The same news is hidden inside CNN
website under the Asian segment. Unlike its previous front page
handling only days ago.
Mattel takes blame for toy recall
BEIJING, China (AP) -- U.S.-based toy giant Mattel issued an
extraordinary apology to China on Friday over the recall of
Chinese-made toys, taking the blame for design flaws and saying it
had recalled more lead-tainted toys than justified.
The gesture by Thomas A. Debrowski, Mattel's executive vice
president for worldwide operations, came in a meeting with Chinese
product safety chief Li Changjiang, at which Li upbraided the
company for maintaining weak safety controls.
"Our reputation has been damaged lately by these recalls,"
Debrowski told Li in a meeting at Li's office at which reporters
were allowed to be present.
"And Mattel takes full responsibility for these recalls and
apologizes personally to you, the Chinese people, and all of our
customers who received the toys," Debrowski said.
The carefully worded apology, delivered with company lawyers
present, underscores China's central role in Mattel's business. The
world's largest toy maker has been in China for 25 years and about
65 percent of its products are made in China.
The fence-mending call came ahead of an expected visit to China by
Mattel's chairman and chief executive, Robert A. Eckert. Following
the massive recall, Eckert told U.S. lawmakers he wanted to see
Mattel's mainland inspections first hand.
Mattel ordered three high-profile recalls this summer involving
more than 21 million Chinese-made toys, including Barbie doll
accessories and toy cars because of concerns about lead paint or
tiny magnets that could be swallowed.
The recalls have prompted complaints from China that manufacturers
were being blamed for design faults introduced by Mattel.
On Friday, Debrowski acknowledged that "vast majority of those
products that were recalled were the result of a design flaw in
Mattel's design, not through a manufacturing flaw in China's
manufacturers."
Lead-tainted toys accounted for only a small percentage of all toys
recalled, he said, adding that: "We understand and appreciate
deeply the issues that this has caused for the reputation of
Chinese manufacturers."
The slew of Chinese-made toys since June by Mattel and other
smaller toy makers has resulted in many parents scouring for
U.S.-made label stamped on playthings at toy stores. That is no
easy feat when more than 80 percent of toys sold in the U.S. are
made in China.
Mattel's mea culpa could help reshape the debate surrounding
Chinese-made toys.
In fact, new research from two business professors shows that
recalls due to problems with the U.S. maker's design accounted for
the vast majority -- about 76 percent -- of the 550 U.S.toy recalls
since 1988.
The report, released earlier this month from Paul R. Beamish, an
international business professor at Canada's University of Western
Ontario, and Hari Bapuji, business professor at University of
Manitoba's I.H. Asper School of Business in Winnipeg, Canada, found
that recalls blamed on design problems and manufacturing defects,
such as lead paint or poor craftmanship, both rose in the past two
years as U.S. makers have shifted more of their production to
China.
But they noted that, "if shifting manufacturing to China resulted
in poorer quality goods, then the number of toys recalled due to
manufacturing should be greater than the number recalled due to
design," the report said. But that is not the case.
"Nobody gets a free ride on this," said Beamish, arguing that toy
makers' obsession to quickly get new products to market before they
are widely copied has resulted in a lot of cost-cutting and
inadequate testing.
In a statement issued by the company Friday, Mattel said its
lead-related recalls were "overly inclusive, including toys that
may not have had lead in paint in excess of the U.S.
standards.
"The follow-up inspections also confirmed that part of the recalled
toys complied with the U.S. standards," the statement said, without
giving specific figures.
The co-owner of the company that supplied the lead-tainted toys to
Mattel, Lee Der Industrial Co. Ltd., committed suicide in August
shortly after the recall was announced.
Li reminded Debrowski that "a large part of your annual profit ...
comes from your factories in China.
"This shows that our cooperation is in the interests of Mattel, and
both parties should value our cooperation. I really hope that
Mattel can learn lessons and gain experience from these incidents,"
Li said, adding that Mattel should "improve their control
measures."
Li, the head of China's General Administration of Quality
Supervision, Inspection and Quarantine, also expressed his
appreciation for Debrowski's "objective and responsible attitude
toward the recent toy recall."
Chinese food, drugs and other products ranging from toothpaste to
seafood are under intense scrutiny because they have been found to
contain potentially deadly substances.
But China has bristled at what it claims is a campaign to discredit
its reputation as an exporter. It accuses foreign media and others
of playing up its product safety issues as a form of
protectionism.
Beijing insists that the vast majority of its exports are safe but
has stepped up inspections of food, drugs and other products in
response to the concerns.
Li told reporters after meeting with Debrowski that the government
had taken swift action against Lee Der, shutting down its
operations and revoking its business license. Four people from the
company also face criminal charges, he said, without giving
details.
Since this summer's recalls Mattel has announced plans to upgrade
its safety system by certifying suppliers and increasing the
frequency of random, unannounced inspections. It has fired several
manufacturers.
Tests had found that lead levels in paint in recalled toys were as
high as 110,000 parts per million, or nearly 200 times higher than
the accepted safety ceiling of 600 parts per million.
Mattel's shares fell from the mid-$23 level following the first
recall in early August, reaching as low as $20.97 on Sept. 10. They
have since rebounded, and rose 55 cents, or 2.33 percent to $24.11
in morning trading Friday..
China has become a center for the world's toy-making industry,
exporting $7.5 billion worth of toys last year.
http://www.cnn.com/2007/US/09/21/mattel.apology.ap/index.html
