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Cost of Quality (Honda)
a) What specific quality problems were reported?
There were problems with Honda’s vehicle air bag system. Some air bag which was
manufactured by Takata Corporation could potentially detonate sending lethal shrapnel causing
shock, severe injury and even death to the driver and their passenger. The airbag’s detonation was
triggered by the inflator which is packed with ammonium nitrate without a chemical drying agent.
As most people that buy Honda vehicles drive them every day the vehicle is exposed to most of
the elements such as moisture, changing temperature, and as air bag gets older the chemical inside
the inflator became unstable and explode. U.S. statistic have shown over 10 deaths and over 150
injuries due to Takata Corp’s exploding Airbag. As a result, Honda have to issue a worldwide
recall of their vehicles.
b) What are some examples of external failure costs related to the recalls? What financial
estimates are available?
