Dell will recall PC (4.1 million) batteries

Dell will recall PC batteries
By Damon Darlin
Copyright by The New York Times
Published: August 14, 2006


Dell is recalling 4.1 million notebook computer batteries because they could erupt in flames, the company said Monday. It will be the largest safety recall in the history of the consumer electronics industry, the Consumer Product Safety Commission said.

Dell, the world's largest PC maker, said the lithium-ion batteries were made by Sony and were installed in notebooks sold from April 2004 to July 18 of this year.

The recall raises broader questions about lithium-ion batteries, which are used in devices like cellphones, portable power tools, camcorders, digital cameras and MP3 players. The potential for such batteries to catch fire has been acknowledged for years, and has prompted more limited recalls in the past. But a number of recent fires involving notebook computers, some aboard planes, have brought renewed scrutiny.

Dell has reported to the safety agency that it documented six instances since December in which notebooks overheated or caught on fire. None of the incidents caused injuries or death. Dell said the problems were a result of a manufacturing defect in batteries made by Sony.

The safety agency said the batteries' problems were not unique to Dell, meaning that other companies using Sony batteries might also have to issue recalls. Sony has sold its batteries to most of the major computer makers.

The recalled batteries were used in 2.7 million Dell computers sold in the United States and 1.4 million sold overseas. The total is about 18 percent of Dell's notebook production during the period in question.

Depending on how many of the batteries are still in use, the cost of the recall could exceed $300 million. Dell refused to estimate the cost, but said the recall would not materially affect its profits. Sony, which affirmed yesterday that its batteries were responsible, said it was "financially supporting" Dell in the recall.

Dell said it would notify affected customers by mail and online, or through corporate sales representatives, and arrange to send a replacement battery. In the meantime, it advised owners to remove the original battery and use a power cord.
The largest previous safety recall of a consumer electronics product, in October 2004, involved a million lithium-ion batteries for Kyocera cellphones.

Dell has been bedeviled by reports of burning laptops in recent months. In June, a Dell notebook burst into flames during a conference in a hotel in Osaka, Japan. In that case, an analysis showed the fire was probably caused by microscopic metal particles produced during the manufacturing process. In July, firefighters in Vernon Hills, Ill., were called to an office of Tetra Pak, the food processing and packaging company, to extinguish a notebook fire hot enough to burn the desk beneath it.
That same month, a Dell notebook in the cab of a pickup parked alongside Lake Mead in Nevada caught fire, igniting ammunition in the glove box and then the gas tanks. The truck exploded. "A few minutes later and we'd have been coming up out of the canyon when the notebook blew up," said Thomas Forqueran, owner of the computer and truck. "Somebody is going to wind up getting killed."

The battery problem is the latest setback for Dell, long a highflier on Wall Street. Faced with stiffer competition that has forced price cuts, it has reported lower-than-expected sales and earnings over the last year, sending its stock down more than 40 percent. It is spending $100 million to improve its customer service, which it found had alienated consumers.
Dell executives hope the recall, while vast, will prevent further damage to its image. "We're getting ahead of the issue," said Alex Gruzen, senior vice president and general manager of the product group at the company. "I don't want any further incidents to take place." Other computer makers that use Sony batteries were taking stock yesterday of their possible exposure to similar problems.

An Apple spokeswoman, Lynn Fox, said, "We are currently investigating whether batteries that have been supplied to Apple for our current and previous notebook lines meet our high standards for battery safety and performance." A Hewlett-Packard spokesman said the company's notebooks would not be affected by the recall because its batteries were designed specifically for its products.

A Lenovo spokesman, Robert Page, said, "To date, we have not seen any unusual pattern or problems with notebook PC's." The company said its batteries were designed differently from those used by Dell. "Not all notebook batteries are the same," Page said.

Lithium-ion batteries pack more energy in a smaller space than other types of batteries. They are the cheapest form of battery chemistry and are increasingly being used in more types of consumer products.

What that means, said Richard Stern, associate director of fuel, electrical and recreational products at the product safety commission, is "more batteries, more likelihood for quality-control problems and for design problems and so we'd expect more incidents and more recalls of these batteries." The federal safety agency has negotiated 10 recalls of lithium-ion batteries used in notebook computers since 2000 and another 12 battery recalls for other electronic products, including a Disney-brand children's DVD player.

Federal regulations require that lithium-ion batteries be clearly marked with warnings when they are shipped in bulk on airplanes, and various agencies are considering more stringent regulations after a fire that was detected as a United Parcel Service cargo plane began its descent into Philadelphia in February. Though a cause of that fire, which consumed and destroyed the plane after it landed, has not been determined, lithium-ion batteries are suspected. No one was hurt.
A single battery also caught fire in the overhead luggage bin of a Lufthansa passenger jet about to depart from O'Hare International Airport in Chicago in May. A flight engineer tossed it to the tarmac, where the fire was extinguished. (Neither of the incidents resulted in injuries, nor are they said to involve Dell computers or Sony batteries.) The Federal Aviation Administration lists three other incidents involving burning lithium-ion batteries on cargo and passenger planes since 2004.
The portable battery industry has said there is not a broad problem with lithium-ion battery fires. But makers have known of the ability of lithium-ion batteries to catch fire since its first commercial use in 1991. In 1995, a Sony lithium-ion battery factory in Koriyama, Japan, was partly destroyed when a battery undergoing a quality test caught fire.

The current recall also leaves many questions unanswered on how Dell, as well as the product safety commission, deals with information about fire-damaged notebooks. Although Dell told the agency that only six incidents had occurred, a reporter viewed almost 100 photos of melted notebooks that were returned to the company between 2002 and 2004.

The photos, from a Dell database, were supplied by a former Dell technician, Robert Day, who said such damage "was more of a common thing than they are letting on." As many as several hundred a year were returned. Day said, "I did see so many pallets of stuff coming in that they had to use my lab for overflow storage."

But David Lear, the director of environmental affairs and product safety at Dell, said most of the damage to those notebooks was unrelated to battery issues. "Ninety-nine percent of the time they are not safety issues," he said.

Dell officials refused to say how many computers had been returned because of heat or fire damage, but said the company had acted on the problem as soon as it realized there might be a pattern. Gruzen said the publicity surrounding the notebook fire at the Osaka hotel did not prompt Dell to look into the problem, because the company was already having conversations with Sony.

But the Osaka incident focused the company's attention on the possibility that the fires might be a more widespread problem than originally thought. "It's not that six was the magic number; we just didn't have enough material," Lear said. Given the number of computers that Dell sells, even several hundred incidents a year is statistically minuscule, about one in several hundred thousand computers. "We are talking about triangulating on very sparse data," Gruzen said.

A member of Lear's staff, who happened to be in Japan at the time of the notebook fire, retrieved the damaged computer. It was taken to a Los Angeles area lab of Exponent, a failure-analysis firm, for examination.

The unit worked when it was plugged in to the power cord, despite the fire, which told the investigators that the problem was not with any circuitry or microchips. An X-ray of the battery pack told them the fire was not caused by an overcharged battery, because a safety device was still intact.

Rather, Dell said the cause of the fire was a short circuit in one of the fuel cells. It was caused by microscopic metal particles that contaminated the electrolyte. Dell thinks that the particles were released when the case of the cell was crimped near the end of Sony's manufacturing process. It was the same problem associated with the 22,000 notebooks that Dell recalled in December.

Sony technicians, who took part in the examination at the Exponent lab, looked at additional data on all its batteries, not just those sold to Dell, that suggested a problem in the manufacturing process. "As events trickled in, they seemed to reinforce a conclusion that these Sony cells had an issue," Gruzen said. "They don't show a predictable pattern, which is why we wanted to get them out of the marketplace." Sony is the second-largest maker of lithium-ion batteries for notebooks, after Sanyo.
The new Dell batteries, which the company hopes to distribute over the next four weeks, will be made by Sony and other vendors. Dell said it was confident that Sony had solved the problem by changing part of its manufacturing methods.
"We are absolutely confident that when we replace the batteries that we are getting the at-risk batteries out of consumers' hands and that there will be no more incidents," Gruzen said.