ammonium nitrate.

This is not what happens inside an airbag. But it illustrates the explosive power of the unstable chemical Takata used, basically, a type of fertilizer that is very easily converted to indusrial explosives and bombs.

Not knowing much about explosives, curiosity overtook me, and I checked into ammonium nitrate, the cheap explosive that Takata chose to use for its airbag inflators that were used in Toyotas and many other vehicle makes.

I think it is highly unlikely that automaker engineers would not know what explosive substance was being used in the airbag inflators. If they knew, why are they not sharing legal responsibility? If they did not know, did Takata mislead them? Or did the automakers not ask? If they did not ask at the vehicle design stage, then they should share the liability. I am reminded of Toyota's failure to ask about the source code in its watchdog computer chip.

Senator McCaskill faulted Takata for the long time that it did not inform its customers about the defect, but I think that is expecting too little of the safety obligations of the automakers.

The New Yorker: the-fertilizer-bomb
"If a lot of energy is needed to split the two nitrogen atoms and break those bonds [of a highly stable N2 molecule] then, conversely, a lot of energy is given off when two nitrogen atoms come together to make the bond. The nitrogen atoms go from a less stable, high-energy state (such as in NO3 or NH4), to a very stable, low-energy state (such as in N2), with the excess energy being released very rapidly, even explosively. It’s not a coincidence that many of the most famous bomb-making chemicals—nitroglycerin, nitrocellulose, trinitrotoluene (TNT), and C4 plastic—are nitrogen compounds."
"So why doesn’t ammonium nitrate explode spontaneously? Because of something called activation energy, which is defined as the minimum energy necessary to start a chemical reaction. Ammonium nitrate’s activation energy is just high enough that it will not explode in everyday use. But provide it with a source of energy, like a flame, spark, or even mechanical impact, and the results can be explosive. “The ammonium nitrate has its own fuel, the ammonium, and its own oxidizer, the nitrate,” making the process self-sustained, explained Jimmie Oxley, chemistry professor at the University of Rhode Island. It’s because of ammonium nitrate’s explosive potential that the Department of Homeland Security proposed an ammonium nitrate registration program in 2011, to regulate transactions involving the sale or transfer of ammonium nitrate at the point of sale."

This diagram illustrates the various chemical phases of ammonium nitrate, and not being a chemist, I understand these on a simple level to mean that the molecular geometry of the compound changes according to density and temperature. It stands to reason that the explosive force may change in accordance with the change of geometry. Anyone can find this in 10 seconds on the Internet. Certainly it would have been easy for automaker engineers to understand.

Here's another tidbit: 
Unstabilized ammonium nitrate continues to grow bigger with each temperature cycle between room temperature and freezing and between room temperature and 120 degrees FThe middle cylinder in the picture to the left shows what happens to a composite propellant with unstabilized ammonium nitrate.. The cylinder on the right is phase stabilized with Dr. Oberth's formula using 3% zinc oxide. It is its original size after a month of temperature cycling. The cylinder on the left was "stabilized" with Urea which obviously was less than successful.
And the NY Times investigative article, quoting Takata engineers:

Why did they not ensure it would stay in the same phase? It seems this was a combination design and manufacturing defect, a terrible problem that arises in quality control in a far-flung global manufacturing operation

Questions: Why have automakers accepted legal responsibility for other kinds of defects, but Takata is on its own? Could Takata be taking the fall for its automaker customers in exchange for their support and continuing business, as would be expected in Japan?

Sunday, November 23, 2014

Japan's "economic war," auto safety defects, and price-fixing

A wave of recriminations has broken upon Japan.

This past week we were torn between gazing in horror at two concurrent Japanese auto industry scandals--first, the Takata airbag defect that remained covered up and unrecalled for far too long as airbags exploded like small bombs and people incurred sometimes-fatal shrapnel wounds that police thought were murder by knife blade. Takata sent an executive to answer questions in a Senate hearing. He prevaricated, mumbled, and after long moments of silence eventually managed some statements that may have kept him a nanometer this side of the perjurious red line. Secret settlements have played an important and awful role in this debacle, keeping the public from knowing the truth until finally it has burst forth and we've reached a crisis point of public anxiety over auto safety.

Second, we heard from Automotive News Asia editor Hans Greimel, who treated us with a dose of truth that I found very unusual to be coming from within anywhere in the auto industry. Big Kudos to Hans who interviewed price-fixer "Mr. X" and gave the world an extensive expose of the inside story of auto parts price fixing practices, basically, business as usual in that business. Mr. X is one of the many Japanese executives indicted and jailed for price fixing of auto parts in the largest anti-trust crackdown in U.S. history. As Hans revealed, these executives are sheltered by their companies in exchange for taking the fall with the DOJ, and in some cases, are fugitives from prospective extradition, basically thumbing their noses at DOJ attempts to enforce US law. I wonder what supplier price fixing does for auto safety.

How do these two affairs relate?

To your simpleminded analyst here, the common denominator appears to be the deteriorated, decadent aftermath of Japan's post-war "economic war," where, in the decades following its military defeat, Japan turned to conquering the world with its products, in a deliberate, coordinated effort to achieve economic dominance and a robust trade balance. In other words, Japan tried and succeeded --by hard work, technical genius, concensus management, lean production, and business cunning--in vacuuming up a nice chunk of the world's wealth, and reaching out to control even more. This economic offensive continued for some decades, but those Asian neighbors among whom Japan had sown the seeds of fierce hatred by its war crimes, then bested Japan at its own game, waging its own war of lower wages, and outstripping Japan's competitiveness in all kinds of products as they evolved into commodities. Meanwhile, the Japanese themselves may have fallen into a social malaise of sorts. This has led to years of economic stagnation. It's a well-known story.

Under pressure, and without any intrinsic sense of right and wrong, some but not all Japanese executives have resorted to a lot of unethical and illegal business practices just to get by with their shareholders, and they have been getting caught for years, but are getting caught more and more. Toyota, as Japan's largest industrial enterprise, cannot help but be involved in these megatrends, both as perpetrator of unethical conduct and as victim of forces that even they cannot control.

How can Japan's big companies get out of these messes and regain the trust of their customers? I humbly suggest that whatever legal and ethical compliance practices that they have been forced to adopt in overseas markets like the US should be pressed into the gray matter of the highest executive ranks back in Japan, and not only at companies with brands, but among the many no-name suppliers as well. When they have really learned that their unacceptable business practices will get them in deep trouble, they need to learn business ethics just as they have learned so much technology and so many other things. In short, they need to apply their learning abilities to the project of learning, really learning, and taking it deeply to heart, how not to make money when lives are at stake. That would be a good start.

Automotive news - secret airbag settlements

Friday, November 21, 2014

Testimony of Lt. Stephanie Erdman, Takata airbag victim--now turned safety advocate

An exploded Takata airbag canister.

Yesterday, the Senate Commerce Committee held a hearing about the Takata airbag defect. Lt. Erdman testified. The hearing has already been widely covered in the press, but I thought her testimony speaks for itself about what needs to be done with US auto safety.

[warning: this testimony document contains a scary image of her injury]

"I believe in personal responsibility. I believe in admitting that you are wrong when you are wrong. I believe in holding companies accountable for their actions. The safety of the American public was not held paramount by these companies. These companies did not play by the rules when they failed to timely and fully notify NHTSA and customers like me about this defect. Something must be done to stop this deadly trend that we see time and time again in the auto industry. I am hopeful that NHTSA’s recall management division also takes more responsibility for overseeing recall campaigns so that they improve completion rates and make sure that all affected vehicles are included.
I am so honored to be here today and to have the opportunity to tell my story. But please understand
that I am just one of many people, along with their families and friends, who have suffered because of these defective airbags.

"I am hopeful that Congress will look at ways to improve the recall notification process. I hope there will be no more mothers taken from their children or fathers blinded so they can never again truly enjoy playtime with their sons. But I worry that, once all of the attention that is now focused on these deadly products subsides, these companies will not follow through with making sure that the defective airbags in every last one of these affected vehicles are removed. I ask that the Committee do everything in its power to make sure that each and every vehicle affected by this defect is made safe."
Meanwhile, let's return a moment to the issue of my (shockingly) popular post about the Japanese porn star who was enlisted to help with Toyota's marketing in Japan. Basically, this arrangement is clear evidence of what we all know already, that automakers use sex to sell cars. But then...let's also be clear, that when the customers have children and build families, these same cars can destroy the families forever. It is despicable that automakers spend money to entice customers with sexy women and sexy cars, while ignoring the most basic engineering for customer safety. As consumers, let's stop falling into this trap and instead focus our attention on safety when we buy a car.

Question: Will Lt. Erdman move Congress to not only pass legislation now, but to make it stick right up through the NHTSA rulemaking process? Please let her voice cut through the smoke and mirrors you will soon get from automakers.

Thursday, November 20, 2014

BIG NEWS: Senators introduce auto industry whistleblower bill


Detroit News reports the introduction of an auto whistleblower bill

The bells tolls for those lost as a result of the heavy silence imposed on all auto industry employees by the lack whistleblower protections to date. But it doubles as a liberty bell for the truth.

"Toyota Motor Corp. in March paid a $1.2 billion fine for its delayed recalls linked to at least four deaths after it was charged with wire fraud in New York. No executives were charged criminally. The Justice Department announced a deferred prosecution agreement with Toyota after it admitted it misled U.S. consumers by concealing and making deceptive statements about safety. In theory, a Toyota whistle-blower could have collected a staggering sum of $360 million under the bill." [more importantly, just think of the lives that could have been saved.]

Last year, I made a quiet inquiry about introducing such a bill, not for my own sake (way too late) but for future auto safety. A friend who knows the Hill did a little serious research, and came back with the sorry news that "no one is interested." So more people had to die because of automaker and supplier cover-ups before Congress "got it" that whistleblowers can lead the way forward. I guess I could grit my teeth and say better late than never, but we can never bring back the beloved people who were lost in the meantime. The word "tragic" comes to mind, but that is not strong enough...

Question: Why does this whistleblower bill, just like all the others, limit itself to "employees" in the auto sector? There are thousands of people who are not employees who know a lot about covered up safety defects. 

Senators, please do not forget this important source of vital safety information. Please revise the bill to include protections and rewards for ANY whistleblower.

[Note: I am not supporting this bill for my own personal gain. It is too late.]

My contempt hearing postponed again--this time at my request

Sooner or later, something will emerge to see the light of day.

This is Mt. Fuji from space, in a photo taken from the ISS.

My hearing is postponed until December 3. I requested it so that David Azar, the attorney who has been with me on this for the subpoena defense, could attend the hearing. He knows all the details of what's transpired since the start of this dispute.

Filed & Entered:  11/19/2014
Text Only Scheduling Notice
Docket Text: (IN CHAMBERS) The Court, at the request of counsel, CONTINUES the hearing on the Order to Show Cause to Betsy Benjaminson, previously scheduled for 11/24/14 at 8:00 AM [4768], to WEDNESDAY, 12/3/2014 at 8:00 AM before Judge James V. Selna. THERE IS NO PDF DOCUMENT ASSOCIATED WITH THIS ENTRY. (kt) TEXT ONLY ENTRY

Wednesday, November 19, 2014

Transparency International ranks Japan near bottom for lack of enforcement against bribing foreign officials

"Never underestimate the effectiveness of a straight cash bribe."
                              - Claude Cockburn

Bloomberg: japan-is-pressed-to-step-up-foreign-bribery-prosecutions

"The [Transparency International] survey of 41 countries that have signed the Organisation for Economic Co-operation and Development’s antibribery convention ranked Japan in the bottom category, with “little or no enforcement” of laws against corruption overseas. Japanese executives working in other countries are solicited for bribes by officials on almost a daily basis, according to Aki Wakabayashi, head of Transparency International’s Japan branch. And sometimes they give in."
"One reason for Japan’s laid-back approach might be that U.S. authorities who prosecute Japanese corporations are already so effective. Under the Foreign Corrupt Practices Act, passed in 1977, U.S. prosecutors can pursue Japanese companies with U.S. operations for bribing officials in another country. "
Question: Has the DOJ investigated Toyota for FCPA violations in its far-flung global operations, including in the most corrupt countries? Better yet, has the DOJ investigated Toyota for bribing American government officials?

@shogannai says #fuckoffdegozaimasu

Japanese corporate "can't be helped" しょうがない

So there is a very cynical guy in Japan who calls himself Shogannai ("it can't be helped") on Twitter, and who kills time all day, every day, tweeting sharp sarcastic cracks about Japanese hypocrisy, idiot politics, dark underbellies, and general bad behavior. Shogannai does not approve of any of this, but he can't really do anything about it. That's why he tweets. That is what his name means in Japanese.

His tagline is "buy the ticket, take the ride."

One of his rants is quite succinct, twitter style.   #fuckoffdegozaimasu  ....this is a perfect rejoinder to Japanese corporate bullshit. That's what I feel like today. Good work Shogannai, you captured my mood perfectly.

Shogannai has 4,852 followers.
He must have something to say.

Bonus: a cute foreign student giving a "culture shock" lesson about the real-life meaning of "shogannai"

She is cute, but she is a tad naive.

Tuesday, November 18, 2014

Speech at Israel Society for Quality conference

The nuts and bolts of truly serving the customer.

Today I gave a very short, rather off-the-cuff speech at the "Recall" session at the 20th International Conference of the Israel Society for Quality. This year's conference theme was "Creating Customer Centric Culture." The conference program was full of the most amazing speakers, and I was honored to play even the smallest role among them.

My topic was Auto Recall DISASTER. The point was to scare the audience into making thorough plans for recalls, and in particular to motivate them to implement the ISO 10393 recalls standard.

Here's the slide deck. Time was too short, but I did what I could. None of this information is exhaustive, of course, and none derives from other than public information sources.

After my talk, at the luncheon, I happened to meet an executive of a quality organization whose members are major global corporations. She had just spoken. I asked her if Takata was a member of her organization, and she said yes. Pitiful. What were they doing?

She said that Toyota is not a member.

slide deck

Monday, November 17, 2014

Open letter to Sen. Blumenthal -- ISO 10393, Consumer Product Recall Process

ISO 10393 - a workable way out of the messy recalls problem.

Dear Senator Blumenthal:

I am writing as a citizen advocate for auto safety. 

As you prepare for this next round of Congressional hearings on yet another lethal auto safety defect, I would like to suggest a few solutions to the seemingly endless problem of serious defects that remain concealed and unrecalled for far too long.

First, I respectfully suggest that you introduce legislation requiring NHTSA to formulate new, transparent recall policies and procedures adapted from the new Consumer Product Recall Process Standard, ISO 10393, and the Auto Industry Functional Safety standard, ISO 26262, and that requires automakers to implement these standards as well. I also support your efforts toward the goal of imposing criminal penalties on automaker executives who conceal lethal safety defects, and on discouraging or prohibiting US courts from approving secret settlements in cases of known dangerous products.

Please also note that numerous past auto safety defects have remained incompletely investigated. Automakers know that 'time heals all wounds' and that once they pass the scrutiny of a defect investigation or safety scandal, anything undiscovered can remain that way. They know that NHTSA and also Congress often let issues fall into the history books, not reopening them no matter how much new evidence may emerge. Then the public remains at risk and auto executives are not held accountable. This should change.

Toyota unintended acceleration is one such case, where NASA's investigation, claimed to be "exhaustive" at the time, has since been revealed to have been very "partial," and it is now conclusively proven by expert analysis of Toyota’s ETCS source code that Toyota made material misstatements and omissions to NASA during the course of their technical study, whose conclusions would have differed had NASA known the truth. I believe that it would serve public interest to reconsider Toyota's statements and open a new Congressional investigation on the basis of the new evidence. Does Congress have the will to do that? Please lead the way.

In addition, I respectfully suggest that this and all other suspiciously closed informal and formal NHTSA defect investigations be re-opened, but by the NTSB, not by NHTSA. Given NHTSA’s track record, this makes perfect sense.

Thank you very much for considering these issues. Please kindly address any answers or questions to me at autoelectronicssafety at. gmail dot com. Thank you.

Betsy Benjaminson
(A U.S. citizen living in Sderot, Israel)

Automotive News Hans Greimel digs deep into Japanese cultural underpinnings of price-fixing; extradition risk rising

Mister X.
"the man who never dies"

Hans Greimel has written an extremely interesting article about the Japanese aspects of the price-fixing crackdown, including an interview with one of the jailed executives, now back at work at his company.
Confessions of a price-fixer; supplier network shelters fugitives, ex-cons


"the handling of some cases and a trend of execs trying to evade justice also have exposed a rarely seen underside of Japan's business culture still at odds with international norms."

"Thirty-one parts suppliers, mainly Japanese companies, making everything from wire harnesses to wiper switches, have pleaded guilty or agreed to plead guilty in the crackdown since 2011. Forty-six individuals, almost exclusively Japanese, have been charged. The indictments continue, with two more individuals indicted on Nov. 14.
No one has challenged the charges in court; 26 individuals agreed to prison instead. Another 20 have yet to enter pleas or are otherwise ignoring their indictments.
A review of the cases by Automotive News finds some of the execs are still in Japan, gainfully employed by the suppliers for which they are charged with rigging bids."
"It's like the Mafia," complained one Japan-based executive at an international parts supplier. "The boss says you can come back after doing your time. Just because it's the Japanese way, doesn't mean it's right."
"Suppliers argue that the relentless pressure from automakers to annually cut costs creates a fertile field for suppliers to circle wagons in an effort to stave off predatory pricing."
Question: What responsibility do Japanese automakers have to their suppliers as the execs are herded off to jail? If it is to keep doing business as usual, they are doing that. 
Japanese feudal loyalty at play here...

Saturday, November 15, 2014

U Md "Psychologist of Morality" C.Fred Alford: re Whistling girls and crowing hens

Whistling girls and crowing hens
Always come to some bad ends.

Dr. J.Fred Alford is a political scientist who describes himself as a "moral psychologist." He is a professor of political philosophy at the University of Maryland. 

Review 1 with quotes from Alford's book, Whistleblowers: Broken Lives and Organizational Power
"To be a whistleblower," writes C. Fred Alford, "is to step outside the Great Chain of Being, to join not just another religion, but another world. Sometimes this other world is called the margins of society, but to the whistleblower it feels like outer space."
Alford paints a picture of the way organizations behave when confronted by an outspoken member who has observed organizational misconduct—and the rationalizations of its members who remain silent. The picture he paints is sobering, even troubling.

Alford is sceptical of the heroic accounts in which the courageous employee brings a corrupt organisation to account, benefiting society and receiving society’s gratitude. Instead, he has a much darker, more pessimistic message. Nearly all whistleblowers are destroyed. They lose their jobs, their careers, their houses, their friends, their families. But that is not the worst part. Most catastrophically, whistleblowers lose their trust in people and justice. 
For whistleblowers, the book has passages that will be illuminating but also agonising. In telling their stories, over and over, whistleblowers typically go through a sequence of events. This, Alford thinks, serves as a substitute for telling a story that has an ending and a real meaning. The problem is that whistleblowers don’t want to recognise the underlying truth, which is that there is no justice in the world and that organisations operate on the basis of power, not morality. If they recognise this truth, then their own actions become pointless. What is the use of behaving morally in a world without justice? Even when whistleblowers are later vindicated, it doesn’t really help. As Alford asks, "What is the satisfaction in being right if as a consequence one has to give up everything one believed in?" (p. 51).
When whistleblowers lose their trust in people and organisations, they enter a new sphere of meaning, or perhaps lack of meaning. "For some, the earth moves when they discover that people in authority routinely lie and that those who work for them routinely cover up. Once one knows this, or rather once one feels this knowledge in one’s bones, one lives in a new world. Some people remain aliens in the new world forever. Maybe they like it that way. Maybe they don’t have a choice." (p. 52).
Alford says that "The whistleblower is a political actor in a nonpolitical world." (p. 97). By this he means that the whistleblower acts on the basis of values within an organisation where values have no role. Within the organisation, the main rule is to do what the boss wants. Anyone who imports values into the organisation from the outside, such as public safety, fairness or honesty, is a threat to the line of command and must be expelled.
Because of the unremitting hostility of bosses to whistleblowers, laws do little to help, since ways are easily found of getting around them. In th US, there are hundreds of laws protecting whistleblowers, but they are little help. "At a conference on the legal protection of whistleblowers, every lawyer who spoke agreed that the laws do not work very well and that new laws rarely help." (p. 108). Organisations have much more money and much more time: $100,000 and ten years to run a case is commonplace. Alford says that the law makes the "autonomous ethical individual" expendable (p. 113).