U.S. Markets close in 6 hrs 5 mins

Honda Recalls 63,200 More Vehicles with Faulty Takata Airbag

Zacks Equity Research

Honda Motor Co., Ltd. (HMC) recently announced a global recall of 63,200 vehicles with faulty Takata-made driver-side air bags. Takata is one of the leading global suppliers of automotive safety systems and products. The vehicles recalled include CR-V, Civic, Brio and Amaze of the model year 2012-2015.

Honda revealed that a major portion of the recalled vehicles is from China and other Asian countries. The remaining vehicles are from Europe, Latin America and Africa. Notably, none of the vehicles from North America have been recall.

Honda said that the driver-side air bags manufactured by Takata had an inflator which was produced with a faulty part. Thus, when the air bag is deployed, the inflator can explode and shoot out metal fragments in the vehicle. However, there is no report of any casualties related to this defect.

In June this year, Honda recalled 2.03 million vehicles globally due to malfunctioning Takata-made airbag inflators. Of these, 1.02 million vehicles are from North America and nearly 669,000 are from Japan. The recalled vehicles included Civics, CR-Vs, Odysseys and Elements manufactured between 2000 and 2005. The Japanese automaker recalled nearly 1 million vehicles for the same problem last year.

Also in June, automakers like Toyota Motor Corp. (TM), Honda, Mazda Motor Corp. (MZDAY) and Nissan Motor Co. Ltd. (NSANY) announced recalls owing to defective Takata airbag inflators. All these automakers, along with BMW, recalled 3.6 million vehicles with defective Takata airbags last year as well.

Since 2008, auto manufacturers have recalled a total of 12.3 million vehicles globally due to faulty driver-side and passenger-side air bags produced by Takata.

The recalls are set to increase further as the NHTSA has requested seven automakers to announce recalls in regions with high humidity such as Florida, Puerto Rico, Hawaii and the Virgin Islands. About 3.5 million vehicles are expected to be recalled from these high-humidity areas in the U.S.

Currently, Honda carries a Zacks Rank #3 (Hold).

Read the Full Research Report on HMC
Read the Full Research Report on MZDAY
Read the Full Research Report on TM
Read the Full Research Report on NSANY

Zacks Investment Research