captioning performed by vitac we recalled based on that information. we expanded the recall when another different manufacturing issue was brought to our attention by takata, and in all, we did four recalls from 2008 through 2011. i think it's important for the committee to understood that those four recalls which we did had no geographic boundary. they had no geographic boundary, and the injuries that have occurred from ruptured -- there have been 45 injuries because of ruptures in honda vehicles.

43 of those correlate to the time of those takata manufacturing concerns. and to our regret, all four fatalities correspond to that same time. so we're talking about recalls that were done 2008 to 2011 because of different manufacturing issues that takata made us aware of, and is pretty strong data that shows this is where the majority of the problems have been occurring, and those recalls were national -- >> i understand. i wasn't saying they were regionally limited. it's just, you have recall after recall after recall, when clearly there's these red flags. and the reason it matters so much to this constituent, who is permanently blind, is this was in 2013. it just seems that it's a different manufacturer, but if takata had done a more global look at what was happening, and by global, i mean, in all their air bags, i don't think this would have happened. so i think to you, that is on november 6th, a "new york times"

article reported that takata secretly conducted tests in 2004 at your auburn hills michigan location in response to the release of metal fragments issue, with the honda accord. and according to the article, two of the steel inflaters allegedly cracked during the test. and takata executives ordered the testing data deleted and the air big inflaters destroyed. takata has disputed the reports, saying the story was based on some misunderstandings. what specifically about the report was inaccurate? >> yes, senator. again, regarding the incident of a honda vehicle in 2004, according to my knowledge, it was informed to takata on may 2005. so there is no way we can do any test relating to that incident

beforehand. and also, the instant happened in 2007, and at that time, we actually started investigation about -- to identify the problem. and at that time, we have the test and all test result since 2007, at the starting point of the investigation by us, is a shared with automakers and also nht nhtsa. >> so just to get to the -- you can go back to 2004 or another time in writing, but my issue is my constituent got blind in 2013. so in 2010, bmw sent a letter to nhtsa, that it was aware of the takata air bags under honda recalls. and of course she was driving a bmw, but that -- it had received indication from takata indicating that bmw vehicles were not affected.

so what documentation did takata provide to bmw? because, remember, this is post-2007 now. we're not in 2004, we're in 2013. so i'm afging specifically about bmw. and if you don't know, you can send it to me letter. but i want to know what documentation was provided to bmw about their situation. because they told nhtsa that they knew about these problems with honda's recalls, that they had received documentation from takata, indicating that bmw vehicles were not affected. >> senator, can i comment on one thing? is it driver side air bag -- >> i believe that this was driver side, yes. >> yes, i will answer based on what i know. we do the recall of the honda

vehicle at that time. and as you mentioned, as a senator, an indicator called the psdi. and it's a dual stage driver side indicator. at the time, the bmw we supplied to bmw is a psdf 4. and it's a construction -- a structure of the company. looks same from our side, but different from psdi, and produced in a different line. so that's the reason that the psdi was recalled, but we answer to the bmw, the psdi 4 is a different structure, so it won't be -- >> so when did you -- this is my last question. when did you become aware that there were problems with the bmw? air bags? >> i'm sorry? i'm not --

i don't know the actual date. >> all right. thank you. >> just so it's clear to everybody, what we're talking about, this is the steering, middle of the steering wheel. this is the inflater. and it fits in there and then when the impact occurs, the explosion is supposed to come this way, but as we said earlier, if the explosive force is too great, it breaks off this metal and the metal starts coming through the middle. every one of this at this hearing table have had constituents affected by this. in florida, right in central florida, we've had one death.

and in the case of cory burdock, a firefighter, he has no eye now for the rest of his life. very similar to the situation of the lieutenant, but in this case, the metal had penetrated his actual eye. so this is why we're so concerned about this and to get to the bottom of this. senator ayotte? >> i want to thank the chairman and the ranking member for holding this very important hearing. i wanted to follow up, mr. shimizu, on a question that senator klobuchar had asked you about with regard to the report in "the new york times" about the 2004 secret tests by takata. as i heard your testimony in response to her question, you said that takata wasn't informed

until 2005 about a particular incident. and what incident was that? >> the incident happened in 2004 at honda vehicles. and the driver was injured. >> okay. and then you said that there were a series of incidents in 2007 that prompted an investigation within takata? >> yes. >> when was nhtsa first notified? of any of this? >> it's, according to my knowledge, each incidents happened during 2007. that's the actual trigger to deeply investigate the cause of the problems. >> why wasn't when you -- with the 2005 incident, was there any investigation conducted within takata? >> we did. it's -- we received the picture,

but we received a picture and checked the picture and also record. under serial number provided. and then, as i said recognized an anomaly from the picture. however, the old record doesn't show us any system or any abnormality from the record. and then other times, there's not enough evidence at the time we believe is required further investigational action at that time. >> so you didn't take any further steps to investigate the anomaly that your engineer saw? did you report it to anyone or talk to nhtsa about it or honda or anyone else? >> according to my understanding, we didn't inform

nhtsa, but we report back to honda. >> throughout this, i would like to understand whether takata believes that as it receives reports, and i would like to also inquire of mr. shastac from honda, when it received reports of both reports of injury and unfortunately these horrible incidents of death, when do you believe that you reported them to nhtsa and do you believe you have complied with the tread act? >> let me answer that, senator. and if i might, to supplement the discussion you've been having with mr. shimizu, the first event of a rupture, in a honda vehicle, occurred in 2004. we have received notice of that event through our legal department in may of 2004.

we are still checking our records, but as mr. shimizu said, what we can find now is that we provided that information to takata in 2005. we did report that 2004 event on our tread report, which is provided to nhtsa. as we were discussing, in 2007, there were several events. it was at this time that we and takata engaged in the beginnings of an investigation. ultimately in that investigation, takata has made us a presentation that shows the 2007 events and the manufacturing deficiencies that caused the defect and also compared it to that 2004 event. the 2007, those manufacturing times clearly show improper

density in the inflater propellant. the 2004 event, ultimately, it was fully investigated and it shows a proper density for the inflater propellant. so it's not an excuse, senator. that information we could have gleaned maybe sooner in 2004, would not have helped us predict the events in 2007. as we look back on our activity, i think we acted with urgency. but do i think there are -- we could have moved faster in some respects, i absolutely do. have we met our obligations to report tread? we have not. and i think as the committee may know, we have an ongoing internal review about that process. that information is due to be provided by honda to nhtsa on monday, this coming monday. we will provide it on time.

and we will share with them any gaps or deficiencies in our tread reporting at that time. >> so i know that my time is expired here, but let me just say that i echo the comments of my colleagues. this really does warrant a thorough investigation, the reporting requirements, the questions that have been raised, and as you know, gm undertook this activity with regard to the ignition switch, and given the seriousness of this matter, i would think that takata and honda would want to undertake the same, so let me urge you to do that as well. and my time is up, but mr. consulman, let me just say, i'm troubled about the december 19th piece, because i think you should, instead of waiting for people to call you with concerns, should affirmatively reach out to your customers,

while they're waiting until december 9th, regardless of how you view the beta air bag differently than the alpha. so i think that -- i'm very concerned about the december 19th date. thank you. >> thank you, senator ayotte, for underscoring that point. senator helen? >> mr. chairman, thank you. and to the ranking member, thank you, alsoing with for having and holding this hearing. mr. shimizu, i did read your testimony. and it does discuss your anguish, and i can understand that. your commitment to addressing this issue properly and promptly. however, i think there was something that was a miss in your testimony, and that was that nowhere does it say that takata takes full responsibility. so i want to ask you right now. does takata take full responsibility for this tragic defect? >> excuse me, can i ask

[ inaudible ] your question? >> sure. >> senator, can i confirm the tragic this time, which tragedy are you talking about? >> i'm talking about the five deaths. >> five deaths. five deaths? >> do you take full responsibility for those tragic deaths? does takata take responsibility? >> uh, we recognize the three victims' case is relating to our

proble problems. >> so, okay, let's take the three. does takata take full responsibility for those three decemb deaths? >> my understanding is the, uh, our products in this accident were anomalies. so that caused accident. from the sense, yes. >> okay. mr. shastac, i got a phone call from my wife recently, a "good morning america" piece was done on this issue. and she's probably doing what every parent is doing in america today. we happen to own a 2007 honda

civic. and we didn't buy it brand new, so we probably didn't get recall notices on that. and my wife would remember if she did. and i'm going to give to you the same question that she asked me. if our 18-year-old daughter were to drive that car today, a 2007 honda civic, would she be safe? >> senator, we have several different analysis of what the problems are with these air bags in our vehicles. as i mentioned before, the recalls that we did in 2008 through 2011, we have connected to those two takata manufacturing issues and we urge customers -- and those have no geographic limits. we urge customers to get those vehicles repaired, because there is a risk.

there is a risk. with regard to the more recent regional recalls, where there is not as much information available as to what is the cause of the ruptures in the air bag, where there is a concern about humidity, and we have the same concern about humidity, we look at the 45 injuries that have occurred, 17 of them have occurred in florida, also puerto rico and texas. the large majority of these issues are occurring in southern areas. so, we are trying to understand if there is any additional risk out there, and when we find risk, we act to recall. it's our responsibility to recall those vehicles, when we find risks. >> as a parent, we did run the vin number through nhtsa's site, and they said that a 2006 or earlier vehicle would have been subject to the recall, but not

2007. how can you assure me today that a 2007 vehicle is safe for any young adult? on the road to drive today? >> senator, with your indulgence and understanding that i'm not sure of all the exact models, as i sit here -- the break points in terms of the recalls. if that vehicle was subject to a recall, we want it fixed. if that vehicle was not subject to a recall, we have not determined risk, so we would deem it safe for the driver. >> we had a conversation earlier in my office, and you said it was difficult to determine the safety of the device because of proprietary reasons. would by accurate in assuming that you can't be assured, 100% assured, not knowing what the necessary changes that were made in these air bags? >> senator heller, we are not chemical propellant experts. as honda, there is proprietary

technology involved. there have been improvements made by takata, as time has gone on. for example, there's been -- there's differences in the shape of the propellant wafer. for me, i'm not an engineer. for me, as a layperson, it makes sense that that different shape may result in better manufacturing process, but respectfully, senator, i would defer questions about the intellectual property and the proprietary aspects of the chemistry to takata. >> thank you. mr. chairman, my time has run out, but i think i represent every parent across america concerned with their young adults and the cars that they're driving today, as to whether or not they have a air bag sitting in front of them today that may cause severe injuries, as we've heard in testimony today and even deaths. anyway, thank you. >> senator heller, let the record show that the pauses that

occurred to your two direct questions to the two gentleman, that those pauses, i can say for this senator, were painful. and perhaps on the basis of mr. shastac's response, you better tell your daughter not to drive south in her honda. senator markey? >> thank you, mr. chairman, very much. in the audience today is kim cough. kim is sitting right over here. her sister was killed in a arizona in november of 2003, sitting in the passenger side of a subaru model that contained defective takata air bags, but that subaru model has only been recalled in humid states, which

arizona certainly is not. so my first question to you is, mr. shimizu, would you, first of all, right now, given your testimony, agree with the position that nhtsa has taken, recalling that you have said so far that takata strongly agrees with the position stated by nhtsa that the recalls be limited to the so-called humid states. but on tuesday, nhtsa finally changed its position and a nationwide recall. does takata support nhtsa's new nationwide recall? >> i understand nhtsa changed

from recall to national recall. the reason behind is, i understand is one incident that happened in north carolina. but do you agree or disagree with nhtsa's call for a nationwide recall, mr. shimizu? >> senator, it's hard for me to answer yes or no, so if you allow me -- >> it is not hard for you to answer yes or no. do you support the nationwide recall of air bags that the department of transportation has issued? yes or no? >> again, senator, if we -- i did find the particular data from any incident to support

nhtsa's new directions, and with automakers to take care of the issues. >> i'm going to take this as a no, you do not agree with the decision by nhtsa. and i just think you're plain wrong here. and i think that it's very disturbing, i think, to any american family who has a vehicle with a takata air bag to think that that's your position today after all that we have learned. i think your company is making a big mistake in not supporting this recall wholeheartedly. let me move on, if i can. kim cough's sister was killed with a passenger side bag. and i think that there's kind of a roulette like quality like this. hoping that the air bag that was installed in people's cars was on the driver's side. that's now being recalled, but not the passenger side.

i don't think that's right. i don't think anyone should have to worry that any of their family members are in danger. kim cough has lost her sister. forever. does honda support a recall of passenger side bags as well, given what we now know about the ticking time bombs that each one of these air bags potentially is, as a risk to american families? >> senator markey, there are two confirmed air bag ruptures, passenger air bag inflater ruptures in honda vehicles. we have not experienced any injuries. they are part of the sic or the improvement campaign. we have actually recalled in, i believe it's ten states, passenger air bags. we are actively working on that right now. again, those are concentrated in the --

>> do you support passenger-side recalls that would be the equivalent of the driver side recalls for these air bags? >> we support passenger side -- we have ongoing a passenger side air bag recall and for us, the key is to understand what the technical information is -- >> do you support, not a voluntary or geographic recall, but a nationwide recall of passenger side bags, yes or no? >> as to a national recall, we have not refused. we're actively considering that, senator markey. right now, our priority -- >> the answer right now to that, mr. schostek. do you support a nationwide recall? not volunteer, not geographic, nationwide? yes or no? >> respectfully, senator, i want to point out that the answer to this question is obviously one that we interact with nhtsa on

and make decisions quickly based on the data. i haven't received that specific request, but i would respond quickly, using our rigorous internal process to make that decision in a five-day period. >> look it. these air bags are the same, whether they hurt the lieutenant or they kill kim cough's sister. they're the same. and they should be recalled. and each of you should be today saying that you support that wholeheartedly. thank you, mr. chairman. >> thank you, senator. thank you for making it so direct. yes or no, just like senator heller did as well. senator blumenthal? >> thanks, mr. chairman. you know, i know that you're here in good faith, so i hope you won't take anything i'm going to say personally, but, you know, it strikes me that these air bags failed, but the

system failed equally, if not more. and, first of all, i want to join senator markey and his calling for a national recall of all cars with these air bags on the passenger as well as the driver's side. we've made that point previously, he and i. i'm also calling on the secretary of transportation to immediately accelerate the replacement process, looking forward, at the current rate of production by takata, of 300,000 air bags a month, there is no way that there are going to be sufficient products available. so, i ask you, will you cooperate in an accelerated replacement process, so that competitors of takata will be called upon to supply those products instead of takata?

to each of you? >> i can start. obviously, i mentioned again that we have an obligation to our customers. accelerating the production of parts and getting this process done quicker is directly -- >> so that's a yes? >> i agree. and mr. schostek, will you take non-takata parts to replace those air bags? >> senator, we wanted to get these cars fixed. the safety of our customers as the highest priority. all options are on the table. we will look at every option. >> well, i'm going to ask the secretary of transportation to order that you do so, but i hope you will cooperate. when i say the system failed, we're here because of delay, nondisclosure, as well as

potential deception, and concealment. in fact, both of your companies entered into settlements that were deliberately and purposefully concealed in court orders. damian fernandez in florida, ashley parham, the first in 2006, ashley parham in oklahoma city in 2009, jennifer griffin, orange county, florida, 2009, gurgette rathermore, virginia, 2009. the first was driving a chrysler, the others were driving a honda. your companies settled with them. if that information had been made public, more people would know about this deadly defective air bag and fewer people would have been killed.

do you agree? >> mr. councilman and mr. schostek. >> respectfully, i would highlight that that incident did occur in the fall of 2013 and i highlighted it in my opening statement. and while it's our policy when we enter into confidential settlement terms that the existence of that incident was not concealed in any way -- >> but the details were, and the devil and the death was in the details here. don't you agree? >> i would ask for a definition of details. >> well, the details of how and why and what the role of the air bag was in that crash. mr. schostek, do you agree? and let me ask both of you, will your companies commit to declining from now on to enter

into these kind of secret settlements and concealing the facts resulting from defective products. >> senator, two of the cases you cite, with miss parham and miss rath rathdmore. we've talked about them to takata. >> but not to the public. you -- your company deliberately concealed the facts that otherwise would have been known to the public as a result of this court action. >> i respectfully disagree. her case was reported in the tread material. i understand your point that miss parham's was not. but we were in talking to nhtsa 16 days after that tread report was due, giving them all the information we had about inflaters. with respect to confidential settlements, our legal system rebzs confidential settlements,

so we do not intend to hide behind settlements. the safety information that comes out during lawsuits would be available to nhtsa and we could support others as well. >> i want to show you some standards that are used in testing american cars. these are standards used to test. they are specifically required by american law to test with those standards used prior to the sending of those air bags to these american companies.

>> i'm not sure about this, but i'm sure the company knows about this. >> somebody in your company knows about it, but you don't know whether those standards were used? >> nothing either. >> well, i would like to get an answer from you in writing after this hearing, that these standards, your u.s. car 24 standards, they'll apply to the substances used in the air bag, the hermetic sealing of the those air bags to protect them from moisture. you are unable to provide this committee an assurance that those standards were used and applied. . i want to know from someone in your company, under oath, whether those standards were applied to every air bag design. in other words, if the designs were changed over years.

and whether they were tested with those standards, when there were reports of defects. >> senator, yes, if you allow me, i'll talk to our engineers and as i get back to committee about the response. it is acceptable. >> thank you. >> and let me just conclude, i hope that your companies will join in supporting the legislation that i've been produced that would prevent these kind of settlements that contributed to the problem. the courts ought not to be complicit. and i hope that your companies will cooperate and join in supporting these kind of legislation. thank you. thank you, mr. chairman. >> is your company the only company that uses ammonium nitrate, that manufactures air

bags? >> senator, i don't know in details what kind of materials exactly our competitors are using, but i had some of the competitors also using a kind of materials. >> the information we have is there are four or five companies that make air bags and your company is the only one using ammonia nitrate. let me ask you this question, are you still using ammonia nitrate in the manufacture of your air bags? >> yes, senator. >> well, that's worrisome to me. let me now move to chrysler and honda. i'm confused, and i guarantee you if i'm confused, your customers are confused. the letter that chrysler sent to nhtsa on june 20th, 2014, i would like these three letters to be made part of the record, mr. chairman, if we could. listen to this paragraph. "although chrysler has not at this time made a determination of a defect in the subject of air bag inflaters, it is

chrysler's intention to conduct a field action to replace the driver air bag inflater between june, as well as the passenger air bag inflaters." i'm guessing a lawyer wrote that paragraph. because we have a letter from honda that says, we've discovered a potential defect related to motor vehicle safety exists. that was written in 2008, and we have another letter from honda in 2014 saying, we've decided to conduct a safety improvement campaign. we have not made a determination that a safety defect exists. then you go down the list of the notifications. and i'm going to start in june of '14. we have a service campaign, then a service campaign, then a honda safety recall, and then a mazda service campaign, and then a mitsubishi service campaign,

then a nissan safety recall, then a nissan service campaign, then a nissan safety recall. then we have a subaru safety recall, then we have a subaru service campaign. do you understand the issue here? what's going on here is a refusal to characterize a problem in a way that is clearly understandable to the consumer. we have had more recalls in the last year and a half in american car manufacturing in the history of american car manufacturing. probably more in the last year than we've had in many, many years combined. the problem is, i don't think that people that are driving these cars understand the risk. because you guys aren't even comfortable with being consistent as to whether or not you're telling nhtsa it's a service campaign or a safety recall. in your mind, mr. councilman, other than avoiding litigation and liability, why would you differentiate between a service

call and a safety recall? >> yes, senator. i would like to start by saying it's chrysler's policy, that regardless of which ways these actions are initiated or how they're characterized, recall or field service campaign, the customer-facing information is identical. we put the same information with nhtsa and the mailings that go to our customers are the same. >> so do the mailings say that this is a safety recall, and you are in danger and you need to get this car in? or does it say, this is a notice that this has been -- this part has been recalled, without any emphasis on safety? >> it's my understanding that it does characterize it as a safety concern, yes. >> well, i would like to see for all of those ones that involve your companies, all the service campaign versus safety recall, i would like to see the notices that went to your drivers. >> okay. >> i would like to see the language of those. and if, in fact, the language is

the same that goes to the drivers, why is the language different to nhtsa? >> i guess the characterization, in terms of how we characterize these events. again, chrysler is agreeing to do this with one incident and a lack of understanding of root cause. i know this will sound like engineering terminology, but the thing that is still open in this instance with these beta inflaters is an absence of a defined root cause. in absence of a defined root cause, it makes the next steps difficult in terms of what to do. i think this is a nuance of definition as to why you see these characterized this way. >> and mr. shostec, you say the reason there's a difference in characterization to nhtsa, is your notification to your drivers identical as to whether or not it's a service campaign or a safety recall? >> you know, senator, i think there is confusion here. and the regulatory framework that we're operating under has

certain terms that are part of that regulatory framework that we are using. i'm not an engineer. i've asked the very same question you have asked. what's the practical difference for the customer? and i've been told none. that they need to bring their car in. now, behind -- in terms of how we're looking for evidence of risk and so forth, that should be the manufacturer's responsibility, working with suppliers and working with nhtsa. but senator, i would support, if we could make this clear for consumers, honda is happy to work with -- >> are you sending the same notification to your drivers, whether or not it's a safety recall or whether or not it's a service campaign? >> senator, i would like to double check, but i believe there are very similar notifications, whether it's a service campaign or a safety recall. our interest is to tell that customer to please call, please come to a dealership, please get the part replaced. whether that replacement is for the purpose of an identified defect, the recall, or the purpose of getting more

information, which is the safety improvement campaign. i think we should help the consumer by not having it be so unclear to them. >> well, i tell you what, if i get a letter saying we're investigating something, would you bring your car in so you can help us, i'm busy. if i get a letter that says, you know, if you drive this, you could have a piece of shrapnel embedded in your eye, or you could die, that's a lot different than, hey, we're checking out an investigation, could you bring it in so we can check it out. i mean, i think that too many lawyers are in the -- i mean, we found this in gm. you all know, you had to have followed it closely. there were lawyers that were trying to avoid litigation. there were not lawyers that were trying to make sure every consumer knew the danger. and we have got to get out of this defensive crouch about liability litigation and get into an offensive position about making sure drivers are safe. and until your companies decide to do that, until nhtsa is a

more able and aggressive partner in that, consumers are going to be in the dark. i mean, the exchange between senator heller about whether or not his daughter was safe was incredible. he's a united states senator and he's asking somebody in charge of the company that made his daughter's car whether it's safe for her to drive it and it was clear, you weren't sure how to answer it. that's a problem. we've got a problem. so we're going to keep having these hearings and keep working on legislation, and we're going to keep yelling at nhtsa until we get this right for the driving public. this is unacceptable. thank you. >> thank you, senator. senator cantwell? >> thank you, mr. chairman. and i would like to follow up on a couple of points that my colleagues have made and i share their frustration and angst over this situation, when there's such a pause or, you know, it's,

we're just doing what nhtsa says. i think today's hearing is a very good opportunity for us to discuss what are the changes to be made. not what nhtsa requires today, but now that we're here, what do we need to improve the situation? but first i want to follow up on this air bag recall situation as it relates to the passenger side. so i wanted to ask you, mr. shimizu, if we actually -- would you be able to meet demand if it was for all the passenger side air bags. would you be able to meet that demand, or do we need the secretary to help in expediting this with other manufacturers. so i heard mr. schostek say, you know, well, it was to senator blumenthal's question, there was a little bit of -- i read hesitancy into that. we'll see what nhtsa says. i'm asking you now, can you meet that demand on the passenger side bags? if not, let's get to the bottom line here.

>> we committed to provide a replacement kit, which is in the beginning of this recall of the passenger side air bag. currently, we are producing 300,000 kits per month, in total, and then it's, we understand, we have to speed up to provide replacement kit. we also committed in the beginning. and we have to do as committed and supply the replacement part s. and also, we do some airport. so we have four inplaiter plants globally, and then the plant in mexico is mainly producing for replacement and they are running full capacity right now.

so we found out, it has some extra capacity. so we decided to move some of the products from mexico to germany to open up the capacity in mexico, so mexico can open up some capacity to direct more for the kits. >> so you're saying you have capacity? you have capacity and the secretary doesn't need to take action? it shouldn't be a mystery here. we should be clear whether we need more capacity by other supplier suppliers or not. >> we need -- we understand we have to speed up the replacement kits. even if we increase to 450,000 gallons, still speed up. so we are discussing with automakers, with any we can take

to speed up the replacement. i'm not sure what kind of things -- >> well, maybe i'll ask the other two. mr. schostek, do you think we need to have the secretary take action, yes or no? >> at the present time, we have enough supply for the demand, but the demand could change based on future actions. so i'm not in a position to judge takata's ultimate capacity here for us, all options should be on the table to get parts replaced in customer vehicles. >> okay. i have about a minute left and i want to get to another point, but i'm going to follow up on this with each of you and with the secretary. but why are we not here today discussing why not make manufacturers responsible for 100% recall success? the gaps that i see, i mean, first of all, i don't see an

e-mail system here. i don't see an amber alert. and yet we have people who are dying. and we're hiding behind, well, we had an agreement, and we did a settlement, and then in the settlement, nobody really knew what was going on. my understanding is, germany has more, like 100% recall success. we have a gap here with people who are second purchasers, not knowing, because you're communicating with first, is my understanding, first buyers. so, why not just say that you're responsible for getting 100% recall? it's your -- the cars are yours. they're out there in the public. there's lots of tools we can use, but why not set a better goal than what we have? >> well, 100% would be what we'd want to achieve too. and that's what we're trying to achieve right now. we are trying different methods. we haven't got 100%.

i think, especially in older vehicle populations, we are -- we've been unable to achieve 100%. i don't know the average recall completion rate. i believe, but i would want to check further, i believe it's about 60, 70, 80%. to me, that's not good enough. >> my understanding is that germany is getting like 100%. so -- >> right. and i would just submit, senator, in my full written opening statement, we talk about that. germany, to my understanding, has a process whereby if a car, before a car can get registered, it needs to be checked if there's any outstanding recalls. similar to, in some states in the united states, an admission certificate proceeds registration. please don't misunderstood. honda is going to take, use any new tools or innovative tools to find customers and get these recalls done. that's what we want to have happen.

but there could be some support on a state level or, you know, for recommendations such as that. >> i think the more the manufacturers can talk about not what nhtsa does and requires today, but what you would like to see, the better that will be. thank you, mr. chairman. >> senator rubio. >> thank you, mr. chairman. this question is to all three of the companies involved. can you guarantee us here today that no one driving one of these vehicles outside of the territories currently covered, florida, hawaii, puerto rico, the u.s., virgin islands, places with high humidity. if you are driving one of these vehicles with one of these devices in it outside of those territories, can you guarantee us that no one will be injured by this device in the way we've seen in other places? >> maybe i'll start. as i mentioned in the opening statement, it's -- the -- currently issues from the past

instant or programs is already addressed and taken care of. and according to my understanding, i believe that it's products we are purchasing right now. including the kits, and produce and well controlled processes, and work as designed, and are safe. and regarding the recall you mentioned over the four states for the high humidity area, according to our record, this area due to the high absolute humidity environment -- >> i understand. i'm sorry. i don't mean to cut you off. i have limited time. my question is pretty straightforward, though. if you bought a car and have one of the cars with this device in it and you have spent the entire time in north dakota or south dakota, or wisconsin, not one of these places, can you tell us here today that you are confident that no one will be injured in the way we saw, for

example, in florida. >> if it's not currently under recall, covered by recall, i believe our products in the car works as designed and safe, as i said before. >> okay. so we're never going to read about a story of someone outside of these areas covered by the recall that have been injured in the same way that we saw, for example, in florida. is that your testimony? >> according to my knowledge, again, it's -- i believe it's safe. >> what about the other companies? >> senator rubio, we have recalls outstanding that are connected to manufacturing issues. we did these recalls 2008 through 2011. they had no geographic limit. those are uncompleted recalls, and i was just discussing with senator cantwell, our struggles to get those to get those completed.

those customers, we want them to come in. there's risk there. we want those customers to come in. we want to get to 100%. >> my question is people not covered by the recall for various reasons, where they purchased the car. you're talking about the recalls that had nothing to do with geographic limits. >> yes, sir. >> i'm talking about the ones that do. the ones that maybe that's not specific to your company. if your car is not currently covered under the existing recall, you have nothing to worry about? >> we've identified higher risks in the humid areas, and that's what we're still working on right now to gather more information about those vehicles both there and in nonhumid states. >> yes. >> senator, i would characterize in my opening statement, i characterize this situation as an ongoing investigation. and at least once during the testimony i reiterated that in the absence of defined root cause for the beta population of vehicles, i think we would find

it difficult to guarantee 100% as to the risk outside of the geographic regions identified. i believe that test data and the incidents confirmed those areas are of high risk and utmost importance to deal with those first. but with the open status of the root cause, i could not affirm your question. >> to the best of your knowledge with the minute i have left. to the best of your knowledge, did any of your companies at any time calculate that the costs of conducting a recall outweighed the benefits of alerting consumers and therefore decided not to move forward with some of this earlier in the process. in essence, was there a time where a calculation was made that it would cost so much financially to deal with this, that we're better off not doing anything about it because the safety risks don't justify it. did that calculation happen at any of the three companies? >> i can confidently say that's not the case at chrysler. >> to the best of my knowledge, no, sir. >> is not the case. >> okay my last question. if i am driving one of these cars now, and i don't live in

one of the states covered or areas or products covered by the recall because of where they're geographically located? what should i do? just go on about my life and not worry about it? >> we communicated to our dealers, if our customer has a concern, as a worry about driving a vehicle, in one of -- >> my question is should they have a worry? if you're not covered currently by the recall but you're driving one of these cars, should you have a worry? >> again, we've, we don't we see the risk much higher in the humid states. and it's open as to what is the cause. that's what all of us are trying to get to right now with regard to these regional, this regional s.i.c. >> senator rubio, i would say for the chrysler vehicles not covered by the recall, i would drive them myself. >> senator rubio, they see the risk much higher in the humid states.

but associated press reported on november 17th that honda had quietly decided to replace impacted tack at takata air bags nationwide, rather than just in hot and humid states. and so they also indicated in those reports that honda had no intention of actually notifying customers in other states about the remedy. instead, as stated, they would have to go to their dealer. so mr. schostek, why did honda believe it was appropriate to provide a remedy but not tell anybody? >> chairman nelson, this is not a secret or quiet policy. it's on the nhtsa website. and it's there because we put it there. this was a communication to our dealers. our dealers are asking the same kind of questions that senator rubio had.

and when we want to deal with our customers' needs in the nonhumid areas, on an individual basis. if we find a customer that has a concern, we are asking our dealers to take care of that customer and replace that air bag. understanding that we believe the repairs are more priority in the humid areas. but we have an approach to our customers that we want to provide customer service. it's not secret, we didn't mean it to be quiet. we wanted to tell our dealers, if our customer comes in with a concern, please respond to that concern. >> so a dealer in senator thune's state of south dakota, or senator markey's state or senator klobuchar's state, but we're a mobile society. and there are people in massachusetts and minnesota and

south dakota that drive south and to come florida during all times of the year. especially january. but when the kids are out of school, they come also in the heat of the summer. to disney world. now, isn't something missing here? >> we are trying to understand the reasons for the inflater ruptures. and we are looking for -- we're collecting inflaters from vehicles that have been in those humid states, or ever been registered in those humid states or spent time in those -- you know, we're doing our best to collect that information, sir. >> mr. s shimizu, this morning' "new york times" says, quote, two former tack atta engineers said they and other employees had concerns over switching to a

risky compound. they're talking about the ammonium nitrate from the previous compound. quote, it's a basic design flaw that predisposes this propellant to break apart and therefore risk catastrophic failure in an inflater, said mark lily, a former senior engineer with takata, at its propellant plant in moses lake, washington. mr. lily recently shared his concerns with our senate staff members. quote, it was a question that came up. ammonium nitrate propellant, won't that blow up? said michael britton, a chemical engineer 40 worked with mr. lily at the moses lake plant. the answer was, not if it stays in the right phase.

all right. now, in addition, the media reported various problems at the takata plant in 2001. and secret air bag tests in 2004. so why didn't takata take action on any of these kind of concerns regarding the use of ammonium nitrate. >> nor, let me briefly explain about that materials called ammonium nitrate. ammonium nitrate is, as i said at the beginning, there are several advantage to using. and it's a benefit to the users, also, end users also. but it's -- because its chemical

properties, it's -- there are sensitive to moisture is well known. and if moisture is not well-controlled during the monitoring propellant or assembling inflater, the performance -- they performed -- they don't perform as designed, and because that may influence the combustion characteristics. and that's well known in the industry. but talking about phase of this thing, according to my knowledge, the ammonium nitrate stays stable, and then it's during the process, the manufacturing processes, and also the physical environment.

so in my understanding, if -- in other words, if we produce the propellant and inflater under control, especially moisture control environment, that will be stable and safe, and of course there are some, you know happens during process, some occasion we have some failure will appear as we did in the past. >> mr. shimizu, i did not interrupt you. i wanted to give you every opportunity to answer the question. that doesn't answer the question. if, in fact, you knew about it as far back as 2001 and they takata was doing secret air bag tests with ammonium nitrate in 2004, and you had your own engineers, as quoted in today's "new york times," saying what

they said, that ammonium nitrate was the problem, then -- senators, any further questions in a second round? >> may i ask one question? >> please. >> mr. schostek, until two days ago, most of the recent actions taken related to defective driver side air bags were limited to so-called humid states. but three of the four deaths that were caused by exploding takata air bags on the cars occurred in oklahoma, virginia, and california. not the humid states that this recall applied to. as the chairman was just referring to. south dakota, minnesota, massachusetts, could have been in that category. when my staff asked nhtsa about these deaths, they were told that the vehicles involved had been recalled for a different

takata air bag manufacturing problem years ago. but that they had not been repaired. there is just one problem with the explanation. when my staff put the vehicle i.d. number of two cars involved in 2013 and 2014 fatalities through honda's recall data base, the database says these cars' air bags were repaired some time after 2011. either, one, your recall database is wrong. or, two, the defective air bag was replaced with another defective air bag. or three, the driver received a brand new air bag some time after 2011 and the air bag still killed someone just a few years later. so mr. schostek, which of those three options is it? >> senator markey, i believe it's option one. that our website is -- has deficiencies. when we have multiple recalls that involve the same vehicle,

our system was bringing up a message of recall completed for the ones that were superceded, if you will. it's our problem, sir, which is being fixed. we are due to report to nhtsa tomorrow about that. it is an embarrassing problem in this day and age that we have that technology problem on our website. >> all right. so this goes back to the senator heller's question and others about the safety of families driving these vehicles. so what you're telling me is that someone buying a used honda today could look upped car they want to buy on your recall database, be told that a repair needed to fix a fatal safety defect was completed, even though it was not. and i think, again, that just goes to the whole question of whether or not the public should feel confident that they have a family member driving these vehicles.

>> sir, i agree with you. that could happen today. i'm bound and determined to check and make sure it can't happen tomorrow and it won't happen again. >> and i'll just say, again, mr. chairman, i don't think it makes any sense for a passenger air bag side recall not to occur. otherwise the passengers in these vehicles should just be in the back seat. because they're just really running a huge risk. given the fact the very same air bags that deployed and ready to hit dangerously a passenger. in our country. thank you, mr. chairman. >> and, gentlemen, you need to know that i'm going to be meeting with secretary fox. i'm going to request of him that he impose the maximum penalty allowed by law. even if that's $1 million a day. on the automobile companies, if

you all are not providing a loaner, or a rental car, to the folks who potentially would be driving a death trap. it's as simple as that. senators, we need to move on to the next nhtsa person senator blumenthal? >> just one quick question to mr. shimizu. what is the maximum number of replacement parts that you will be able to provide per month? >> currently, it's all provided from mexico for american market. 300,000 per month at this moment. but it will be increased to 450,000 a month from january. >> 450,000 per month. that is the maximum. >> that's our plan right now. >> and one more question.

what steps have you taken to improve the assembly of the inflater, the container that senator nelson showed you? what steps have you taken to make the inflater more leak proof and waterproof? in other words, more resistant to water coming into it or humidity. >> a couple step -- couple step already we have taken to improve the problems, improve the robustness. and we are discussing with our car makers the current product as i said, it's safe from -- if they came out from processes. but there are ways to improve the robustness against the humidity.

we'll continue to discuss about how we can improve the robustness of the inflater from now. >> thank you, mr. chairman. >> thank you, senator. >> okay, gentlemen, thank you for your participation today. we'll call up mr. david friedman, the deputy administrator of the national highway traffic safety administration, nhtsa.

>> where is mr. friedman? welcome, mr. friedman. have you heard the testimony in the ante room? >> yes, sir -- yes, mr. chairman, i have. >> okay. what we're going to do is forego the statement because of the lateness of the hour. we're going to have our senators and you can make your points in response to the questions. i'll defer my questions and do cleanup at the end. senator thune. >> thank you, mr. chairman.

mr. friedman, of course we've been here today 20 discuss yet another apparent failure within the automobile industry. and these issues with the faulty tack at to air bags are just the latest in a long line of high profile recalls that have been the focus of multiple hearings held by this committee and the house of representatives this year. it's just kind of a general question but i'm wondering if you could should some light on why we're seeing such a flood of automaticive safety issues recently and do you believe that this recent experience indicates a broad and systemic problem within the automobile industry? >> senator, one of the reasons why ranking member, one of the reasons why i think we're seeing the increase in recalls is because the auto industry is running scared. the auto industry realizes, one, that nhtsa has been pushing them hard to establish a new normal. when it comes to recalls. where we expect them to recall vehicles quickly, to notify us quickly, and to find the

problems quickly. i think they're also very concerned about and as they should be about the actions that congress has taken to shed a light on serious problems in the auto industry. and i think they're also reacting to the media attention that has been observed. they're cleaning out their closet, and it's truly a shame the fact it took all of this attention for them to do so. i asked 12 major auto makers. i called them to way washington to talk to them about the need for a new normal when it comes to recalls. no more hiding information. no more hiding behind attorney/client privilege. no more waiting to prove beyond a shadow of a doubt there's a problem. no more fighting us when we have clear evidence of defects. they need to act much more quickly. and nhtsa needs to continue to act more aggressively and more quickly to keep them in line as we've done over the last six years with more than $160 million in fines.

>> in 2010 nhtsa closed its examination into the scope and timeliness of honda recalls involving takata driver's side air bags citing, and i quote, insufficient information to suggest that honda failed to make timely defect decisions on information it was provided. end quote. what was the insufficient information at issue and knowing what you know now should the agency have kept that inquiry open? >> senator, we're just beginning to look into the details of what happened at that time. i expect to be able to provide you more details on that going forward. my understanding, my current understanding is that we understood that takata had identified the batches that were involved with the manufacturing problems. but it's been made clear to us that takata does not have good quality control and clearly does not have good recordkeeping, because further down the road, they had to update their submissions in some of their

recalls, indicating that they had not provided us with that information. that is one of the key reasons we are demanding under oath they provide us answers about all of these recalls, all of the tests they've done on air bags. we need every bit of that information. we will pore through that. and if they failed to live up to the law. if the auto industry failed to live up to the law, we will hold them accountable to the full extent of the law. i would say, though, one of the things we would like to see, as is in included in grow america act is a significant increase in our ability to hold them accountable. right now we're limited to just $35 million for any single infraction. frankly, for too many of these companies, that's pocket change. the secretary and president have asked for that to be increased to $300 million, and if you give us that authority, we'll use it aggressively. >> what you're saying though is the insufficient informations their failure to disclose to you

the information that could have shed additional light on this. and that you closed the inquiry because you thought you had satisfied all the questions that you had. >> based on our understanding- >> but that was a failure on their part to provide information. >> we're looking in to it to find that out. and that's why we're demanding that provide us that information under oath. >> you haven't had a chance to look at it yet. but senator nelson and i and a few others on the committee are introducing legislation today that would incentivize individuals who uncover serious allegations of vehicle defects or noncompliance with motor safety laws to blow the whistle and provide original information to government regulators. and that if that information leads to enforcement actions where more than $1 million in monetary sanctions is involved, that that whistle-blower could receive up to 30% of that. is that a concept that you could support?

>> senator, we welcome every bit of evidence, every bit of information that can help lead us to root out any of these problems. i look forward to reading your legislation, i look forward to evaluating. one of the things i think would be crucial in general, but also with such a proposal is to ensure we have the resources, the people and the dollars to follow up on those leads. we're getting this year alone over 70,000 consumer complaints. these are critical to us finding -- finding these problems. we get 6,000 reports a year from the auto industry. we need more people to be able to follow up on all that information. >> thank you, mr. chairman. time's expired. thanks. >> i agree with you, mr. friedman. you do need more resources. and thanks to senator thune for being willing to push forward on this question on the whistle-blowers. senator klobuchar. >> thank you very much, senator

nelson. first of all, i think you maybe heard me talk about the victim in our state who is permanently blinded from the north oaks, minnesota, she was driving her bmw in 2013, it was a 2002 model. and this is sad because this had been going on for so long. there's a "new york times" report about secret tests by takata in 2004, and now here you are in 2013. mr. friedman, according to the family, they never received confirmation that from this so their case was being reviewed. i don't know what actions, follow-up actions, the family itself filed something with nhtsa in 2013. do you know if anyone ever reviewed the complaint that was filed by the family and what happened? >> senator, we're looking into this as we speak. i know your staff is alerted to us just this week. but we put eyes on every single

complaint that comes through nhtsa. that comes through our website. that comes through our hotline. that people mail in. we put eyes on all of them and we follow up and we try to piece together the information that that provides. i'll look further into this to make sure that i can tell you exactly what happened with this. >> okay. obviously this complaint was filed after it happened. given how these recalls have trickled out, it might have helped someone else. and that's why we're concerned. then going back in time, nhtsa's call this week, now we're into this week, for a recall that expanded beyond the regional recall finally got at people in minnesota who might be actually snow birds, believe it or not, some of them abandon our state during the winter. so they actually spend their winter months in southern states, and their vehicles, then, they drive down there, and then they drive back. so their vehicles are exposed for an extended amount of time to high humidity.

and they were not included in the previous regional recalls. and you didn't think there was a need to include those type of vehicles. what changed? >> senator, if we could put up a couple of charts so that i can help make that clear. this is a chart of the united states indicating the median dew point temperature, which is basically an indication of the total amount of water in the air. all the initial incidents that occurred, occurred in these regions that you see in brown, or in puerto rico, which is also even more humid. so all the initial incidents that caused us to open this investigation, we started with three complaints. we acted rapidly based on those three complaints. we connected the dots. that all three, there were three different car companies. all three had air bags from takata. we connected those dots. we connected the dots, as well, that these were all in humid regions.

we opened an investigation and got the auto industry to begin recalling vehicles in days. so we acted aggressively in this case based on the information we had at the time. now, we -- because we didn't want to see anyone else hurt from these problems, part of what we did is we pushed the auto industry. we said we can't wait for another one of these incidents. you need to get out there and work with takata, test air bags that are returned so that we can figure out, is this a broader problem? we can't sit here. now, if -- as we did that, as we tried to gather that test data, we were also monitoring field incidents. if you could put up the driver's side. initially what we were working with on the driver's side air bags was three incidents -- sorry, two -- five incidents,

pardon me, that were all in florida. again, initially, reinforcing the concept that this was a problem related to exposure to high temperatures and high humidity. in other words, high, median dew point temperature. >> were they all in florida or the southern part of the united states? >> initially, it was only these -- >> and then it got to some southern -- okay. >> then, there was an incident in california. >> right. >> when that incident happened we made clear to honda and honda acted to extend their regional recall to that area. at that point, that could, could have been an outlyer. >> uh-huh. >> then, at the end of last month, we received a complaint from an incident in north carolina. >> uh-huh. >> we acted quickly. we reached out to the consumer. we verified that it was, in fact, an air bag rupture. based on that data, the pattern is now clearly broken for the driver side air bags. >> okay.

>> so while all the incidents initially were around here, now we have an incident here and here. >> right. >> areas of much lower temperature and humidity. >> okay. >> based on that information, we called on takata, and all the automakers involved with driver side air bags, to recall those vehicles. >> okay my last question is about not the humidity issue and expanding the rest of the united states, but the types of cars. so this is an issue for the family, this was a bmw car. it's my understanding in 2010, bmw told nhtsa that it was aware of the takata air bags under honda's recalls but that takata had told them that bmw vehicles were not affected. so did you -- nhtsa receive that? and did this happen with other manufacturers, as well, that they just based this on takata's information? >> i believe that's accurate. one of the things, frankly, that needs to change and needs to be more effective is suppliers and automakers need to do a better job of sharing incidents,

especially when you have a common supplier. right now, all too often, automakers keep their incident data to themselves. >> can they legally share that information? >> well, this is one of the things when i called all 12 automakers to washington that i began discussing with them. we've got to figure out a way, without violating antitrust laws, that they can share critical safety information. there should be no barriers to sharing that. >> agreed. and how about suppliers? >> we also talked about is up blighers. i was talking to them about takata at the time because both in the gm case and in the takata case, part of the concerns here are communications between the auto industry and their suppliers. that has to get better. >> got it. all right. maybe there's something we can work on. thank you, mr. frieden. >> senator markey. by the way, of course your written testimony will be a permanent part of the record. >> thank you, mr. chairman. >> senator markey. >> thank you very much.

mr. friedman how can you justify calling for a mandatory nationwide recall of takata driver side air bags, while continuing to allow a patchwork of voluntary and regional recalls for takata's passenger side air bags? >> senator, two things, first of all, these regional recalls are not voluntary, period. i have in my hand the same letters that each of the car companies are sending to all the affected consumers. that state important safety recall notice. this is from honda. who frankly i was frustrated to hear them even at times calling this a service campaign. this is a recall. they also very clearly state honda has decided. >> why are you not making the same recall of passenger side air bags? >> senator, that's based on the data. if we could switch to the chart

based on -- the test chart. because we didn't want to be in a position of waiting for another rupture. we pushed the auto industry and takata to test air bags, not just in the affected regions, but all over the country. >> can i just ask you to do this? kim coughlin is sitting over here. her sister died in a passenger side air bag accident. so what do you tell kim and her family about her sister? and everyone else's sister who is now sitting in that same passenger seat now in vehicles all across the country, given the fact that kim has lost her sister. why are the passenger side air bags not being recalled? her sister was driving a subaru with a takata air bag in a nonhumid state. why not issue that same recall

order as a result? for every passenger side air bag, as well? >> senator, what i say to you, this is the first i've heard of your accident. i please, get us the details of what happened. i want to know what happened to your sister. it's an utter tragedy, clearly, what happened to your sister. if we can get information from you on exactly what happened so that we can determine if this was an air bag rupture outside of those regions, you could help other americans potentially protect themselves if there's data out there. we will always follow the data. we will always follow the information. that's why we pushed the automakers to test this. the challenge we face, senator is if without information, the safety act requires us, requires us to act on information based on unreasonable risk. if i have no information about an unreasonable risk outside of those areas, then i'm not able to force the automakers to

recall outside those areas. in a situation, look -- >> no -- >> >> the limited air bag supply. what you're potentially doing, senator, if i did another recall without the data is putting someone's life at risk. >> her sister was in arizona, okay. goes up to 110, 120 degrees in arizona. that car can be driven over to southern california, driven over to texas. could be driven to florida. you don't know what any of these family members are going to be doing. it could be a used car. it could be taken to another state. i just seems to me that you as the agency chief should err on the side of safety knowing these vehicles move from state to state. as the senator said, the chairman said, people are going to florida from pretty much every state in order to escape

the cold in the winter, in order to visit disney world, and we know that. and once they hit those conditions, an accident could happen. and so why don't we just recognize the mobile nature of our society, the danger that each person runs, and by the way, i don't accept the fact there is no risk in really warm weather in arizona or other states. because we have other states here that are outside the humid area that have had these incidents. i just don't know why you don't say to all these families who have already lost people that the least that's going to happen is no other family member of any other family in america is going to suffer the same fate. >> senator, that is my solemn goal in doing all of our efforts. is to put safety first. if we have evidence that indicates this should be a national recall, we'll do that. right now the challenge, senator is, what you're asking me to do based without information is to put someone's life at risk in

florida based on a lack of information elsewhere in a situation where air bag supplies are limited. we are pushing takata incredibly hard to get more air bags. >> you've heard takata today. takata is not even saying they support your recall right now. >> it's frustrating. unacceptable. >> how can you trust a company, mr. friedman, in answer to my question today about whether or not they support your nationwide recall for driver's said, says they cannot give an affirmative answer to that. that is a frightening answer from a company who is responsible for ensuring that all information about the danger of these air bags is made public. you should just err on the side of safety. finally, if i can, toyota believes that its passenger side air bags driven in some humid states are so dangerous that it told dealers to disability them and warn passengers not to sit in the passenger seats. do you think toyota was right to warn its dealers, and vehicle

owners, in that manner? >> senator, first to address one of the previous issues of people in and out of states. first of all let me be clear. the data indicates that the median time to failure for these air bags is ten years. if you're coming in and out of these states or in them for only a short period of time, the data does not indicate you're facing the same risk as someone who lives there. further, if you look -- >> toyota -- answer the toyota question before my time runs out. >> senator, you can drive a vehicle without someone in the passenger seat. but even if you drive a vehicle without someone in the passenger seat, if that air bag ruptures, that driver is in danger. therefore disabling an air bag and putting a label on that vehicle saying do not put anyone in this passenger seat is a way to protect the driver from a dangerous air bag. >> so you approved toyota's plan to do that? >> senator, it's not a question of approval. these are defective parts and

therefore they are broken parts. >> okay, well if you did approve that plan, then why didn't you tell other manufacturers with passenger side takata air bags to issue the same warning? >> senator, as i said, we did not approve this one way or another. these are broken parts. and manufacturers are allowed to disconnect broken parts. >> here's the letter that came from nhtsa to toyota. this letter serves to acknowledge toyota motor engineering notification to the national highway traffic safety administration of a safety recall which will be conducted pursuant to federal law for the products listed below. and the product that we are referring to is the air bag that is in discussion. and it says in your letter that as an interim measure the dealer will disable the front passenger air bag and advise the customer not to use the front passenger

seat until a replacement inflater is installed. that's y'all letter to toyota. >> that's accurate, senator. that's our letter acknowledging -- >> again, if that's the case, why not have a similar letter from every other manufacturer. to warn people of a potential passenger side air bag catastrophe. >> senator, i believe there may be some confusion in the process here. we do not approve remedies. what that letter is is called a recall acknowledgment letter. that is us acknowledging to them what they told us. that is our way of holding them to the decisions that they have made. it is not our letter telling them what to do. it is simply us acknowledging their steps. >> you know, it just kind of says to me that you're seeing yourself as some detached processor of a decision made by a manufacturer of vehicles,

toyota, that has tremendous implications for every other vehicle that has the same kind of takata air bag, catastrophic consequence that is possible. and i don't understand how you can process something like this. agree with this, essentially, hold the manufacturer to the implementation of it and not simultaneously be saying this is the warning bell going off if toyota believes this is so dangerous that the other manufacturers, as well, should have the same responsibility to make sure those air bags are recalled. so i just say to you, mr. friedman, that from my perspective, there's a higher responsibility that as an agency we have to call you to. and i thank you, mr. chairman. >> and you will acknowledge because you heard the testimony today that each of these automobile manufacturers are handling the recalls in a different way, which is all the

more, adding confusion. you heard chrysler say they're not going to start until the middle of december. and you've got to have concerns about whether these automakers are responding appropriately. >> i have serious concerns. we have actually had to push chrysler before in previous cases to accelerate the production of parts to get notices out to consumers. i don't accept after hearing what they said. i don't accept that there's any reason why they should wait to notify consumers about these recalls until they have the parts. consumers need to know there is a risk in chrysler vehicles because of these air bags. consumers need to be aware of that risk. >> do you have under law the ability to fine them if they don't respond quickly? to replace these defective air bags? >> we have authority under law to require an accelerated remedy.

and if we determine that they have tools that they could be putting into place to provide a remedy more quickly than they currently are, yes, we can require them to act. we are currently in the process of trying to ask and determine that exact question. we've already pushed takata to increase their production from about 300,000 units a month to about 500,000 units a month. >> do you have the legal authority to fine them on a daily basis if, in fact, they are not replacing the air bags? >> if we find that they could be doing more, and they're failing to do so, absolutely. we can order them to accelerate the remedy, and if they don't do it, we can fine them. >> well if somebody's driving around in a lethal death trap, isn't that enough evidence, without getting their air bag replaced, that you ought to start sticking it to the manufacturers with a severe financial penalty?

>> senator, my understanding of the safety act is that it requires us, before we can do that, that it requires us to be able to demonstrate that they could be doing more than they could. we started from the beginning digging in, trying to understand, we're contacting other suppliers and trying to get them to be able to step up to supply more air bags. >> i don't want to beat up on you, but if you could meet corey murdoch from central florida, the father of two little boys, a firefighter who now has no ability because he does not have an eye as a result of a piece of this shrapnel coming in his eye, then it would seem to me that would give you the legal authority to whack it to these people to replace those defective air bags. senator blumenthal. >> senator, thank you.

mr. friedman, thanks for being here today. i -- i take your comments about going after the automobile manufacturers. and pushing them. i want to ask you about your responsibility. you've heard the head of takata say today the maximum they can commit to produce are 300,000 replacement parts a month. their hope, their hope is to go to 450,000. they are unwilling to commit to anything more than 300,000 replacement parts a month. which means, it will take three years, and even if they meet the 450,000 goal, the hope, it will take more than two years. isn't that unacceptable? >> absolutely unacceptable.

>> and so, will you commit to use the power that you have under the motor vehicle safety act section 301.20-c-3, as you know, to order that the car manufacturers use replacement parts from other makers of air bags. >> senator, we will use all of our authority to the full extent >> i don't want a vague answer. >> senator. >> i want really a yes or no answer. because this is a pretty clear question. i know you'll use all your authority to do the right thing in the public interest. i want to know that you'll recommend to the secretary of transportation, that will you order the automobile manufacturers to use replacement parts, even if it means takata sharing proprietary information with them, so that americans are kept safe on the roads for the next two to three years.

>> senator, if i can determine that that can be done safely, absolutely i will. absolutely. >> how long will it take to make that determination. >> we are in contact with two different air bag suppliers. we are asking them what their capacity is, what their compatibility is. there may need to be tests involved to ensure. because each air bag is tuned for each car that they will be safe. we're hiring an expert in propellants and air bags. we're seeing the contracts with an expert in propellants and air bags. we need to get all of these people involved in making sure. >> well, i understand your testimony has said you've been in communication with other air bag inflater manufacturers to assess what, if any, capability those companies have to fill replacement parts. you have the power to order them to break exclusivity agreements, to share proprietary information. i want to know by when you will finish that determination.

>> senator, i will finish that as soon as we can determine if that is safe. i have to put the safety of those getting these replacement air bags first. i will do so, and we will do so as quickly as humanly possible with the resources congress has provided us. >> mr. friedman, would you agree with me that there's more than sufficient reason to believe that nhtsa was not furnished with enough information by the auto manufacturers about these defective products? >> senator, excuse me. i can't prejudge a case. but we have, because of the exact same concerns you have, we have demanded under oath information that will reveal exactly that. these are gut wrenching -- >> well, i know you have asked for this information under oath,

but, you know, when i was a prosecutor, we have something called probable cause, which is enough to indict. i recognize you don't have criminal authority. you would agree with me that there is pretty close to probable cause here to believe you weren't given the information you need to protect the public. >> senator, i'm not a lawyer, so i don't know the exact meaning of probable cause. but i will say is we are -- i don't trust that takata has provided us with -- we know that takata has not always provided the auto industry with accurate information of all the lots involved. we know that we haven't always gotten the information that we need. . we're looking into this. i have serious concerns and will hold them accountable based on the findings of our -- >> so far as the information that's concerned, the maximum penalty now is in the range of $30 million. as you know, senator markey and i and senator nelson our chairman have proposed the

automaker accountability act which would lift that $35 million cap on penalty. would eliminate the cap. would you support that legislation? >> senator, we will take all the authority you give us and use it to the full -- >> you support the legislation. >> senator, i -- we want that raised. >> that's a yes? >> the sent has already asked for it to be raised to $300,000. we personally, david friedman, if you give me the authority to do more, i will gladly accept that. >> well, don't you agree as the current acting administrator that $35 million, $300 million may be inadequate for some cases as this one where people have died as a result of failing to report sufficient information. >> there's no doubt that the more, the greatest fines we can levy on the automakers the greater power we have to keep them establishing the new normal that we need from them to always provide us with all the information they need and to

quickly act on that information, and to never fight us when we provide them with the data like we are in driver side air bag that these recalls need to happen nationwide. >> my time has expired. but i just want to finish by saying, by making the request that by the beginning of next week you come back to this committee in writing after consulting with secretary about how quickly you will have a determination as to other companies that can provide these replacement parts and whether you will recommend to the secretary, in other words, the time line for finishing that process. and i hope it will be measured in days, not weeks. i know that the secretary of transportation, i've talked to

him on a number of cases shares our concerns on this committee, very strongly shares concerns about the american public. and i commend him for not only sharing those concerns but also acting to appoint a nhtsa administrator, which we welcome. and i would like you to give us a date by which you will make a recommendation as to how replacement parts will be accelerated under 301.20-c-3 of the motor vehicle safety act so that americans with be provided with those replacement parts as quickly as possible. because otherwise we will be waiting two to three years, under the most optimistic estimate, two-plus years, under the more realistic estimate, three years for americans to be safe on roads -- on american roads with these air bags in their cars. because they simply can't be replaced if there aren't the parts to replace them. thank you.

>> mr. friedman. i agree with you that you don't have the resources that your little agency needs. and i really feel kind of sorry for your successor who has now been named by the president. because as he goes through the confirmation process, needless to say, there are going to be a lot of questions that are going to be asked of him with regard to the conduct of your agency on a going-forward basis. and just to put this into context, the amount of vehicles with takata air bags worldwide, senator blumenthal, is something like 100 million. in the u.s. the amount of takata air bags is something like 30 million. so this could be a problem of gargantuan proportions, that is

going to need the aggressiveness of the federal regulator to try to protect the public. and we appreciate the hot seat that you're on. i'm going to be visiting with your boss who is the secretary of transportation. i'm going to ask him, as i've said earlier, to start socking it to the folks that are dragging their feet not answering questions with the financial penalties. that he has under law. and then we'll try to change the law so as to eliminate that cap. i want to thank everybody for participating. the meeting -- andor the meeting -- and before i adjourn, let me say that the record will remain open for ten days and all witnesses are expected to answer any and all questions for the record from the members of this committee. >> i apologize.

i'm wondering if i can say one more thing. >> of course. >> this is an agency of people who wake up every day with nearly 100 reminders of how we need more resources and to work harder to protect the american public. because nearly every day, 100 people die on our roads because of drunk driving, distracted driving, vehicle defects. each hour we come to work with over 2,000 reminders of people who are injured, over 2,000 people every hour of our need for more resources and to continue to improve and act aggressively to save peoples' lives. that is what every nhtsa employee, what i do every single day, is dedicate ourselves to protecting the american public. we will work aggressively in this case. i welcome your support, i welcome the added resources that you're looking to provide us. we will act aggressively to

protect the american public. >> mr. friedman, we appreciate that. and we appreciate the dedication of the federal employees who often are not given that appreciation. and on behalf of the committee, i express that. we now have a new problem that we are addressing. which is in effect a live hand grenade in front of a driver and a passenger in the vehicles that have been enumerated. and it must be addressed and it must be addressed immediately. and with that, thank you, and

a couple of live programs to tell you about coming up today on c-span. getting under way in about 40 minutes, senator jeff sessions, a member of the judiciary committee, will be talking about last night's executive order announcement by the president on immigration. then a panel of policy specialists will review the decision. live coverage starting at 11:30 a.m. president obama will be speaking about immigration in nevada just before 4:00 today. he'll be returning to del sol high school in las vegas where he appeared last year to talk about immigration in detail. c-span will have live coverage

beginning at about 3:55 p.m. eastern time with your phone calls to follow. more on what the president's executive action means, and what republicans might do with a reporter who joined us on this morning's "washington journal." >> breaking down the different parts of the dole. and to help us do that is a reporter on the story, al an gomez, an expert on immigration issues. thanks for coming on. who's in with the president's deal, and if you can break down the numbers a little bit more from that 5 million number we're seeing reported this morning. >> basically, consider the idea we have 11 million undocumented immigrants living in the country right now. what the president did was decide to protect people based on their family ties. so what he's doing is it's a little bit -- it's about 3.5 million people who are a parent of u.s. citizen children,

meaning they got here, they're undocumented, they had a kid here in the country, and because of birthright citizenship that child is now a citizen. that's about 3.5 million undocumented immigrant who is fall into that category. add a couple more hundred thousand to that of parents who are undocumented immigrants who are parents of legal resident, green cardholders. he's also adding about 600,000 more young'un documented immigrants. he protected a lot of them under a previous plan he announced in 2012. so that adds to that total. who's left out are people who have been here for long periods of time. there's a lot of push by immigration advocacy groups to try to get some protections for people who have lived here for 10, 15, 20 years and just don't have any children. so those are the big losers here. a lot of people were pushing for them, but they did get ultimately left out of this. >> for those who are in under this plan that the president announced, what does it mean? this is not a path to

citizenship. correct? this is not creating new voters? >> exactly. this does not allow anybody to even start a process to become a citizen. it doesn't let them become legal residents, anything like that. what it does, it's a temporary -- basicallitis a protection that they're not going to be deported. it lets them live here, work here. they'll get work permits and social security security numbers so they can pay into the country's taxes while they're working here, but what it does is for thee years they're allowed to live here, work here legally, but nothing in terms of get ong that road to citizenship. >> talk about the issue of border security and what the president said about border security last night. >> yeah. obviously, you know, that's that big chunk of this country that is primarily concerned with securing that southwest border. and what he's done, it's interesting, he can't suddenly just approve 10,000 new border patrol agents or something like that, so what he did is he's going to refocus pretty much the

entirety of the u.s. immigration enforcement apparatus. we're talking border patrol, immigrations and customs enforcement officer who is patrol the interior of the country. u.s. prosecutors, u.s. attorney who is prosecute these case. immigration judges. what he's doing is he's going to have all of them refocus their efforts to the border to get people who are crossing recently to focus on that to sort of try and prevent future raids of illegal immigrations while also having them focus on undocumented immigrants who are career criminals, who have serious criminal backgrounds or threat to national security, things hike that. so he's pretty much having them automatic going to turn their focus to that southwest border. >> in terms of the deferred action program and the undocumented immigrants who are being protected under the president's announcement, he said in the past he didn't have the power to do this. so what changed now?

>> that is a question of quite interesting debate right now. what the white house is saying is that he was responding to people who were calling for him to halt all deportations. the president -- you know, their legal justification for doing this, part of it is that he's still enforcing immigration laws. they're still going to be deporting about 400,000 undocumented immigrants from the country each year so they'll be fulfilling that congressional mandate to enforce immigration laws. and so by doing that he says he has the authority to then have some discretion on who to deport and who to target. but, yeah, he sounded pretty clear a couple times, saying, look, i don't have the legal authority to go any further. they've been researching this for the past nine months. the white house counsel has been looking at this closely. jeh johnson has been looking that the as well. this was pretty much their determination. there might be a thing where he

might have spoken without having kind of looked through all of this in the past, and so that's definitely one of the things we're curious about. but, yeah, right now, they're saying he absolutely has the legal justification to do this. obviously, republicans on the hill disagree pretty vociferously. >> alan gomez, talk about republicans on the hill, what their options are now. >> well, they're going to be possessing a whole stream of options. a wing will be pushing for impeachment, but that's unlikely because you need two-third vote in the senate. the two options that are more realistic and we could see, be one is federal lawsuit. house speaker john boehner has mentioned that, floated that idea over the summer to go after the president for his executive actions using the federal courts to block what he's doing. so that's something that we could see play out in the next few months. more immediately what we'll see is republicans trying to use the budget process to defund what he's trying to do here.

a lot of them have been saying that, you know, the government is funded through december 11th, when they get back from the thanksgiving break they're going to be focused on trying to pass the budget so, a lot of republicans want to do that. you cannot do these processes with this budget. the difficulty there though is that the main agency that's going to be responsible for processing all these undocumented immigrants, u.s. citizenship and immigration services, it's a self-funded agency. they're paid by the people who are going to be applying for this very program so, that makes it difficult for them to figure out how to debunk it. >> we should note for our viewers about 9:15 this morning speaker john boehner is expected to offer remarks on the president's announcement from last night. that's happening on capitol hill and we'll take our viewers on "the washington journal" to that live when that does happen. alan gomez of "usa today," before we bet you go, can we talk about your history and our other story in "usa today" that the 2010 arizona law helped

ignite this debate? >> yeah. it's just been a fascinating ride these last few years kind of looking at the direction the country has. arizona was really sort of the best mark, the leader of states saying, look, the feds haven't done anything, we have to find our own solution. several other states followed in the years to come. a dozen or more than a dozen states tried to kind of copy arizona's law, which basically cracked down on undocumented immigrants in their state and pretty much empowered local police to act as immigration agents. that was an intense wave of people trying to figure out how to deal with this since congress wasn't doing anything. in the last couple years congress has responded by trying to pass a bill but we've obviously seen all those efforts fail in last last couple years so ultimately brought us i think to this point where the president was saying, look, washington need to do something. congress is clearly incapable of getting this done so, thus i have to take this sort of action. >> al an gomez, reporter for "usa today," always appreciate

your time on "the washington journal." >> thanks a lot. house democrats this week elected new leadership, the 114th congress which begins in january. minority leader nancy pelosi, steny hoyer and james clyburn all unanimously elected to their post. ben lou hahn will replace steve israel heading up the democratic congressional campaign committee. new york's carolyn mccarthy is retiring after nine terms in the house, and during a recent interview with c-span she talked about the leadership choices. >> there were leadership elections this week for the new congress, and questions asked of mrs. pelosi by the press in the briefing afterwards about the freshness of the leadership team, whether or not they're needed to be younger voices and group of leaders, many of whom are over 70.

i'm wondering what you're thinking about the institution you're leaving behind and the leadership team that has as an aspiration the majority again? are they equipped for it? >> well, i think they are equipped, but i also think we have a lot of talented younger members, and it's not just by the way mrs. pelosi. i think she's been a great leader. and she is really good at raising money. that's not one of my fortes. i was never good at that. but they have to start training younger people and bring younger people into the caucus to become hopefully the future leaders. one of the things that i certainly believe with all my heart and soul, you have to know when to leave. and nancy obviously does not feel that this is the time to leave. many of those thought she might stay for maybe this coming year. they're hopefully going to turn

the reins over to someone else. but when i look around, is anybody really ready to replace her? i mean, it's a hard job. and i give her a lot of credit for what she's been able to do. but i think it's time that the leaders, you know, start looking at who's going to fill my spot? you know, we're all replaceable. that there might be some bumps in the road but i do always believe that it's time for younger people to take our spots with fresh ideas and new ways of doing things. i see nothing wrong with that. that's progression. that's a normal progression. >> that entire interview with carolyn mccarthy and republican from wisconsin also retiring can be seen at 8:00 monday on c-span. earlier this month the privacy and civil liberties board held a day-long forum on technology. technology er