Sony on defensive over Dell notebook debacle

The infamous case of the exploding Dell notebook is having major repercussions for battery manufacturer Sony and its vendor partners.

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By  Michael Thorne Published  September 6, 2006

|~|dell200.gif|~|Michael Dell, chairman of Dell Corporation claims the company’s full-year financial results will not be adversely affected by the battery recall.|~|Consumer electronics giant Sony has denied that the recall of its laptop batteries by both Dell and Apple will impact owners of its own notebooks or other vendor partners. Dell recently issued a worldwide recall of around 4.1 million notebook batteries made by Sony because of the potential fire risk that they pose, warning people found to have faulty batteries to stop using them immediately. Apple followed suit in the last week of August, issuing a recall of 1.8 million Sony manufactured notebook batteries, 700,000 of which were originally sold outside the United States. Sony however claims that the batteries do not pose a fire hazard in its own range of Vaio notebooks and that other vendor partners will not be affected. “We supplied the same types of batteries to other companies, but because of differences in computer systems, we don’t believe similar issues will arise in their case,” says a Middle East spokesperson. “A select number of VAIO PCs sold in limited quantities utilised the same type of battery cells called to attention in recent announcements. “While the potential for overheating can be affected by variations in notebook system configurations, we do not believe that Sony VAIO PCs have this potential and we are not aware of any issues of overheating related to these products.” Sony confirmed that it would be offering compensation to both Dell and Apple in light of the recent recall. “We currently estimate that the overall cost to Sony of supporting the recent recalls by Apple and Dell will range somewhere between US$171 million and US$257 million,” Sony Gulf confirmed. “This estimate includes, but is not limited to, the ongoing costs associated with providing replacement battery packs.” The Dell recall is the largest in the company’s 22-year history, dwarfing the 35,000 batteries the vendor recalled in December last year for the same reason. In June, a Dell notebook was captured on a mobile phone camera exploding into flames at a conference in Osaka, Japan. Since then, two more cases involving Dell laptops catching fire have been reported in the media. The company’s founder and board chairman, Michael Dell, recently stated that he did not expect the recall to have “any material impact on [Dell’s] finances.” He added that any losses incurred would represent “a non-material amount”. “We have been working very closely with Sony to understand what occurred in the process during the period of contamination and also to understand what counter-measures they have taken,” he says. “We have confidence that they have taken the right counter-measures and that their process is now secure. So we expect that Sony will continue to be a good supplier of batteries for us.” A Sony Gulf spokesperson claims the company has introduced a number of additional safeguards into its battery manufacturing processes that are designed to ensure the batteries are reliable and safe to use in all typical environmental conditions. In announcing the recall, Dell, the largest PC maker in the world, said its Latitude, Inspiron, Precision and XPS units were all affected and owners of these models should check the company’s website to determine whether their notebook had a defective battery. “There is a recommendation that customers go onto the website and verify whether they have a unit that is impacted and until such time as they have verified whether in fact it is or is not it is recommended they go to A/C power,” says Dave Brooke, marketing manager for Dell Middle East. “If a customer finds that they are impacted then they should stop using the battery immediately.” Brooke says that around one million of the estimated 4.2 million affected Dell notebooks were sold in the Europe, Middle East and Africa (EMEA) regions, and of that an estimated 20,000 were shipped to the Middle East region. Dell concedes it has so far received six reports of overheating notebooks that ultimately caused property damage, but no injuries. Brooke says none of these incidents occurred in the Middle East. A spokesperson for Apple’s independent marketing company in the Middle East, Arab Business Machines (ABM), says Apple has yet to ascertain how many, if any, affected components are in use in the Middle East. However, he did confirm the affected batteries were sold between October 2003 and August of this year, and were employed in Apple’s 12-inch iBook G4, 12-inch PowerBook G4 and 15-inch PowerBook G4. According to Apple, the company has received nine reports of batteries overheating, with two users reporting minor burns and property damage. ABM is advising Apple customers in the Middle East who suspect they may have affected batteries to contact their local Apple authorised reseller. Dell, Apple and other PC manufacturers plan to meet this month to discuss setting design and safety standards for lithium-ion batteries used in portable electronic devices. The meeting, which was organised before the announcement of the Dell battery recall, will be staged in conjunction with electronics industry trade group IPC, which sets standards for a number of electronics components. Its critical components committee will meet this month in San Jose, California. Dell executive John Grosso, who heads the committee, says standardisation will be the best way to address the safety issues raised by the recent recall. “While the committee had identified lithium ion batteries as the next product for standardisation [before the recall], we are now going to accelerate our activities,” he says.||**||

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