Sedgwick: U.S. Product Recalls Dropped in Q2 in 5 Key Industries

Product recalls in the U.S. decreased across the automotive, consumer product, food and drink, medical device and pharmaceutical industries in the second quarter, a new report shows.

A report from Sedgwick shows the 788 recalls across those industries represent a 13.3% decrease from Q1 2024.

However, the number of defective units increased from 129.6 million in Q1 2024 to 254.6 million in Q2 2024 across the five industries—the second-highest quarterly total in the past nine quarters, the Sedgwick report shows.

The report shows the number of automotive recalls fell 7.3% in Q2 2024 from Q1 2024.

Q2 recalls marked the second-lowest quarter for units impacted in over 10 years, with a total of 5 million vehicles recalled in Q2 2024.

Looking Ahead

Automotive: The EPA issued final rules to establish emission standards for the automotive industry in early Q2, but when the Supreme Court struck down the Chevron Doctrine, the ability of agencies to take the lead in interpreting vague legislation could be severely impacted. EVs also remain a focus for regulators.

Consumer Product: The FTC continues to pursue “Made in USA” violations, while the Department of Justice is seeking criminal charges against two executives who failed to comply with the Consumer Product Safety Act. Artificial intelligence and child safety will continue to top regulator priorities.

Food and Beverage: The FDA received final approval on its proposed reorganization plan to create a unified Human Foods Program in May. This will be a focus for the agency.

Pharmaceutical: Regulators have been focused on marijuana, cannabis and menthol cigarettes. Even as lawmakers work to reschedule marijuana, they are denying a regulatory path forward for products derived from cannabis. The FDA is also under pressure from advocacy groups to ban menthol cigarettes.

Medical Device: Enforcement activity is on the rise, with the DOJ announcing two major settlements concerning device manufacturers in the second quarter. Manufacturers should be aware that agencies are willing to pursue not only civil, but also criminal penalties for non-compliance.

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Equipment was the most dominant cause of automotive recalls in Q2 2024.

Equipment was linked to 42 events. Electrical systems were the second-most common concern, cited in 38 recalls. Steering was third with 20 events.

Back-over prevention systems were the most common reason for automotive recalls by volume, with 1.66 million units impacted across 12 events, according to Sedgwick.

Increased tariffs for Chinese imports are also playing a major role in the auto industry. Tariffs on steel and aluminum products are set to increase from 0%-7.5% to 25% in 2024 and the tariff rate on semiconductors will increase from 25% to 50% by 2025.

Consumer product recalls fell 6.5% to 86 in Q2 2024, while the number of defective units rose by 67.3%, from 23.4 million in Q1 to 39.1 million in Q2, according to the report.

Sports & recreation accounted for the most recalls by product category in Q2 2024, with 25 events. Home furnishings and décor was second with 13 recalls, and children’s products was third with nine events.

Toys lead categories by volume of recalls, with 22.01 million units affected, due mostly to a hazardous material risk from liquid resin.

Personal care products saw 8.46 million units recalled, the second highest by volume—8.26 million were for packaging of liquid laundry detergent that were subject to leaking, posing a risk to children.

Electronics was the third-highest product category in Q2 with 3.91 million units recalled.

There were two electronic related events involving more than one million units: a garment steamer (1.60 million units), and rechargeable lights (1.24 million units), the report shows.

Recalls in the food and drink industry fell by 11.9%, and total units recalled fell by 68.5% compared to the first quarter. The leading cause of recalls were unstated allergens, according to the report.

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There were 196.2 million defective units in the medical device industry in Q2, a 267.3% increase from Q1 2024. In contrast, the number of recalls fell from 296 in Q1 to 242 in Q2.

Recalls in the pharmaceutical industry fell from 112 in Q1 2024 to 93 in Q2. The number of defective units fell 51.2% to 4.5 million in Q2. Roughly 173 different companies were involved in medical device recalls for Q2, the report shows.