Faulty Audi airbags could cost Continental a double-digit million euro amount to fix

Article by Christian A., on November 3, 2014

Continental would have to shell out up to a double-digit million euro amount to fix a defect on its airbags fitted on Audi A4 models. The German carmaker announced in October that it has issued a callback of 850,000 cars globally due to potentially defective software may cause the airbags on the model to fail to deploy.

Continental chief executive Elmar Degenhart has confirmed that his company was the supplier of the system. He said that they have yet to determine what company was to be blamed for the fault. He added that both Audi and Continental are still trying to find out the root of the defect.

Should Continental be faulted for the issue, Degenhart did not give a specific figure for how much a recall could cost the supplier, but placed it between “zero and a double-digit million amount." Degenhart said it was common practice at suppliers and carmakers to allocate funds to pay for potential recalls.

He noted that even if Continental would be found at fault for causing the defect, the cost of the recall would not be enough to change its earnings guidance. Continental updated its full-year profit margin forecast to reflect an increase.

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Topics: audi, airbag, continental

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