Why It’s So Hard to Crack Down on Deadly Counterfeit Air-Bag Parts

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Alex Ossola (0:34)

Continued exchanges of fire with Iran could put the U.S.'s energy security at risk.

And why it's so difficult to crack down on airbags with counterfeit parts that have killed at least 10 people. Plus the Manhattan high-rise scare is a reality check moment for developers.

Rebecca Picciotto (0:50)

Ultimately, there's a question on are lenders and investors going to have to reprice the risk of doing an office-to-residential conversion.

Alex Ossola (0:59)

It's Thursday, July 9th. I'm Alex Ossola for The Wall Street Journal. This is the PM Edition of What's News, the top headlines and business stories that move the world today.

We're going to be talking about the real estate industry later on today's show. But first, a bit of data on the housing market. The spring selling season has ended and it wasn't great. The National Association of Realtors said today that US existing home sales fell 2.4% in June, worse than expected. Economists have dimmed their projections for the year. That's because of higher mortgage rates and record home prices.

The Federal Reserve has named more than a dozen external advisors to lead five task forces that will examine the central bank's operations. The picks are mainly academics, but there's also the former CEO of Walmart, Doug McMillan, and venture capitalist Mark Andreessen, who's a big supporter of the Trump administration. The task forces are part of a reform effort from Fed Chairman, Kevin Warsh. They'll look at the Fed's approach to the jobs market, inflation, economic data, the Fed's bond portfolio, and how it handles communications with the public.

Turning to the auto industry, a federal safety regulator is warning that robo-taxis are a danger to the public because there are times when they drive into active emergency scenes and they block the way for ambulances and firefighters. The National Highway Traffic Safety Administration says that cars also haven't been able to recognize traffic cones, flashing lights and other safety threats like smoke and fire. The robo-taxi industry is active in Texas, California, Arizona and other states. Alphabet-owned Waymo has become the early leader. The traffic safety regulator says the industry has the potential to reduce traffic fatalities, but the agency also says that cars need to be held to the same standard as human drivers when they're dealing with law enforcement. The agency is setting up meetings with the companies to hear their solutions. Waymo and Tesla say their vehicles are designed to respond to emergency responders.

There's no doubt that airbags and cars have saved tens of thousands of lives. But sometimes they're also dangerous. The latest problem, airbags with counterfeit parts that are marked as being made by a company from China. Federal safety officials have known about these for a while, and they've tied the dangerous part to at least 10 deaths in the US since 2023 Now, they're trying to stop more drivers from being killed or injured. Journal Autos reporter Ryan Felton has been digging into this, and he says it's a pretty narrow segment of vehicles that are affected.

Ryan Felton (3:26)

If your car has been in an accident, severe enough to cause airbags to deploy, that's really the key category of vehicles that could be at risk, because to safely get back on the road, people want to have the airbags that are functioning.

Alex Ossola (3:41)

The issue comes from airbag parts that appear to originate from a Chinese manufacturer known as DTN airbag.

Often, mechanics and dealerships will buy these replacement airbags from sites like eBay and Facebook Marketplace. And sometimes they're even labeled with counterfeit logos of American car makers. Ryan says this complicated market makes it a lot more difficult for regulators to crack down on the dangerous parts.

Ryan Felton (4:03)

This isn't tracked diligently like the way that new car parts or authenticated parts are tracked. So regulators and investigators have to really do some forensic digging to figure out like who brought these in, who sold them, what person bought the car and who installed this airbag. It gets unwieldy pretty fast with every single incident.

And that's kind of just been the key challenge. DTN itself has claimed that it believes the products themselves that are being found in these airbags here aren't actually their own and were counterfeited of their own products. And so regulators took that point into consideration.