Sony Details Notebook Battery Recall Program - InformationWeek
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10/25/2006
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Sony Details Notebook Battery Recall Program

Sony laid out plans for recalling 9.6 million units from Dell, Apple, and Lenovo.

TOKYO — Sony Corp. has announced the details of its global voluntary replacement program for lithium ion notebook batteries, hoping to close the book on a nightmare chapter that analysts said would do inevitable damage to Sony's battery market share.

The announcement, made Wednesday (Oct. 25), elaborated on the battery-exchange notice the company issued in late September. Sony will replace total 9.6 million battery packs that contain certain 2.4 ampere-hour and 2.6-A-hr cells manufactured during the period from August 2003 to February 2006. The 9.6 million units include battery packs currently under recall by Dell, Apple Computer and Lenovo. The program will be implemented in cooperation with the U.S. Consumer Product Safety Commission and other regulatory agencies worldwide.

Yutaka Nakagawa, executive deputy president of Sony, said the combination of certain systems and cells had resulted in certain battery packs' overheating, smoking or catching fire, though he said the cause of the battery-related problems in Lenovo PCs had not been pinpointed. "We decided on our voluntary global battery replacement program to eliminate any remaining concerns or needs of our customers and consumers. With this program, all safety measures will have been completed, and we hope to put an end to this trouble," Nakagawa said.

Sony estimates the cost of the recall at 51 billion¥ (about $429 million). Nakagawa admitted that Sony alone cannot supply all the batteries to be replaced and that the company is negotiating with other battery manufacturers for supply.

Sony was the first manufacturer to commercialize the lithium ion battery in its present form. But in 2005, Sanyo was the top supplier, with a 27 percent share, followed by Sony with 12 percent, Matsushita with 11 percent and Samsung with 10 percent, according to J-Star Global, Inc., a Tokyo-based market research firm.

"This battery trouble will inevitably lower Sony's share, to the benefit of Sanyo and Matsushita, and probably Korean and Chinese manufacturers as well that are rapidly catching up with the Japanese vendors," said Yoshihisa Toyosaki, president of J-Star.

Toyosaki noted that "the cause of the trouble has not been fully identified" but added that if contamination from metal particles is found to be a culprit, "there was similar trouble with batteries for mobile phones in 2000. This would mean that the quality control measures have not been sufficient."

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