Important financial losses for Sony

Aug 26, 2006 12:02 GMT  ·  By

Sony's defective batteries have made this month's headlines and finally became the main problem of every Apple, Dell or HP device user, as the owners could witness 'an official fire hazard' produced by their beloved gadget.

Furthermore, after the reported explosions and the wide-ranging recalls made by Apple and Dell, Qantas Airlines, an Australian based company, decided to ban Sony's batteries from entering in its aircrafts.

But the latest and most threatening event has taken place a few days ago when Japan's trade ministry announced the Sony and also Dell that the two makers should start their own 'research' on what has happened during the mass production of the Lithium Ion batteries and why a high percentage of them ended up in notebooks and other devices. This comes only days after the US Consumer Product Safety Commission initiated its investigation on Sony's malfunctioning batteries.

And today came the company's report on what has happened during mass production and also about the financial losses of the companies which adopted Sony's batteries. "Sony estimates Apple and Dell recall programs alone will cost 20 to 30 billion yen. This translates to approximately $171 to $258 million US dollars. The estimated amount only accounts for Apple and Dell recalls. While Sony doesn't anticipate any further recalls in the future, all Sony notebook batteries are under investigation. This includes batteries used in HP and Lenovo laptops as well," reports Daily Tech.

Moreover, Sony could face another financial disaster if the US Consumer Product Safety Commission's investigation will show that the maker's batteries could endanger the consumers.

"Analysts say that Dell's recall of 4.1 million batteries could cost up to $300 million depending on how many users actually send in their batteries. Lenovo told reporters that it was not recalling any batteries yet and Apple said it would look into the situation. Out of all the manufacturers using batteries from Sony, only Dell has issued a recall. Interestingly, a Sony representative told reporters that Sony believes the problem to be isolated to just Dell," informed Daily Tech.