Ford stops using Takata air bag inflators in future vehicles due to shrapnel risk

Ford Motor Co. will not be using air bag inflators made by Takata Corp. in future vehicles, another blow to the troubled Japanese parts supplier as the auto industry continues to shun its product.

Ford joins Honda, Toyota and Nissan is deciding against putting the inflators in cars, trucks and SUVs now under development.

Takata inflators can explode with too much force, sending shrapnel into drivers and passengers. At least eight people have been killed worldwide and hundreds injured. The inflators have led to the recall of 19.2 million vehicles in the U.S., and government regulators are investigating the possibility of millions more.

Ford has recalled more than 1.5 million older Mustangs, Ford GTs and North American-built Ranger pickups to replace the inflators. Spokeswoman Kelli Felker would not say if other models have Takata inflators, but said the company has recalled all vehicles with inflators that Takata has determined are defective.

Takata uses ammonium nitrate to create a small explosion that inflates the air bags in a crash. But the chemical can deteriorate under prolonged exposure to airborne moisture, causing it to burn too fast and blow apart a metal canister designed to contain the explosion. Ford has decided to stop using inflators powered by ammonium nitrate, Felker said.

Takata has agreed to phase out ammonium nitrate. As part of a deal with the National Highway Traffic Safety Administration, Takata agreed to pay up to $200 million in penalties and speed up replacement of many of the devices already in use.

Takata Corp. reported a half-year loss of 5.6 billion yen ($45.8 million) this month due to recall costs. The company cut its profit forecast for the full year by 75 per cent, reflecting the expense of recalls that affect millions of vehicles globally.

In the U.S., about 23.4 million Takata driver and passenger air bag inflators have been recalled on 19.2 million vehicles sold by 12 auto and truck makers. As of Oct. 9, only 22.5 per cent of the recalled inflators had been replaced nationwide, but the pace is a bit faster in high-humidity states like Florida, which have been given priority.

Repairs have been slowed by the magnitude and complexity of the recalls and by limits to the number of replacement parts that are available.

Three other parts suppliers, Autoliv Inc., Daicel Corp. and ZF TRW Automotive Holdings Corp., are making inflators for Takata-assembled repair modules, and are gaining market share as Takata struggles to cope with the scandal.

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Action for underinsurance coverage dismissed where insured settled Florida action for less than available limits

Action for underinsurance coverage dismissed where insured settled Florida action for less than available limits

Miller Thomson LLP

In a recently reported case, Kovacevic et al. v ING Insurance Company of Canada et al., 2015 ONSC 3415, the court has ruled that an insured may not settle an action for less than the tortfeasor’s available policy limits and then bring an action against their own automobile insurer for underinsurance coverage.

The plaintiffs were injured in a motor vehicle accident which occurred in Florida on February 4, 2004. The plaintiff’s vehicle was struck by a tractor/trailer vehicle. They sued the owner of the tractor and the owner of the trailer. The owner of the tractor failed to defend and was noted in default. The owner of the trailer defended the Florida action. At the time of the accident, the owner of the trailer was insured by Lincoln General Insurance (Lincoln) with a policy limit of $1,000,000.00.  In 2010, the plaintiffs settled the Florida action for $300,000.00 at a private mediation and signed a Full and Final Release in favour of the defendants and Lincoln in the Florida action. The plaintiffs then brought an action for underinsurance coverage against their own automobile insurer, ING, who was not a party in the Florida action and was not notified of the mediation proceedings. The plaintiffs contended that ING was not entitled to a deduction of the Florida tortfeasor’s Lincoln insurance policy limits in the circumstances of this case. The plaintiffs further submitted that the limits of the policy were unavailable in the Florida action as they believed that Lincoln was about to be insolvent at the time of the settlement. ING brought a motion for summary judgment dismissing the action on the basis that the plaintiff was not entitled to settle the Florida claim for less than the available policy limits and then pursue a claim against their own insurer for underinsurance coverage.

The Court considered the following issues:

  1. If the plaintiffs settled their claim against the Florida tortfeasor for less than that tortfeasor’s available insurance policy limits, can they pursue a claim against their own insurer, ING, for underinsured coverage?
  2. In the alternative, if the answer to the first issue is yes, is ING entitled to a deduction of the Florida tortfeasor’s full policy limits of $1,000,000.00 from any award of damages?
  3. Whether summary judgment should be granted in favour of ING on the grounds that there is no genuine issue requiring a trial with respect to the plaintiffs’ claim against ING for underinsured coverage.

ING’s motion for summary judgment was granted. Justice MacKenzie ruled that the plaintiffs were not entitled to settle their claim against the Florida tortfeasors for less than the available policy limits of the Florida tortfeasor’s insurance and then pursue a claim against their own insurer for underinsurance coverage. The plaintiffs were not permitted to rely on a bald allegation that Lincoln was potentially insolvent at the time of the settlement when they did not conduct due diligence to determine whether the policy limits were unavailable when they entered into the settlement. There was no evidence that Lincoln was not solvent at the time of the settlement and therefore, the plaintiffs had failed to prove on a balance of probabilities that the policy limits of the Florida tortfeasor were not available at the time of the settlement.

The case affirms that a party must be diligent with respect to the availability of the tortfeasor’s policy limits during settlement negotiations. Insurers will be pleased with this decision as they should not be expected to compensate for this lack of diligence

Getting a Grip on Canadian Winter Driving

Getting a Grip on Canadian Winter Driving

TORONTO, ONTARIO–Marketwired – New shipment data from the Tire and Rubber Association of Canada (TRAC) suggests tire retailers are gearing up for increased consumer demand for winter tires. These shipment increases are due in part to measures by government, industry and stakeholders to educate drivers about the superior traction and stopping distance of winter tires.

The data is part of a comprehensive new Winter Tire Report released by TRAC to support consumer education efforts by government and industry stakeholders. The report details the latest winter tire shipment, market, usage and test data, along with recommendations to increase winter road safety and build awareness of the benefits of winter tires.

In particular, TRAC reports there has been significant growth in winter tire shipments to dealers, with a 35 per cent increase in Manitoba, a 25 per cent increase in Ontario, and a 14 per cent increase in the Atlanticprovinces.

There are many reasons why tire dealers are ramping up for increased consumer demand for winter tires, but it is no coincidence that it is the provinces who are showing leadership in terms of government programs are also showing the largest increases in winter tire shipments.

  • In Manitoba, the provincial government implemented an innovative low-interest winter tire financing program in 2014 and is continuing the program for the 2015/16 winter.
  • In Ontario, the provincial government recently introduced a mandatory insurance discount program for drivers who use winter tires as part of their initiative to improve road safety and to lower insurance premiums for Ontario drivers.

A 2014 survey conducted by Leger for TRAC, shows that outside of Quebec, where winter tires are the law, only half of Canadian motorists use winter tires. The survey found cost to be a primary deterrent. However, financial incentives offered by government and industry, are proving effective at making winter tires more feasible for many drivers.

“For the safest and very best winter driving experience, we recommend that motorists use winter tires,” says Carolyn Goard, Communications Manager of TRAC. “Government initiatives are working and that’s leading to growing demand and making our roadways safer. As an industry, we will continue to do our part to educate drivers about the importance of using winter tires.”

Other highlights of the report include:

  • Role of government is key. Government leaders are playing a proactive role in encouraging Canadian motorists to use winter tires. Through education and incentives, they are helping to reduce preventable collisions, injuries and fatalities.
  • Easy to recognize labeling. Tires that display the Three-Peak Mountain Snowflake Symbol (also referred to as the ‘Alpine Symbol’) on the sidewall have been rigorously tested and meet specific snow traction performance requirements.
  • Misconceptions persist. While there is a growing understanding from consumers of the safety and performance benefits of winter tires, 63 per cent still cling to the idea that all-season tires offer sufficient traction and braking capabilities for winter driving. Data shows that’s just not true and that winter tires save lives.
  • Temperature is everything with winter tires. At temperatures at or below 7 degrees Celsius, winter tires significantly outperform all others. Winter tires provide superior traction in cold-weather because they feature a softer tread compounds that maintain flexibility.
  • Provincial governments are doing their part. Government jurisdictions across Canada are proactively promoting road safety in the winter. Consumer education resources, financial incentives – among other initiatives – are helping to increase winter tire adoption nation-wide.

The full 2015 TRAC Winter Tire Report, along with a wide range of winter tires resources, can be viewed by visiting news.tracanada.ca/winter-tires

New partnership aims to reduce distracted driving in Canada

Cooperators-logo-blue-2X

GUELPH, ON and OTTAWA, Nov. 18, 2015 /CNW/ – Research suggests that distracted driving is a substantial factor in road fatalities, and may be equal to or even exceed impaired driving in at least some jurisdictions in Canada. As part of its Drive out Distraction program, The Co-operators today announced a new partnership with the Canadian Traffic Injury Research Foundation (TIRF) aimed at reducing the incidence of distracted driving in Canada. The announcement was made today, the National Day of Remembrance for Road Crash Victims.

TIRF is a national, independent road safety research institute that focuses on identifying the causes of road crashes and developing programs and policies to address them effectively. Through this partnership, The Co-operators will support TIRF’s research and educational work focused on reducing distracted driving. This will include the creation of a public online repository of data, information and resources that can serve as an easily accessible tool for stakeholders and others with an interest in the issue. In addition, a multi-stakeholder working group will be created, which will develop a national evidence-informed, comprehensive action plan to combat distracted driving in 2016.

“As an insurer of more than one million vehicles, we see first-hand the devastating effects of traffic injuries and fatalities on the lives of our clients,” said Kathy Bardswick, president and CEO of The Co-operators. “Distracted driving is a contributing factor in one of every four major injury crashes. We are determined to make a difference by working to change behaviour around distracted driving to make our roads and communities safer for everyone.”

In the coming weeks, as part of the partnership, an environmental scan report on efforts to combat distracted driving will be published. The research conducted by TIRF, in partnership with Drop It And Drive (D.I.A.D.) will track and benchmark legislative, policy, enforcement, educational and advocacy efforts in jurisdictions across Canada to establish a solid foundation on which future initiatives could be planned and coordinated across organizations.

“In the past decade, our understanding of distracted driving has grown immensely, and governments and agencies have responded and undertaken work on several fronts to implement a comprehensive approach to tackle it,” said Robyn Robertson, president and CEO of TIRF. “It’s equally important that we leverage the experiences and knowledge gained, not only strengthen programs and policies, but also to find better ways to coordinate the wide-ranging activities underway, and become more efficient as well as effective.”

The partnership with TIRF is part of the Drive out Distraction program, The Co-operators ongoing commitment to make Canadian roads safer. Earlier this year, the organization announced its support for OneTap, a breakthrough new smartphone app developed by AppColony that promotes distraction-free driving.

About the Traffic Injury Research Foundation:
The mission of the Traffic Injury Research Foundation (TIRF) is to reduce traffic-related deaths and injuries. TIRF is an independent, charitable road safety research institute. Since its inception in 1964, TIRF has become internationally recognized for its accomplishments in identifying the causes of road crashes and developing programs and policies to address them effectively.

About The Co-operators:
The Co-operators Group Limited is a Canadian-owned co-operative with more than $40 billion in assets under administration. Through its group of companies it offers home, auto, life, group, travel, commercial and farm insurance, as well as investment products. The Co-operators is well known for its community involvement and its commitment to sustainability. The Co-operators is listed among the 50 Best Employers in Canada by Aon Hewitt; Corporate Knights’ Best 50 Corporate Citizens in Canada; and the Top 50 Socially Responsible Corporations in Canada by Sustainalytics and Maclean’s magazine. For more information visit www.cooperators.ca.

SOURCE The Co-operators

In a statement Monday, Uber said a petition supporting the company has nearly 15,000 signatures.

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Questions raised about General Motors, government action in recall over thousands of car fires

By Tom Krisher And Dee-Ann Durbin

THE ASSOCIATED PRESS

DETROIT – Shortly after Elizabeth Berry parked her bright yellow 2003 Chevrolet Monte Carlo SS on the street in front of her family’s home in May 2014, flames engulfed the engine, destroying the car and scorching her mailbox.

“I was hysterical. That was like my third baby,” she says of the car.

Compounding the shock was the fact that five years earlier, Berry had answered a recall notice from General Motors for a repair that was supposed to prevent engine fires.

Two weeks ago, Berry learned that she is one of 1,345 car owners in towns across the U.S. whose cars caught fire even after getting the repair called for in the recall. GM acknowledged the fix didn’t work and issued a new recall involving 1.4 million older cars, some for a second time.

GM advised drivers to park the cars outside until the repairs are done, for fear of flames spreading to nearby structures.

The post-recall fires raise questions about whether GM should have acted sooner, whether the government should have taken notice and stepped in, and whether the ineffective fix should have been approved in the first place.

After a series of mishandled recalls that involved deaths and injuries, criminal investigations, class-action lawsuits and costs running into the billions of dollars, the auto industry has improved its spotting and reporting of safety troubles. Over the past two years, automakers have recalled about 100 million cars and trucks in an effort to clean up lingering safety issues and catch new ones before they escalate to millions of vehicles. Of GM’s 41 recalls this year, the company says about half cover fewer than 10,000 cars or trucks.

But cases such as the GM fires, and the government’s recent punishment of Fiat Chrysler for numerous delayed recalls show that an old culture of resistance and procrastination can still haunt the industry and car owners. It also shows that despite reforms that have made the National Highway Traffic Safety Administration more aggressive, problems can still go undetected.

“Over 1,000 fires is a huge number that should have generated a safety recall by GM before now,” says Clarence Ditlow, head of the non-profit Center for Auto Safety, a watchdog group. “To make matters worse, NHTSA missed the defect in its complaint database.”

Problems with the cars, including the Monte Carlo, Pontiac Grand Prix, Chevy Lumina and Impala, Buick Regal and Oldsmobile Intrigue from the 1997 to 2004 model years, surfaced as early as 2006. In one North Carolina case, flames spread from a Pontiac and damaged two houses. Overall, GM has reported 19 minor injuries and at least 17 structure fires.

The problem: oil seeping through valve cover gaskets designed to keep it inside the engine. The gaskets can deteriorate over time, and inertia from hard braking can cause oil to drip onto the hot exhaust manifold on the 3.8-litre V6 engines, where it could ignite.

In 2008 and 2009, GM issued separate recalls for two versions of the V6, covering 1.7 million cars. In some cars the gasket was replaced, but in the majority, only flammable plastic parts near the manifold were replaced.

GM spokesman Alan Adler said two weeks ago that if any oil dripped and caught fire, it would cause a small “pilot flame,” that company tests showed would burn out on its own. “We were trying to remove anything that would allow the flame to spread,” he said.

But Jake Fisher, a former GM engineer who now is Consumer Reports’ director of auto testing, says the recall should have addressed the oil leak on all the cars. He was surprised GM would allow an open flame under the hood. “I can’t imagine a scenario where that would be acceptable,” he says.

Erik Gordon, a lawyer and University of Michigan business professor, says the decision not to fix the leak shows that GM’s culture was to find the cheapest, easiest repair. “This is a ‘we’ll get out the duct tape’ kind of approach,” he says. “We’re not going to replace the gaskets because that’s too expensive.”

Valve cover gaskets are relatively cheap, but the labour to do the repairs is where the cost lies. It takes about 48 minutes to replace the gasket and do the other recall repairs, according to documents. At a labour rate of around $100 per hour, fixing 1.4 million cars would cost GM roughly $112 million.

It’s unclear why NHTSA didn’t act sooner or whether GM could be fined for not reporting the post-recall fires faster. NHTSA spokesman Gordon Trowbridge wouldn’t comment on either issue. Automakers are required by law to report safety defects within five days of discovery.

A review by The Associated Press of NHTSA’s complaint data on just one model, the 2001 Grand Prix, shows 466 complaints of engine fires, including 33 concerning fires after recall repairs were made. Complaints of fires on recall-repaired cars started in June of 2009, more than six years ago.

Elizabeth Berry says that after her Monte Carlo burned last year she called GM and a representative told her that recall repairs hadn’t fixed the problem. She says GM offered her $2,000 and asked her not to have the car towed or to contact insurance. But her insurance company offered her four times more, so she took that offer and bought a Mazda6.

The fires are still occurring. On Sept. 9, freshman Joe Jarmoluk’s white 2004 Grand Prix caught fire after he left it in a parking lot at Grand Valley State University near Grand Rapids, Michigan. By the time the fire was out, the car was totalled. It damaged four nearby vehicles, melting tires, a bumper and a tail light.

Other drivers, Jarmoluk says, were mad at him, with one complaining he’d been left stranded by the fire. Jarmoluk had to buy a new car, and GM has turned down his claim for compensation.

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