their written statement for the record if i might. >> without objection. >> i now want to go to this audit and my colleagues are patient with me because i'm a audit weirdo i used to be an auditor and i read this stuff and mr. scovel knows i'm somebody who consumers these things. this audit report is one of the worst i've ever seen in terms of a government agency. and the reason it is so bad, i agree, mr. scovel, this isn't about resources, this is about blatant incompetent mismanagement, mr. rosekind. let's go through one of many short comings. and this is one that just jumps out of me. when to open an investigation. now if nhtsa can't clear about when an investigation is to be opened, we might as well shut it down. the inspector general found there are three factors to be

considered about an investigation. rate of consumer complaints severity of potential safety issues and identification of root cause. now, here is the scary part. based on the interviews the inspector general did, there is disagreement within your agency over when an investigation can ooechb be -- even be opened. the general counsel said severity must be established for all cases along with frequenty and root caused. the odi inspection chief said all three should be met and the director does not think a root cause is necessary and prefers a focus on safety consequences and the odi two investigative chiefs believe a root cause is not necessary. so you have key personnel within your agency not even on the same page on when an investigation

should occur. i -- i assume that you are getting busy on this as a baby step before you get at all of the other problems that are in this audit. >> there are 44 distinct actions that we are taken. that is one of them. these people are in the same room determining what that criteria and threshold should be. >> and do you believe that everyone that works there knows what their authorities are? do you believe that there is a clear understanding about what the investigative authorities are at nhtsa? >> i think the people that have the specific authorities assigned to them are aware of those. but you've just highlighted where those lines have been blurred and clarifications are needed. >> on average, only four times a year over the past four years has odi requested underlying document for death and injury reports. four times a year.

that to me is stunning. and although you have the authority to inspect manufacturers records for compliance with early warning requirements, nhtsa officials told the aig they have never used this authority. never used the authority to inspect manufacturers reports for compliance with early warning requirements. listen, i think you are doing your best. i think you understand the severity of the situation before you. but i was shocked when i read this i.g. report, how bad it was. i knew it was bad when the acting director before you didn't even know you had subpoena power. we discovered that in a previous hearing. so we're watching mr. careful mr. rosekind the kind of work you do immediately. and i disagree with my colleague. time not about to give you more money until i see meaningful progress on reforming the

internal progressies in this organization. you can't throw money into this agency until you see it run like it is supposed to. thank you mr. scovel it is not fair to blame you i think you are trying to get the place shaped up and we have a long way to go and i think we should do a follow up every four to six months to see how they are doing on the. >> g. list because i think the driving public deserves so much better from the cop on the beat. thank you. >> thank you, center cloeb uchar. >> i think it is important to follow up and see something happen on the follow up like takata did after that. after we saw that takata were susceptible to recall after high humidity areas and they finally

expanded recall nationwide for certain types of drier and -- driver and passenger side airbags and one of those affected was sashy soaka and she was permanently blind and was a passenger in a car and not even going fast and in a car in a finder fender-bender and now nerm innocently -- permanently blind sand gnaw does nhtsa need to do to compel companies to act sooner. >> partly what we are looking at besides resources are authorities. and other resorts within d.o.t. are hazard. if a hazard is identified we could take the airbags off the streets much sooner than what happened in this situation. so there are a variety of authorities. >> and would that be established by law. >> yes. authorities, you, congress have to provide to the agency. >> and would the penalties that nhtsa levied again takata

responsible for getting takata to act. >> yes. and we were able to go to $14,000 a day which was the maximum but on the list of authorities that we're looking for in grow america, that is another one. and we're looking for $300 million. >> very good. last month nhtsa filed a notice of in tent to file a remedy program for takata airbag to consider whether and if so how nhtsa will organize and prioritize the programs and how is nhtsa ensuring that the vehicles most at risk are replaced first? >> that is why we've just sebts out information letters to all of the 11 manufacturers and the seven suppliers and collecting information to put a plan together to do just that. people have talked about an accelerated remedy and that is more than making it go faster and it is prioritizing to make

sure people identified for risk which has to do with age, geography, driver's side need to make sure they are replaced as soon as possible. >> and switching to the gm issue, which you also are aware of of, we have a case of the natasha riding with her friends in a 2005 chevy cobalt in a wisconsin country road and without warning the electrical power went out and the car barreled ahead at 71 miles per hour and natasha and another passenger were killed when it ran into a tree. the report found that wisconsin state trooper keith young conducted an investigation into the crash that clearly made that link. this is a state trooper in wisconsin, between the defective ignition switch and the failure of the airbag to deploy and cracked the code that evaded gm and nhtsa for years. and he wrote that the two front airbags did not deploy and the ignition switch was returned

from the run position to accessory prior to the ignition to the hit with the trees. and i would like to know what systems nhtsa has put in place to ensure if the office of defect investigation investigators are in possession of critical information like trooper young's report, i would like some assurance they are now acting. >> and i'm going to start by acnonling the opening statement talking about one of the tragedies that you put a face to the tragedies going on. it is critical for people to know these are real people being affected so thank you all for doing that and i would say specifically, we did talk about this in my confirmation hearing and we have systems in place such as a case management system that allows the crash investigative investigators and the screeners and pams to look

at this from multiple sources in all in one place and connect the dots to the people working on this all of the available information. >> and there were 260 complaints over an 11-year period that the good morning had turned off while they were driving and over the 11 years the dots weren't connected but how does that change work in effect. >> we're talking about panels and screeners that have access to that information. and previously the person responsible for that case didn't get an alert there were updated information and now we have new data and that individual that was responsible gets all of the information in one place. >> thank you. very good. i'll have more information for the record. thank you center thune and nelson. >> and next up is the ranking member, somebody like senator

nelson very update to date senator blumenthal. >> i want to thank my -- express my thanks for this issue and to my distinguish colleague from florida, thank you for your very eloquent and powerful statement. i want to pursue some of the lines that have been raises already, lines of questioning that reflect the real-life consequences as you've just said, mr. rose kind. just to show you first, one of the airbags that actually bears the marks of the in effect, exploding exploding shreds of metal that killed eight people and many others but the real fault is

not with the airbag, there is no blood on the airbag. some may say legitimate there is blood on the hands of takata people who covers up and concealed concealed, but the fault is really with this device, the inflater, because it contained a substance that caused this explosion, the aknowny um night rate -- aknowny um night rate, and the question today is whether these devices are any safer than they were when they killed eight people and evidence may well show these inflaters are as dangerous today as they were when takata

first learned they were potential killers some years ago, as early as 2004 and 2006 and were as dangerous today and should be completely revamped and revised in their basic design and structure which takata has not yet done. the number of deaths reported so far is eight. i feel that that number is a lot like the number 13 that was first acknowledged by gm as caused by its defective ignition switch. with you now know that number is at least 117 because of the findings of the compensation fund that gm established only after i and others on this committee called for them to do it. that number of eight may well grow. it may be only the tiny

fractional tip of the iceberg of death that was caused by these exploding airbags. and so i believe, as has been stated that this report is a searing, devastating indictment of an agency that was responsible for protecting the public. but let's not forget the responsibility of corporate executives who could have and should have fully disclosed and then protected their customers from these devastatingly deadly devices. i think that that record of cover-up and concealment is one of the low points in corporate conduct and it represents the

need to strengthen not only the agency that you had, mr. rosekind we need to strengthen that agency not strangle it and provide more resources and funds, not cut. but a cop is only as good as the legal tools that she has. a cop is only as good as the laws that are in force. and so i have proposed, along with my colleagues, senator markey senator nelson, a set of new laws that will strengthen your legal tools. we can use all of the rhetoric we want in this room, in press conferences in public forum but the rhetoric is no good without real action and institutional change and new laws that give you the tools you need. so for example, eliminating the

caps on penalties, not just raising them, but eliminating the caps on penalties for nondisclosure. the early warning reporting act that will give you the mandate to establish a data base that is useful to consumers so they can take action to present themselves. the automaker accountability act that i've proposed as well as criminal penalties imposed not just on the companies but on the corporate executive when they cover up or conceal defects. and as my colleague senator mccaskill has said rental car companies need to be held accountable. but also used car dealers. at least one of these deaths occurred as a result of a used car and very often the manufacturers and the dealers

can't find the present owner of a car because he or she has bought it as a used car. automobile manufacturers and new car dealers are required to repair safety recalls before selling recalled vehicles under current law but there is no requirement that used car dealers fix any outstanding safety defects before selling a used car and this gap in consumer protection puts people at risk. so i think there are a number of preventive acts that can be taken and not the least of them is that any settlements such as happened with the gm ignition defect be disclosed fully. secret settlements ought to be banned and that is why i proposed the sunshine in litigation act with senator graham and i hope to revive it

again this challenge. and i want to know, whether you will join me whethermr. rosekind, in seeking these basic fundamental reforms that will be important going forward. we can a lot and blame saz much as we wish for the failures of the past and there have been deadly failure, but repairing this system and reforming it going forward ought to be our concern and it is not just oversight, it is addressing these problems with new legislation, giving you new tools and your successors so there is real institutional change. >> and i just wanted to start by saying thank you because, yes what woof seen over the last months is nhtsa's willingness to use all authorities and tools available to us to get action. if we don't have the authorities or as an max numb authority in effect we can't do our job. so yes, we will provide support

and any assistance with those authorities. >> and you need more resources do you not? >> absolutely. >> in fact the faa, i think, has something like 30 times your budget and 6,000 employees as compared to your 90. is that not a glaring deficiency and does not reflect a lack of investment in your agency and in the safety of our roads and drivers? >> and your citing a chart in a work force assessment that makes that comparison. so with under 500 deaths and major aviation accidents they have over 60,000 agencies and in the rail agency they have under 10 and close to 700 professions and we have in 2013, more deaths on the roadways and we have

under 90 employees. >> if our airways were as dangerous as our cars and roads corporate officials would be indicted and there would be sweeping changes in the airline industry. the lack of dramatic crashes is perhaps what enables the drip by drip crash by crash tragedies that have been detailed here and this nation has to make the kind of investment in your agency that laudably it has made in the safety of our air space. thank you. >> i have soernlt markey followed by peters, followed by heller followed by danes. we have a vote going on. and if you want to proceed. i would like to wrap the first panel up as quickly as possible. i will go over and vote. and then we'll gavel it out and recess and pick it up as soon as we get through with the vote.

senator. >> thank you mr. chairman very much. dr. rosekind. the senator and i have the early warning safety improvement act that required automakers to automatically provide defective cars to nhtsa and requires nhtsa to make more of that information available to the public. so that it can protect itself. and we can't get back the 117 people whose lives were lost to the gm ignition switch defect. we can't get back the eight people whose lives were taken by exploding takata airbags. but dr. rosekind, you do have right now, the authority to implement many of the changes that the markey blumenthal early warning reporting bill requires. you can take permanent measures even without a new law, to put information about fatal defects

into the hands of the public in case nhtsa's analysts fail to spot the exploding airbag defects. can you look at the families that lost their patients children, spouses or siblings and you can tell them that you did everything that you could to make sure thur lives weren't lost in vain. dr. rosekind will you call for a nhtsa ruling to require automakers to provide the early warning documents that alert them to potentially fatal defects to nits a -- nhtsa and to have nhtsa make this information public. >> the agency and i will do everything we can with the transparency of the agency to make that information available. numerous examples if the information were available and if that information would have been available that could have saves lives. and the privacy and

confidentiality wouldn't have impeded that. >> and would you make sure there is a formalized prove he is to make sure the information goes to the agency and the agency discloses it to the public so they can protect themselves. >> and i will commit to look at what shape that could look like knowing what our current legal obligations are versus confidentiality. the manufacturers have that data. they don't have the restrictions we do regarding the confidentiality and -- >> will you do a rule making, doctor consistent with the privacy act and confident proprietary information to ensure through the rule making that any information which you can make public will be made public and that the soo industry will be forced to give you that information, will you conduct a rule making to achieve that goal >> i will determine whatever we

can do for transparency, i will determine whether a rule making is even needed. >> you will do everything then, that is allowed by law to ensure that the auto industry will provide you with the information about defects and that nhtsa will then release that information you will do everything that is allowed by existing law. >> that is what we will look into and provide that transparency, yes. >> and you are saying you do not need a rule making to accomplish that rule. >> and that is what i have to look into. >> will you do a rule making if one is required after you determine the scope of your authority under the existing ruling will you do a rule making if it is necessary. >> if the evaluation shows that a rule making is needed for transparency, yes. >> well that is very important. i think that will really give the information to the public

which they need. if people can go online to buy a car, they should be able to go online to determine if the car has a defect which could harm a family member. so the sooner you put it online, the sooner you put that information up and the sooner you gut that information out there the more accountable the industry will be. they'll know the consumer will be king and the consumers will be protecting their family and ensure any successor nhtsa is accountable and making sure the information is made public. senator plumen shall and i have another bill and that bill is -- is one that says that a used car now purchased by someone may have a recall that actually ensures that there is a free replacement part but the person who purchased the used car really doesn't know about it. so our bill would require that

when the new owner registers the car that they are made aware of the safety defects and that those repairs are made. would you support that kind of legislation, dr. rosekind. >> dmv is a very important touch point to get those people informed. grow america talks about this because at this point there is no sense of the technology to do that, the cost, the procedures, et cetera and making sure that the consumers basically don't have any tegive effects created by a manufacturer, so absolutely, dmv is a touch point. in grow america we're suggesting say pilot program to figure out the cost program to figure out how that could grow nationally. >> thank you. i'm doing the heavy lifting with the gavel. so senator peters. >> thank you. and i appreciate the panel here

today and your testimony. administrator rosekind i hear you when you say that nhtsa needs help and to deliver effective over sight for vehicle safety we in congress need to consider increasing your funding as well as having stable funding for data systems and hire technology experts and enhance the office of investigation but before that happens i'm sure you know very well you must prove your agency can actually do this effectively and have in place the procedures that can ensure the work is done in a timely manner and you know as well as anybody time is of the essence. the more time that elapses ochk times -- oftentimes means more deaths as a result of problems and i see in michigan the progress that the auto industry is making for new technology and focusing on collision avoidance

and new mitigation and that will make traveling on our nation's roads much safer and smarter and more energy efficient and less congested and congress needs to promote the policy to up us usher in this new age of safer mobility and make sure that nhtsa can address the major issues it is facing today and in particular with airbags but also encourage the development of the new technologies that have the potential to save thousands of lives in the future but it is difficult to secure the funding and move the technology forward if folks like myself and fellow members of congress are not confident that the resources will be deployed in an effective manner and as the i.g. report made clear there is a considerable amount of work to do. administrator rosekind this recall is of unprecedented scale

for the recall and you've introduced initiatives to do this. and you've told us about the 17 recommendations of thethe i.g. and your report and how you can implement the recommendations before the end of the year. sir, can you say that nhtsa can adequately coordinate the recall you are in the middle of right now and implement the reforms without more funding from congress? >> we already have that plan in place. we have to effect this recall with current resources. that is the plan. >> and that is an opportunity for us to see the effectiveness of your agency to use these resources to be able to do this in an expedited way? >> correct. to mr. scovel, you've identified certainly an alarmed lack of transparency a deficient work force in volume and technical

expertise and you've delivered 17 recommendations and nhtsa has concurred. you've provided detailed actions and steps to make changes but based on now intimate knowledge of this agency as a result of your work, do you believe that this agency is capable of making these changes and how long do you think it will take? >> thank you senator peters. i would hold the administrator to his word. when he responded to our audit report, he indicated not only concurrence but a very aggressive intent to make good on all of those and in a relatively short time frame in our experience dealing with similar reports in other modes of the department of transportation. clearly the burden is on the agency at this point to make good on its promises to reform its processes, so that it may then come to congress and back to the american people and say, we're prepared to handle what we have and by the way, we may be

able to do even a better job should as a policy matter, we be afforded more resources. but right now sir the burden is on the administrator. >> and you have set a very aggressive time line of one year. again, based on your ibt matt knowledge -- intimate knowledge and you have the different agencies is that a good time line. >> it is. and that is the administrator's own time line, which we endorse and are hopeful and we will bird dog these implementations and as we have anything else in our long history of providing over site for the department safety regulatory agencies. >> well i'll be with you working closely and that is my frustration and when you get recommendations from the i.g. there is lip service and never follow through and one year

turns into two years an three years and in the case of the agency these are people's lives at stake and we need a robust regulator that will help us in the auto industry to help us with more safety with the v 2 and the v 2 v requirements coming forth. >> senator. mr. rosekind it looks like you and i are going to have a one-on-one conversation. mr. scovel it is not that i don't appreciate your work and i do appreciate both witnesses being here and i don't think i will complete the questioning. it is my understanding that we'll have more members back after they get back from the floor so hopefully if not we'll go to recess until they do. but i want to talk about this gap in consumer protection that others are talking about and last saturday i dropped my daughter's car off at the

dealership. i do most of the work myself. my father owned an automotive business and it was an independent auto business. and the question becomes if you are the third owner, fourth owner of a particular vehicle. when i went into the deepership, do they have an obligation to tell me if or not there is a recall on that particular make and model. >> they do not. that is part of the grow america authority request is to get that kind of -- if you go to a new car dealer they should do that for you automatically. >> but are they obligated to do that. >> no. >> are they obligated on a service maintenance contract to do that. >> yes they should be -- are they obligated to do that? >> yes. >> and i asked.

and i don't know that i've been to a dealership that i've dropped a car off and they've told me and maybe they don't have to unless you have a recall and i'm not putting that into question. so you are saying if i took that vehicle instead to a jiffy lube, they wouldn't be obligated to tell me if there was a recall. >> correct. >> gas station none of them are responsible? is that correct. >> that's correct. >> okay. how is that going to change? >> in grow america, we've asked to change that so that everybody, not just the new car manufacturers, but all of the independents would be required to run that check and inform you. >> if your tendency is to bring your car into an independent station what is your alternative to know about the recall? what is the alternative? >> we're recommending everybody weekly go to safer car.gov and

look up your vehicle. >> so if you are an 18-year-old girl do you think they'll go to safer car.gov. >> no way. >> and my daughter is an 18-year-old girl. and i'm a parent. and i'm a parent. and you're a patient. and as a parent that represents everybody in this room. how do you know that they'll go to safer car.gov. and i'll go there. and what percentage of america have heard of safer car.gov. >> that is a good question. and i'll check that out. and we're with you. over slaft year there is so much question about recall fatigue and how many information is out there and do people know where to go. and it is a huge problem. and what we have on our list of actions underway is creating a

national campaign. nhtsa runs click it or tick it. drive sober or get pulled over. >> it works. >> and we want to use the same technique. and it is good to be here to announce safer car.gov. and we have to figure out a way to fill those gaps. >> i'm going to stop my questioning here. and i'm going to go down to the floor and i'll turn it over to senator danes. >> thank you senator heller. i truly aim grateful this committee is highlighting the safety challenges of takata airbags that have killed eight people. however, there are other recalls that i believe need attention and further underscore's nhtsa's lack of efficacy. last summer there was a fire truck, a 2002 model, international model 4800, that

front axle, the ball and socket seized and it caused a shaft to break and seized up the left field, front wheel. it was coming down highway 12 just outside of helena montana, it is outside of boseman, i drive this all of the time and it was during daylight hours and the weather conditions were fine and they veering into oncoming traffic and the volunteer fire chief was killed in a violent head-on collision and in a family of five and a mom and dad and a family that were killed and when i drive back and forth and i went by the accident scene and you could see the mark coming in -- and the tire marks in a straightaway where this horrible collision occurred, there are six white crosses now

standing by the highway where this occurred and this particular front drive shaft has been recalled in approximately 500 vehicles with notifications being mailed this month. now this accident occurred on june 19th of last year so the notifications went out just in the last ten days -- a year after the accident. and it turns out this accident component was a nhtsa approved solution to a previous recall that occurred in 2003. with that as a background dr. rosekind the recent oig report frequently makes references to the defects, the lack of process, the procedures weak data analysis contained in the reports which i've looked over and they've made 17

recommendations to early warning data improved data processes, skernl reviews and data recommendations among other recommendations and unfortunately this is not the first time the recommendations have been made. the oig made similar recommendations in in 2002, 2004, 2011, 2014 and now here we are in 2015. and so my question dr. rosekind is nava star recommended a solution in 2014, they moved quickly, but the final recall is a year after and your recommendation is for defective components and my question is why is it taking a year, something like this and what are the nhtsa scientists and

engineers doing to expedite the solutions to mitigate the safety risks to all americans. >> i said this earlier and i don't think you can say it enough, this committee that story about the tragedy of those lives lost can't be told enough so we personalize, add a human face to every one of the tragedies. what you are highlighting is something we've emphasized identifying defects is fine. if they are not remedied you still have the risk and that is what is going on here. and part of the challenge you are citing is making sure in a timely manner a correct long-term permanent solution is in place. and so i've just learned on this and you can count on me going back and figuring out the specifics, even more of what you are telling me here to find out what is going on. >> i appreciate that. it is the face of the innocence. the fire chief returning back to forks, montana, a nice day in a strategyaway and you see a young

couple and kids in the back of a pickup and a road i drive all of the time and the innocence of the lives lost and more importantly could this have been prevented and that is the question in look at the process and the procedures and the speed at which the remedies are put in place, i would apressure you look -- appreciate you taking a look at that. and in how many times has nhtsa had one recall on the same vehicle component and i know you are new to the job and i appreciate your leadership and you know you have a long to-do list and we've had repeat recalls here to prevent these tragedies. since i'm the only leadership here i'm going to keep going with more questions until i'm out of time. and does the office of in spector general maintain stats on how often components are recalled more than once? >> we do not.

as part of current audit, we don't maintain that type of audit. we focus on the pre and post investigative process. >> that is part of the systemic challenges that exist today again with the goal here being preventing these tragedies from ever happening again, the pain the families know, the pain never goes away. nhtsa's office of defects investigation has had over a decade to implement numerous changes from the office, what are the challenges of why it is taking so long to implement. >> senator, some of the recommendations were taylors for the circumstances and the unique programs we were examining at the time. for example the 2002-2004 were

requirements of the newly enacted trent act. we were looking at the investigative age of the nhtsa recommendations. we were looking at the preinvestigative phase and i don't want to sound like i'm overly parsing this but we're trying to dissect each and every phase of the nhtsa phase of being able to commend what is going on right, find out what is going on wrong and make effective recommendations to improve. our recommendations in this case all concurred in by the agency, very aggressive time line for their implementation we believe they can be implemented with current resources and i think that is the agency 's intent. most commendable on their part. what dr. rosekind is attempting to do in our estimation is to change the organizational culture of nhtsa, at least the

defects investigation and resolution part of the operation. >> and i spent a -- 28 years in business before i took this different day job here on the hill and they say it is what you inspect, not what you expect and the importance of clear metrics and i think there should be one it looks like just on perhaps its speed in terms of how quickly are we going from an accident to action in the field here that is going to correct the defect. it seemed like when nava star was in the field within two months, why did it take a federal agency a year before -- there is a ten-month gap there. >> yes. and i think you're talking about safety steps that can be taken by way of corrective action or by way of recall. remember, again, if you will, our current audit focused on the

preinvestigative agency. we did get to the timing of that part of nhtsa effort. our audit report, not so much our statement for today's report, but our audit report at the end of last week did discuss the length of time it took for an investigative proposal to be evaluated and assessed and cited within the office of investigation and that is a key step because you'll never get to a possible action or recall at least in a position to be influenced by nhtsa unless you get through this investigation proposal evaluation and decision stage. we found one instance where an investigation languished five months. this is recently within the last year. another one on the books for more than a year without resolution. there is a circumstanceutous pattern for evaluation and discussion within the office

of defect investigation in some of the investigation proposals but again to pick up on dr. rosekind's opening remarks at this point, question assumptions, one of the assumptions that desperately must be questioned is how can we speed up the decision loop so we can get to the decision to investigative sooner and get to a decision on corrective action sooner. >> and i appreciate the balance of ensuring that were thorough and we've probably identified the problem and how to mitigate the risk. it just seems as though we're seeing a pretty big gap there and i appreciate your efforts as well to change the culture to look at ways we can move faster and the senator and chairman have just returned here. mr. chairman i'm going to turn it back to you. but thank you for your thoughtful comments. >> thank you to the senator from

montana for presiding here while we get through the vote. and i think that wraps up the first panel. so thank you mr. rosekind and mr. scovel for your time and your testimony and four your responses to our questions. i want to invite the second panel to come up and we'll get going with that.

we'll welcome our second panel of witnesses this morning. thank you for being here for your testimony. i'm going to hand it off for opening statements. we have mr. kevin kennedy executive vice president of north america for takata. mr. scott, councillorman, the senior vice president of regulatory compliance with chrysler. formally known as chrysler group. and mr. rick chostic executive vice president of honda of north america. and we'll ask, mr. candy if you'll proceed with your

testimony and we'll go from there. and if you can, confine it as close to five minutes as possible and we'll take it from there. mr. kennedy. >> [ inaudible ]. >> sir turn on your mic. >> is it on now? okay. any apologies. chairman thune ranking member, nelson and distinct wished members of the committee, i'm honored to be lear on behalf of takata and our employees throughout the united states. for takata, safety is the core of what we do and who we are. we are proud that takata airbags have saved thousands of lives and prevented serious of injuries in hundreds of thousands of accidents. it is unacceptable to us for one of our products to fail to perform as intended. we deeply regret each instance in which someone has been injured or killed.

we will do everything in our power to address the safety concerns raised by airbag ruptures. our chairman met twice with administrator rosekind and made that commitment personally. that is why after personally. after months of testing and extensive analysis, we agreed with nhtsa to respond to your concerns and those of the public. our agreement with nhtsa contemplates dramatically expand expanded recalls going well beyond the scope of the risk suggested by the science and testing. based on more than 57000 tests of returned inflators in years of research by leading experts from around the world our best current judgment is the rupture issues are related to long-term exposure over many years to persistent conditions of high heat and high absolute humidity. some inflators, these issues may

also involve potential manufacturing and vehicle specific factors. most field ruptures have involved overinflators in the region of high heat and absolute humidity. in all analysis to date indicates the potential for rupture is limited to a small fraction of inflators. that's why takata's filings state a safety related defect may arise in some inflators. not all of the inflators are defective. even one rupture is too many. so a remedy program is much broader. most of the injuries and all of the fatalities in the u.s. involve driver side air bag inflators that feature the bat wing shaped propeller. we've agreed to replace all of the bat wing inflators from the start of production through the end of the production in any

vehicle registered in the united states. these recalls will proceed in stages and the final stage will include the bat wing inflators previously installed as remedy parts. we're ceasing production of the bat wing inflators altogether. there have been far fewer ruptures involving passenger side air bags. our agreement with nhtsa contemplates significant recalls for passenger air bags. our total production of replacement kits for north america will soon reach 1 million per month. we've augmented our capacity to produce replacement kits by including replacements made by other supply irs. we are investing in innovations to develop a range of new inflator products. at the same time, takata continues to service customers by producing air bags which have

distinct safety and efficiency benefits. we have full confidence in the safety of these products. we're using various technologies in response to the recalls. the process of qualifying new products takes time and for certain vehicle models the best solution today is to use existing technologies in place of the original unit. we agree with nhtsa it is absolutely the right response to public safety concerns not to wait but to replace an older unit with a new inflator. doing so provides an important safety benefit. we've agreed to do ongoing testing to verify the safety and service life of these remedy parts. if they need to be replaced in the future, we'll ask before a potential risk of rupture develops. we are supporting the work of nhtsa and the independent quality assurance panel led by

sam skinner. and we will work with though automakers to get the word out to consumers to maximize the recall completion rates. we'll continue to do all we can and we'll keep you and the public updated on our progress. >> thank you, mr. kennedy. mr. kunselman. >> thank you for the opportunity to appear today and provide an update on this important matter. i'm the senior vice president head of vehicle safety and regulatory compliance. i lead a mission we embrace with passion. as you know, fca's involvement with takata air bags is extensive and ongoing.

today's automobiles among the most complex on the consumer market. auto manufacturers are committed to reduce injuries resulting from motor vehicle xss. we work to design engineer and manufacture vehicles to withstand a myriad of operating conditions. promoting and ensuring safety is shared by automakers, suppliers, government and consumers. fca looks forward to this collective engagement with takata and nhtsa. fca has remained actively engaged since i spoke with this committee last november. much has transpired edd since that time. through multiple campaign recall expansions, fca is now in the process of recalling 4.8 million inflators in approximately 4.5

million vehicles across the united states. we are also aggressively taking actions on multiple fronts to assist in determining the root cause of ruptures which remains unknown at this time. trying to independently determine the root cause of inflator ruptures. fca continues to return recalled inflators to takata to further their research and understanding. despite a root cause determination, fca's mission to implement solutions that will improve the safety of our customers has not been delayed. i'm pleased to share as of june 8th 2015, fca is replacing all driver's side inflators involved with an alternative and permanent design provided through trw.

customers will require no further action on their vehicles. the takata inflators no longer need are being quarantined and returned. all of the approximately 50,000 customers who previously received a takata inflator will be advised to return for the trw. we've been working with takata to develop improved versions of the passenger side designs. it will help protect the propellant from moisture exposure. they'll complete validation testing in august and fca expects to begin installing those in november next year. fca continues to be aware of just a single incident involving a driver's side air bag causing an injury in one of our vehicles. our actions demonstrate the abundance of caution to protect our customers. i would like to reiterate that

promoting vehicle safety is the responsibility shared by automakers, suppliers, government and consumers and fca will continue to collaborate with takata nhtsa and others to address this matter. i extend my thanks to the committee for discussing this issue and i would be pleased to answer any questions. >> mr. schostek. >> thank you, mr. chairman. i appreciate the opportunity to update the committee on our efforts since my last appearance before this committee. in the past two weeks we've confirmed two more customers lost their lives. one in september 2014 and the other in april of this year as a result of takata air bag inflator ruptures that have occurred in our older model vehicles. this is heartbreaking. and a painful reminder of the reason we continue to accelerate our actions to repair the affected vehicles.

of course, the real pain is experienced by the families of the victims. we sincerely apologize to them and extend our deepest sympathies. we are working hard to solve this problem. over and above the required mail notification to affected customers, we've pursued new ideas to encourage our customers to check their vehicle identification number in order to increase the rate of response. we've enhanced our general recalls website and created a new microsite dedicated to this issue to keep consumers informed and make it easier for them to check their vehicles for open recalls. honda voluntarily issue inned a bilingual regional advertising effort in march to implore customers to repair their cars. this campaign of radio xhishl commercials and full-page newspaper ads was designed to grab the attention of customers

in the nine high temperature and natural humidity states and two u.s. state territories. we're also using social media challenges, including via facebook, with good success. let me add, mr. chairman, whenever we issue a press release or statement on this matter we specifically request the news media help us spread the word by directing customers to our recall websites so they can look up their vin and get their air bag repaired. to accelerate the safety actions, honda proactively began searching for alternate supply solutions to more quickly facilitate the repairs. that led to agreements with diecell, auto league and trw to provide us with replacement parts, in addition to takata. as a result of this action, we are averaging more than 50,000

repairs per week. we have also asked our dealers to expand their service hours and never turn away a customer with an affected vehicle. we encourage dealers to check the vin for every vehicle that comes into their dealership. we initiated a new system that alerts dealers whenever their staff fails to check the vin to see if it has an open recall. we've also enforced honda's policy to provide them with aerer or rental car while their vehicle is being repaired. all dealers are authorized to make a vehicle available to a customer. we've been searching salvage yards to find recalled inflators. we've already identified many that now never will be installed in another vehicle. in some markets we've enlisted a

special investigative firm as part of our effort to contact hard to reach owners of older affected models affected by the takata recalls. for many reasons it's difficult to locate the owners of oiledlder vehicles and get them repaired. i suggest we find a way to tie the annual state vehicle registration that safety defects be addressed before the completion of vehicle registration. ms. stephanie erdman who was injured by a takata inflation rupture joined me in writing an op ed in auto motive news in support of such an idea of registration requirement. we continue to believe there's substantial promise with this approach and want to thank senators markey and blumenthal for introducing s-617. i recognize there are some issues that require further discussion, but i'm convinced

this is the single most significant step we can take. i appreciate the opportunity to be here and would be happy to address your questions. >> nhtsa urged takata to get replacement inflators in vehicles as quickly as possible even if the root cause has not yet been identified and those replacements may have to be replaced again some years down the road. we're all concerned that this very serious safety issue has persisted for way too long. we've got -- eight people have died. numerous others have received serious injuries. takata has been looking at this problem for several years. we need to know why this happened and make sure it doesn't happen again. so tell me what takata is doing to find the root cause. >> senator we have been working

with a number of avenues to get to root cause. as you mentioned, we've been working on this for a number of years. we've been working with a institute from germany who is the leading expert in the world on propellants and pressure designs. we have learned much in though last six to eight months as to what the root cause of this is. we understand the mechanism. we understand a number of the factors that cause the issues. but as you said we do not have a definitive root cause we can turn on and off. we've gone forward with nhtsa and automakers to replace parts because this is in the best interest of the public safety. >> without a root cause though we don't know whether or not the new replacement inflators have the same defect. so why is it a good idea to put new inflators into cars that

might have the same defect? >> let me talk about that a little bit. many of the replacement parts are alternative designs. they aren't the same that was originally used. particularly on the driver's side the bat wing inflators had caused all the fatalities in the field and most of the serious injuries. we're not replacing with bat wings. we'll go out and get every bat wing that was ever made including all of the remedy parts. and we're also, as mr. kunselman and mr. schostek talked, about we're using alternate inflators from competitors in order to speed replacement parts out to the field. and we're working to replace the current ones in order to make them more robust. part of the consent order requires us and nhtsa and the automakers to continue to get the parts back and evaluate the

remedy parts to make sure they are safe. >> these replacement bags though, are they going to be safer than the original equipment, than the original air bags? >> we know -- what we do know is it takes a considerably long time for this condition to manifest itself. previously administrator rosekind said 7 to 12 years. we know there's a large increase in public safety and margin of safety by just putting a brand new inflator in. on some of the passenger side ones there were some manufacturing defects we've been ablg able to uncover. we feel very confident in the inflators that we are making today. >> mr. kunselman they are saying they are safe in the interim but may require

replacement in the future. you stated that fiat chrysler of america will be replacing all recalled driver's side with the trw and describe trw's design as permanent. customers who receive the trw replacement will not need to come back in for a replacement. given that we don't know the root cause for this why are you confident the trws will not have to be replaced in the near future? >> the trw inflator we're replacing with takata's help has a track record. and we're not aware of any issues with its previous use in the field. we were fortunate to have an available inflator with the right characteristics to utilize in our vehicle program. that explains the confidence. >> for our automakers, i'm sure

you both recall because we had her in here, lieutenant stephanie erdman who was seriously injured by shrapnel from a takata air bag. she took her vehicle to a honda dealership three times without being informs her vehicle was subject to an open recall. three times. so what steps have you all taken since then to work with your dealers? you describe some of this in your testimony. how are you going to give us an assureance these important safety recalls have been addressed and they are going to be shared with customers when they get their vehicles in and have them serviced. >> we have more than 1200 honda and acura dealerships. we've been working hard with them.

we've been doing a number of things since we were last here in november. a new report flags the dealer neglected to check a vin when a customer came in. we've had face to face meetings with our dealers. zone managers and district managers. they've personally visited every dealer and talked to each dealer about the importance of checking about open recalls. we have periodic regional meetings. we have in the last several months reinforced that obligation. mr. chairman there is sometimes turnover at a dealership. we need to make sure that education is well understood and the dealer principals understand this is our expectation of them and we'll check every one of these vins. we've taken multiple efforts and will continue to do so to remind them of their obligation. >> i would reiterate many of the

same points we are doing as well with respect to informing the dealer of the responsibility. i'd add to it something he mentioned earlier. we've made sure technology is also there to make this an automatic step in the process. when a vehicle rolls in to the service bay in most cases in an automated fashion, the vehicle uploads the information to the service writer and they go out of their way to schedule that activity on that visit or on an immediately subsequent visit. in addition to the reminders of responsibility and urgency we're making sure the technology exists. it's not left to human hands but to the machine can point this out to the service rep. >> thank you. senator nelson? >> would you all hold up that photograph, please? this is a picture of a massive

explosion in 2006 in your mexico plant. it was so massive that it blew out windows a kilometer away. this plant used the ammonium nitrate propellants to make air bag inflators. is that correct? >> whyyes, sir, that is correct. >> and in your written response to our committee's november letter, the committee said that explosion was caused by quote, improper storage of propellant scrap. is that right? >> yes, sir. yes, senator, that's correct. >> is that the type of concern that your safety audits were intended to identify? >> one of them, yes, sir.

>> then why would takata decide to halt these audits for financial reasons? >> yeah, i'm -- i believe you're referring to the report issued yesterday by the staff of the committee. there were -- i think that misrepresents exactly what happened, sir. if you would allow me i will explain that. >> certainly. >> what that was referring to first of all there are a number of safety and quality audits done on the product. the audits that were referred to were not the safety and quality audits on the products. that was implied or inferred from the report. secondly, the only thing that was suspended was the participation of people from other regions of the world. we held the local safety audits. we held the local quality audits. they were all done on schedule and completed. the only thing that e-mail was

referring to was participants from other parts of the world were not to be included in the audit. >> all right. >> but i'm trying to get at this. hasn't takata blamed the defective air bags on how your plants handled the ammonium nitrate propellants and how your plants assembled the inflators? >> there were some of the earlier recalls that were announced 2008, 2009 where we identified manufacturing defects that included the pressing of propellant disc as well as exposure to humdity during the process. >> so the answer is yes? so if you are saying that these pyrotechnic handling problems had to do with the safety of the inflators, wouldn't you have had a clue in 2006 when that happened? >> absolutely.

absolutely we did. we had issues at the plant, material, scrap material was mixed and that is what led to that particular incident. fortunately, no one was injured in that incident other than, i think, someone sprained their wrist walking out the door. we completely cleared the plant. no one was injured no one was hurt and we revised the number of our safety and handling procedures following that. they were completely redone after that. >> and yet knowing that something is going on here it's nine years later -- >> yes sir. >> -- and now we see -- now explain this bat wing design and why you think that is the culprit. >> well, the bat wing design is a name the engineers came up with to describe the shape of the propellant wafer inside.

there's really nothing about it other than that. >> the propellant that caused that explosion? >> it was the mixes of different types of propellant and energetic materials that led to that particular incident. >> did you -- did it occur to you back in 2006 with this that humidity might have had something to do with it? >> i haven't reviewed the report, and i don't remember it from that long ago, senator but i don't recall that humidity was an issue in that particular incident at the facility. >> what about -- >> i can double check that to be sure and get back to you. that's my recollection. >> what about all these deaths in the south? you think humidity is one of the contributing factors? >> yes senator, we do. the report from the pronghover institute has concluded they think it is a multifactor

combination of age, exposure to high absolute humidity and high temperature. >> then how do you explain the southern california where there is a mild temperature death? >> that's why we're continuing to look into the issue. we haven't dropped it. we have experts from penn state. we have experts from georgia tech. we have the pronghoffer institute. we're working with a vast array of experts in this field and we're continuing to investigate to continue to run into ground so we know exactly what happened. that's why we decided to act with nhtsa and the automakers to get these parts now. it's the right thing to do for public safety. >> would you want your daughter to drive a vehicle with takata air bag that you had replaced the bat wing ammonium nitrate?

>> the car my wife and children drive in every day uses one of these ammonium nitrate inflators. >> did you replace the bat wing? >> it was on the passenger side. >> is that the only place it's replaced? >> bat wings is just a driver side design. it's not used on the passenger side at all. it's purely a driver's side issue. >> you are attributing the bat wing sdoon to part of the defect? >> that's what the data and testing have shown. that's where all of the fatalities and most of the serious injuries have involved the bat wings. >> then i didn't understand your answer that you suddenly jumped to the passenger side. >> you asked me if i would -- maybe i misinterpreted your question. >> if your daughter were driving the automobile that you had replaced the bat wing design in

the driver's side -- >> i would have no issue with that at all, senator. none. >> well i tell you there are a lot of consumers that would. how do you think that the consumers can feel that this thing is fixed? >> well that was why again, sticking with the bat wing on the driver's side, we've agreed to go replace every one of these. get the parts and get them out of the field. a lot of people have talked about the efforts to do that. and that is really one area where we as an industry and a government need to concentrate is to get the parts out of the field once there has been a defect analyzed. and declared. >> mr. kunselman, you don't feel confident enough that it's fixed. you've gone to a new air bag manufacturer. tell us about that. >> why thank you.

as i stated, we were fortuitous in the ability to identify an alternative that would perform appropriately in our vehicle given the demands of the fill rate and size of the air bag. and so we did quickly move here to gain confidence that this would be a permanent solution even in absence of root cause, not understanding what ultimately might happen. this is why we took this path. >> may i regurgitate your words and you tell me if this is what you just said? we wanted a clear path to greater confidence so we went with another manufacturer? >> that's correct. >> okay. thank you, mr. chairman. senator blumenthal. >> thank you, senator nelson. thank you for being here today all of you. mr. kennedy, you have been with takata for only about three years, correct? >> no sir i've been with

takata just over ten years. >> ten years? sorry. so you were with the company back in 2005? >> i started in december of 2004, correct. >> i'd like you to commit as executive vice president of this company that takata will establish a compensation fund similar to the one gm established. >> yeah, i haven't been involved in that end of the recall at this point, sir so i can't do that. i'll certainly take that back to our chairman and to our team and discuss that and get back with you on that. but i'm not in a position today to commit to that. >> don't you run the company's north american operation? >> i have responsibility for certain aspects in north america. i'm responsible for our customer activity including sales and marketing. engineering, application engineering, program management. some of our core engine o'ering

not related to inflateors but other core projects and some i.t. and communications. >> well i'm just a country lawyer from connecticut but it sounds like you run this company in north america. >> i report to an executive committee and a president of north america. so i do not run all aspects of the north american operation, sir. >> how soon can you come back with an answer about a compensation fund? >> i would think in the next -- would four weeks be sufficient? >> how about the next two weeks? >> yes, sir. >> my view is that takata is every bit as responsible for the eight deaths found so far as gm is for the 117 deaths and counting. and the number eight is still as of today, the compensation fund that you should establish, in my opinion is likely to

disclose additional deaths that resulted from this defective product. would you agree? >> i would agree it is probably likely as many of these parts are still in the field. >> in fact, let me show you one of those parts. this is a takata inflator that caused the explosion in this air bag that caused these holes. it didn't shred the air bag but the shards that came through the air bag caused by the explosion piercing this metal. and you can see where the shards emanated. could well have caused the kinds of deaths we've seen eight times so far, demonstrated eight times so far, correct? >> and i just want to repeat how deeply sorry we are for all of

the pain and sorrow we have caused. >> i'm not challenging whether you're sorry. i believe sincerely that you are. but my question is in replacing these bat wing propellants, have you also replaced the chemical ammonium nitrate that was used in these bat wing propellants? >> some of the replacement parts we are using for those bat wings still include a phase stabling ammonium nitrate but it's a different design that wife not experienced issues with. >> you haven't experienced issues with it because you haven't finished testing it? >> well, they have been in the field for a number of years, used in a number of different vehicles and we've -- it's just alternative designs have not seen issues. >> why are you continuing to use

ammonium nitrate when it was very likely a contributing factor, if not the factor in causing these exploding inflators. >> first, i respectfully would disagree it's the issue with causing the inflator ruptures. it could be one of the potential factors in it. but phase stable ammonium nitrate has many benefits. azide is highly toxic. and some of the other materials we used had issues with handling and manufacturing because they were very very energetic in a normal state. phase stabilized ammonium nitrate if you put it on the table and put a torch to it you can't light it. it's very clean and burns

efurbiently which addressed some of the concerns in the field with previous propellants causing respiratory issues with many many drivers. >> but the problem is it becomes unstable when it becomes moist or accumulates moisture. >> it's not a phase stabilization issue. this is what everyone was concentrating on in the begin beginning. it's an issue with the phase stabilization of ammonium nitrate. the conditions the pronghoffer institute came to is this is not a phase stabilization issue. we can't even measure the phase stabilization that's occurred. it's not a phase stabilization issue. this is a much more subtle issue that takes many, many factors over many, many years and sometimes in certain vehicles. sometimes in one vehicle it will perform perfectly well. the same part in another vehicle and the same exact area will have different issues. there are a number of things we don't understand but that's why

we felt it was time to act and get the parts out of the field to continue this analysis of the parts. >> you're continuing to use ammonium nitrate but with a different design? >> we have many designs that use phase stabilized ammonium nitrate. there are, of the -- i think of the six involved, most are -- five of the six are out of production. there will be another one out shortly. the ones involved in this particular issue in these particular issues in these particular recalls are not in production any longer. >> looking forward, are you replacing the bat wing propellants or inflators out there now with inflators that have ammonium nitrate? >> some of them are still using -- it's a completely different inflator and propellant design. some still use phase stabilized ammonium nitrate. but we oarare -- i think in may,

fist 50% included from our competitors and 50% with outside inflators. so most of the replacements are alternative propellant designs. even the ones that aren't are using later versions of ammonium nitrate for the most part at this pont. >> have you tested these new designs? >> we have. >> how rigorously? >> very rigorously and many have been in production for many years. >> have they shown signs of moisture? >> not to my knowledge. >> but you're continuing to use ammonium nitrate? >> yes. >> and that's one of the reasons why you are going to trw, correct? >> thank you. the path to the trw inflator was fortuitous. should the inflation characteristics in the car and

provided me with the most confidence that it would be a permanent solution. >> i think that's a very gentle and nice way of saying you want a safe propellant and so you're going with a company that does not use ammonium nitrate? is that correct? >> that is accurate. >> mr. kennedy your company filed for a patent in 2006 that in effect demonstrated the knowledge of moisture's affect on ammonium nitrate correct? >> i'm sorry i'm not involved in the patents on inflators, senator. if you give me a little more information, i might be able to comment. >> i'll give you information that's available to all of us which is that your company explained that moisture could seep into the inflator and might cause the propellant to become

more unstable. it said that numerous times and fooled filed for a patent in 2006 that said it was aware of that problem in 2006. >> automatici'm not familiar with that patent but moisture seepage into any inflator is an issue. and moisture particularly with ammonium newterate is an nitrate is an issue. that's why we've designed it in our manufacturing process. >> are you familiar with the chemical known as desiccant? >> yes, senator, i'm aware. >> at what point did takata begin to add that? >> i believe in 2007, 2008. >> and the reason it added desiccant was to reduce the effects of moisture in making the ammonium nitrate more unstable. >> there were a number of

changes that were made. a number of design changes made in the x series inflators in that time period. the propellant formulation was changed. desiccant was added. a number of other components was added. it's part of what in japan they call continuous improvement. constantly looking at ways to improve those parts. on the passenger side we were able to shrink the size of the inflator. it helped meet cap a requirements and helped our customers meet their goals of weight redetection and per formance. >> continuous improvement? >> yes. >> your term? >> kaizan is what the japanese call it. >> in japanese it sounds like a euphemism for trying to avoid exploding air bags. >> no, sir not at all. i disagree. it was a continuous improvement

to improve the product. every manufacturer of every product is -- >> how did it improve the product? besides avoiding the propellants exploding as a result of moisture. >> as i said, there were a num are about of changes implemented. desiccant was -- the addition of desiccant was one of them. it allowed us to make the inflator smaller lighter. those were all things that we are always looking to do. >> isn't it fair to say that one of the reasons for that continuous improvement was the presence of moisture inside the inflator? >> as i said, moisture in any inflator is a problem. and every inflator has leak paths that allow moisture in. every inflator out there. at the end of the day, an inflator is full of holes, too lou gas come out. there's holes to let moisture

in. it's an issue that every inflator manufacturer deals with. >> your new inflators have they shown evidence of moisture? >> i don't -- i'm not sure if i can answer that completely, senator, because i don't know that we've gotten parts back from the field on the newer ones and looked at that on every one of them. >> i thought your testimony was they've been rigorously tested. >> they have. they have. >> but you don't know whether moisture has been found in them? >> i don't know the answer to that specific question senator. >> where i'm going here, mr. kennedy, essentially is that there is a lot of evidence that ammonium nitrate is a root cause and that there may well need to be a recall of the recalls. and continuing problems. gm at least redesigned and

remanufactured the defective product that caused deaths on the road as a result of the defective ignition switch. but the continued use of ammonium nitrate leads me to believe there may need to be a recall of the recalled parts. >> as part of the consent order we've agreed to continue to test the remedy parts. we've continued all of our efforts internal and external with the consortium of oems that mr. kunselman mentioned with individual oems. automakers doing their own testing. we have not stand anything, senator, in relation to this issue. we are continuing to look and we are continuing to look everywhere to make sure that we understand this issue. >> good. >> have you issued -- i just have one more question. two more questions.

>> well, we need to keep moving, senator. >> and i've been actually asking a few extra questions because i knew my colleague senator klobuchar was going to be here. >> oh, yes. you're so kind. >> let me ask mr. schostek would you commit to supporting a bill that i've offered, s-900 that requires used car dealers to repair any outstanding safety repairs friar selling or leasing them. >> we do support that concept. right now honda dealers sell both new cars and used cars and we expect those recalls to be taken care of before the used cars of sold. they may have a product from a different manufacturer on the lot. we'd like to discuss about the need to ensure the responsibility of the oem to make sure that repair is

completed and who is effecting the repair. we support the concept. >> you reached out to two of the honda owners that were affected here but you couldn't contact them because they bought the car used, correct? carlos solas and tran died both as a result of this product. >> the unfortunate aspect of the fatalities experienced in our vehicles are older model vehicles. they've tended to change hands sometimes through independent used car dealers and we've not been able to contact the appropriate parties. we definitely understand the concept. >> senator klobuchar. >> thank you, mr. chair. i will be brief. mr. kennedy last november as evidence emerged the air bags might be susceptible in regions outside of high humid irt climates, i called on an expanded recall in december of last year. takata responded to nhtsa's request letter stating it

believed the data and currently available information did not support a nationwide recall. what information did takata have last month that it didn't have earlier that triggered the expanded recall. >> senator, that's a great question. we have much much more test data now than we had before. we've completed i checked last night, as of last night over 57,000 deployments. most of those in the last six months that have helped us to understand where these issues are and what is causing them. we don't have definitive root cause but also in that time frame we had a two-day meeting in our inflator facility where we brought all the nhtsa people in and had our third party pronghoffer report to them. it was not filtered by takata at all. we've continued to work with a number of other outside experts. penn state university, georgia

tech. >> but it is just this goes back to 2006. i'm glad you've done this. it seems like such a long period of time. we've heard so many different explanations for the cause of the deflect. why the different explanations and why did this take so long and nearly ten years to get done. >> there's been a number of recalls that have been issued starting, i believe, in 2008 was the first one. so we have participated and supported multiple recalls in that time frame and it was just really on this latest issue that got started in 2013. end of 2013 is when the first incident outside a previous recall populations occurred. >> now with this major recall that you've decided to undertake with a lot of prodding i would say, and it's going to involve a

lot of vehicles, how do you prioritize these vehicles in terms of getting fixed? geographically? by the age of the vehicle? how are you going to triage this? >> it's a very good question and contemplated in the defect information reports. it varies by design somewhat. the driver side ones where we've had the most issues in the field, those are being prioritized based on location. and that would be a location of where they are currently registered originally registered or ever registered. some are prioritized by age and as administrator rosekind mentioned in his testimony that is part of the consent order. the coordinated remedy. we'll be working with nhtsa and all of the automakers in order to do that prioritization and increase supply to get the right parts to the right owners at the

right time. >> how many replacement parts is takata producing every month. >> we passed 5 million replacement kits. we are right now i think this month we'll probably produce close to 700,000. >> how many are there going to be total? >> the total replacement, again, numbers are a little elusive but somewhere in the 32 million range. that's vehicles ever manufactured. >> okay. >> some of those may still not be on the road. >> how long do you think it will take to do that? >> we'll be at a million units a month very shortly. we've already done 5 million. that 32 million assumes all of those vehicles are on the road. we know vehicles that are 15 years old a number of those are not on the road still. it will be somewhat less than that. >> one last question here. mr. kunselman and mr. schostek,

how many affected honda and chrysler vehicles have received replacements? >> on the driver's side we had just shy of 50,000 units replaced with a like bag and we've now implemented a recall where we'll replace with a trw inflator. maybe 1,000 so far. it was just released june 8th. >> we've released nearly 2 million takata inflators. >> it sounds like a lot more. they're not all your vehicles obviously, but more to come. all right. thank you very much. >> senator nelson has one question to ask. he'll be back in here momentarily. until he gets back our manufacturers, if your companies or other auto manufacturers are looking into what role, if any the vehicle design may have played with regard to persistent

high humidity affecting the performance, and if so what have you learned. >> i'll answer that first mr. chairman. you are referring to the report recently that takata is mentioning a theory about the vehicle design. i think this is mainly on the passenger side, not the driver's side where this theory is grounded. we've not received much information from takata about this vehicle design theory, and when we, do we will be happy to look into it. we've not begun a study of our own on that idea. >> i'd reiterate that. we are aware of takata seeing this trend and are asking the itc if they see a similar trend based on the parts coming from the field. >> senator nelson? >> just one quick question mr.

schostek do you think that rental car companies should be prohibited from leasing vehicles under recall until they are fixed? >> thank you, senator nelson. i'm aware of s-2819 the rental car recall act that would prohibit rental car companies from renting. we are in support of that concept, senator. we support the concept. the young woman who lost her life in southern california was driving a vehicle that she -- a honda vehicle she rented from an agency in the san diego area. understand from our business model, we do not sell to fleets. we don't sell to big rental car companies such as hertz avis and so forth. nevertheless, there are honda vehicles that end up in rental car inventory. some -- our dealers might sell to one of those large rental car

companies. the small rental car companies might also buy our vehicle on the used market. we strongly support the concept they should be fixed before they are rented to a customer. if that happened in the case of the young woman in southern california, who, by the way, we notified the auto auction that owned the vehicle before the rental agency bought it and none of them took that repair. it's to our everlasting regret that had an impact in this incident. >> thank you. >> thank you senator nelson. well, just to point out that the hearing record will remain open for two weeks during which times senators are asked to submit any questions for the record. upon receipt the witnesses are asked to submit their written answers to the committee as soon as possible. i want to thank our panelists and witnesses here today for your testimony for your responses. it continues to shape the record

that we build with regard to this very important issue which has had life and death consequences for people across this country and we want to make sure that we're doing everything we can to get the accountability and provide hopefully the solutions that will prevent this sort of thing from ever happening again. with that, the hearing is adbjornad adjourned. thanks.

coming up in about 15 minutes on c-span3 louisiana governor bobby jindal will officially announce his candidacy for the 2016 presidential race at an event in kenner louisiana, just outside new orleans. governor jindal is serving his second term in office. prior to that he was a congressman for louisiana's 1st district. we'll have his campaign announcement live at 5:00 p.m. eastern on c-span3. from earlier today at the house, president obama announces changes to american hostage policy. the associated press says the president cleared the way for families of u.s. hostages to pay ransom to terror groups without

fear of prosecution. >> good afternoon. since 9/11 more than 80 americans have been taken hostage by murderous groups engaged in terrorism or privacy. for these innocent men and women, tourists, journalists humanitarians, it's a horror and cruelty beyond description. for their families and for their friends, it's an unrelenting nightmare that the riftest of us cannot bebegin to imagine. as a government, we should always do everything in our

power to bring these americans home safe and to support their families. dedicated public servants across our government work tirelessly to do so. our military personnel risk their lives in dangerous missions, such as the operation i authorized last year that attempted to rescue americans held in syria and yemen. there have been successes such as the rescue of captain richard philips held by somali pirates or jessica buchanan, rescued from somalia. of these more than 80 americans taken hostage since 9/11, more than half have ultimately come home. some after many years. tragical lie tragically, too many others have not. at this very moment americans continue to be held by terrorist groups or detained unjustly by foreign governments. for them, the nightmare goes on and so does our work day and

night to reunite them with their loved ones. as i've said before, the terrorist threat is evolving. the world has been appalled by the barbaric murder of hostages including americans. the families of hostages have told us and told me directly about their frequent frustrations in dealing with their own government. how different departments and agencies aren't always coordinated, how there's been confusion and conflicting information about what the government is willing to do to help, how they've felt lost in the bureaucracy and some families feel they've been threatened for exploring certain options to bring their loved ones home. that's totally unacceptable. as i have gotten to know some of these families and heard some of these stories it has been my solemn commitment to make sure that they feel fully supported

in their efforts to get their families home. and that there is a syncing up of what i know to be sincere relentless efforts within government and the families who, obviously, have one priority and one priority only, and that's getting their loved ones back. these families have already suffered enough, and they should never feel ignoredor victimized by their own government. diane foley whose son jim was killed this last year said as americans, we can do better. i totally agree. we must do better. and that's why i ordered a comprehensive review of our hostage policy. i want to thank everybody who contributed to this review inside and outside of government. some of whom are here today. i especially want to thank the former hostages and families who

contributed. i have come to know some of these families, often under the most heartbracking of circumstances. when her son peter,als known as abdul rahman was man was being held in syria her son wrote wrote me a lotter and wonder if her son could see them too. a reminder of the bond they might still share. i've called these families to offer our condolences after they've received gut-wrenching news after they've received news no family wants to hear. i've hugs them and grieved with them. i just spent time with some families as well as former hostages here at the white house. and needless to say it was a very emotional meeting. some are still grieving. i thank them for sharing their skmeeshss and their -- experiences and their ideas with the review team.

in fact many of the changes we're announcing today are a direct result of their recommendations. i acknowledge to them in private what i want to share publicly. that it is true that there have been times where our government regardless of good intentions has let them down. i promised them that we can do better. here is how. today i'm formallyish oog you a new policy directive to improve how we work to bring home american hostages and how we support their families. i've signed a new executive order to make sure our country can do so and i've described the two dozen specific steps we're taking. broadly speaking they fall into three areas. first i'm updating the hostage policy and making it clear it is the safe and rapid recovery of our american hostages and to do

so we'll use all elements of our national power. i am reaffirming that the united states government will not make concessions, such as paying ransom so terrorist groups holding american host anls. and i know this can be a subject of significant public debate. it is a difficult and emotional issue for the families. and i've said to the families gathered here today and to families in the past. i look at this not just as a president but as a husband and a father. and if my family were at risk, obviously i would move heaven and earth to get those loved ones back. as president i also have to consider our larger national security. i firmly believe that the united states government paying ransom to terrorists risks endanger more americans and funding the very terrorist that we're trying to stop.

and so i firmly believe that our policy ultimate puts fewer americans at risk. at the same time we are clarifying that our policy does not prevent communication with hostage takers by the government, the families of hostages or third parties who help these families. and when appropriate, our government may assist these families and private efforts in those communications. in part, to ensure the safety of the family members and to make sure they are not defrauded. so my message to these families were simple. we're not going to abandon you. we will stand by you. second, we're making changes to ensure that our government is better organized around this mission. every department that is involved in our national security apparatus cares deeply about these hostages prioritizes them and works

really hard but they are not always as well coordinated as they need to be. under the national security council here at the white house we are setting up a response group comprised of those across our government to make sure our policies are consistent and coordinated and implemented rapidly and effectively and they will be accountable at the highest levels. they'll be accountable to me. soon i'll be designating as well a senior diplomat as my special envoy for hostage affairs who will focus on diplomatic efforts to bring those people home. we're creating for the first time one central hub where experts across government will work together side by side as one coordinated team to find american hostages and bring them

home safely. this fusion sell located at the fbi is up and running and we're designating a new officials in the intelligence community for coordinating the rapid dissemination for intelligence related to american hostages to act on that intelligence quickly. third and running through all of these efforts we are fundamentally changing how our government works for families of hostages. many of the families told us that they at times felt like an after thought or a distraction. that too often the law enforcement or military and intelligence officials they were interacting with were begrudging in giving them information. and that ends today. i'm making it clear that these families are to be treated like what they are our trusted partners and active partners in the recovery of their loved

ones. we are all on the same team and nobody cares more about bringing home these americans than their own families and we have to treat them as partners. so specifically our new fusion cell will include a person dedicating to support the family from the government. and the coordinator will ensure we coordinate with families better with one clear voice and families get information timely and accurate. working with the intelligence community we'll share more intelligence with families and coordinate with government and making sure when decisions are made about loved ones thur concerns are front and center. everyone who deals with the families on a regular basis will be given additional training to make sure families are treated with dignity and compassion that they deserve. in particular, i want to point out that no family of an american hostage has ever been prosecuted for paying a ransom for the return of their loved

ones. and the last thing that we should ever do is to add to a family's pain with threats like that. so the bottom line is this, when it comes to how our government works to recover americans held hostage and how we work with their families we are changing how we do business. after everything they've endured, the families have a right to be skeptical and that is why it is important, as i told them today, that we will be setting up mechanisms to ensure accountability and implementation. i've directed my national security team to report back to me including getting feedback from the families to make sure that these reforms are being put in place and that they are working. now in the course of our review, several families told us they wanted to spare other families the frustrations they endured. sp have even created new organizations to support

families like their or to honor their loved ones such as the foundation for steven so the love who woet that everyone has two loves and the second one realizes begins when you realize you only have one. as a government and a nation we can learn from the strength of their lives and the kind of strength we've seen in all of these held hostages including kayla mueller. she devoted her life to serving those in need around the world to refugees in syria who lost everything she was a source of comfort and home. before her tragedy death she was held in sear by isil for a year and a half and she managed to smuggle a letter to her family. she said none of us could known it would be this long but i know i'm fighting for my side and the ways that i'm able and i have say lot of fight left in me. i'm not breaking down and i will

not give in, no matter how long it takes. today my message to anyone who harms americans is that we do not forget. our reach is long, justice will be done. my message to every american being held unjustly around the world who is fighting from the inside to survive another day, my message to their families who long to hold them once more is that the united states of america will never stop working to reunite you with your family. we will not give up. no matter how long it takes. thank you very much everybody. >> [ inaudible ]. >> coming up in a few minutes here on c-span 3, live coverage

of louisiana governor bobby jindal's announcement that he is entering the race for the 2016 presidential nomination, coming from kenner, louisiana just outside of new orleans. first we hear from more about what to expect from bobby jindal from a political reporter. >> i'm joined on the phone by elizabeth crisp from the capitol news reporter to talk about the bobby jindal 2016 campaign announcement. so where will the announcement take place and does it have significance for his campaign. >> the announcement will take place in kenner which is just outside of new orleans and that is where governor jindal when he was in congress, that is where he lived. and so jefferson parish is a republican strong hold so there is significance for him. >> and how has the governor