Big fines for selling cars with deadly airbags

The ACCC has fined three businesses for allegedly advertising or selling vehicles fitted with defective Takata airbags.

Grays Ecommerce Group Limited (Grays), Berwick Motor Group Pty Ltd (BMG) and HG Innovations Pty Ltd (HG Innovations) have paid a total of $63,000 in penalties to the ACCC.

BMG and HG Innovations have paid $12,600 each after the ACCC issued both of them with an infringement notice for selling a vehicle under active recall.

Selling vehicles under active recall is prohibited by the Takata Compulsory Recall Notice and Australian Consumer Law.

The ACCC said it had reasonable grounds to believe that BMG, through its agent Grays, sold a 2003 Nissan Pulsar, which was under active recall and contained a high-risk Alpha airbag.

The ACCC also said it had reasonable grounds to believe HG Innovations, through its agent Grays, supplied a 2005 BMW 3 Series which was under active recall.

The ACCC also separately issued three infringement notices to Grays, totalling $37,800. The ACCC said it had reasonable grounds to believe that Grays had made false or misleading representations by advertising three vehicles for sale that were under active recall: a 2003 Nissan Pulsar, a 2005 BMW 3 Series and a 2002 Honda Jazz.

“We allege that by advertising these vehicles for sale, Grays made false or misleading representations to consumers that the vehicles were of saleable quality, when that was not the case because they were under active recall,” ACCC Deputy Chair Delia Rickard said.

While The ACCC can issue an infringement notice where it has reasonable grounds to believe a person or business has contravened certain consumer protection laws, the payment of infringement notice penalty such as those above is not an admission of a contravention of the Australian Consumer Law.

The various Takata airbag recalls are by far the world’s largest vehicle recall since the faulty and potentially lethal ammonium nitrate-based airbag inflators were first discovered in 2013.

The latest variety of Takata airbag to be discovered as faulty and potentially lethal is the NADI 5-AT inflator airbag, which affects more than 12,000 BMW E46 3 Series vehicles and has caused at least another death in Australia.

More than 80,000 vehicles sold in Australia – mostly produced between 1997 and 2000 – are fitted with NADI 5-AT airbags, many of which are now being bought back from brands including BMW, Audi, Toyota, Mazda and Suzuki.

Despite having a purportedly more stable propellant, the faulty NADI 5-AT employs a 5-Aminotetrazole inflator that may explode in much the same way as the Alpha airbag – or not inflate enough – when deployed.

The global Takata Alpha airbag scandal has claimed at least 29 lives globally, including at least one in Australia, and more than 320 serious injuries due to deterioration in the internal components of the airbags which can blast deadly shrapnel at occupants when the airbags inflate.

About 3.56 million defective Takata airbags have now been replaced as part of the compulsory recall, but more than seven per cent remain outstanding.

Figures released on Friday show about 3.56 million airbags in 2.59 million vehicles were rectified as at the end of 2019, with 299,122 airbags in 256,670 vehicles still outstanding -- about 7.3 per cent.

This excludes 246,768 airbag inflators (6%) in 206,840 vehicles identified as unrepairable (written off, scrapped, stolen, or modified and unable to have the airbag replaced).

“We are now in the final year of the compulsory recall, but more than a quarter of a million dangerous vehicles remain on our roads,” said the ACCC.

As of December 31, 2019, there wee 2611 vehicles with critical-alpha airbags and 8585 vehicles with critical non-alpha airbags as outstanding for replacement.

Vehicles with critical airbags should not be driven and drivers are entitled to have their vehicles towed to a dealership to have the airbag replaced for free (if/when parts are available).

To check if your car is affected, enter your registration plate details here.