August 25, 2006 in Business

Apple recalls laptop batteries

Rachel Konrad Associated Press

Affected models

Apple’s recall covers 1.1 million rechargeable batteries in the 12-inch iBook G4, 12-inch PowerBook G4 and 15-inch PowerBook G4 laptops sold in the United States from October 2003 through August 2006. The recall also covers 700,000 batteries in laptops sold abroad.

SAN FRANCISCO – Ten days after Dell’s record-setting notebook battery recall, Apple Computer Inc. told its customers Thursday to return 1.8 million batteries that could cause their Mac laptops to overheat and catch fire.

Both recalls involve lithium-ion batteries made by a Sony Corp. subsidiary in Japan, where the manufacturing process introduced metal particles into battery cells. Makers of battery cells strive to minimize or eliminate the presence of such particles, which can cause computers to short circuit, or, in extreme situations, catch fire.

In its recall announcement, Apple said it has received nine reports of lithium-ion battery packs overheating, including two cases in which users suffered minor burns and some involving minor property damage. The Apple recall only applies to older notebooks – not the just-released MacBooks and MacBook Pros.

On Aug. 14, Dell Inc. recalled 4.1 million faulty laptop batteries – the largest recall involving electronics in the history of the U.S. Consumer Product Safety Commission.

Sony Energy Devices Corp. said the Dell and Apple batteries were configured in slightly different ways. In a statement, Sony said the problems arise “on rare occasions” when microscopic metal particles hit other parts of the battery cell and lead to a short circuit.

Sony said the recalls will cost it between $172 million and $278 million. Apple spokesman Steve Dowling said its recall was not expected to materially affect the company’s results. Dell has said the recall would not affect earnings.

Apple shares closed Thursday at $67.81, up 50 cents. Dell shares closed at $21.78, up 14 cents.

Spokespeople at other large computer makers, including Hewlett-Packard Co., Gateway Inc. and Lenovo Group, the Chinese computer maker that bought IBM’s PC business, said Thursday they did not expect to have problems with their batteries.

Although Lenovo uses Sony batteries, Lenovo engineers configured their battery packs differently from Dell or Apple. They also rigorously tested the battery packs with Sony engineers, and they’re “highly confident” the laptops aren’t going to overheat.

“Lenovo designs its battery packages a different way,” said Lenovo spokesman Bob Page. “How close the battery pack is it to a heat source, how evenly can you keep the heat in battery cells, the basic geometric arrangement of the cell – all those things affect whether there will be problems.”

Analyst Tim Bajarin of Creative Strategies said investors wouldn’t likely blame or punish Apple for the battery recall.

“When you view Apple, you’ve really got to see a company that’s doing well on all levels of products,” he said. “You’ve really got to judge them on the whole. Like with any company, you might have a hiccup here and there. What I really would have had a problem with was if they had covered it up.”

Consumers may have a different opinion about whether the Cupertino, Calif.-based electronics maker is at fault in the recall.

For years, the electronics industry has been aware that lithium-ion batteries could short-circuit when subjected to the fierce power consumption demands of laptop computers. In May 2005, Apple recalled 128,000 laptop batteries made by LG Chem Ltd. of South Korea because of overheating problems.

But the newest recall is much more far-reaching. The Dell recall affects less than 20 percent of the Dell laptops sold at the time, whereas the Apple recall affects more than 30 percent of the total number of laptops Apple sold in the period affected by the recall, according to IDC analyst Richard Shim.

The fact that Dell volunteered to recall its laptops nearly two weeks before Apple’s recall could harm Apple’s image as consumer-friendly and proactive in the face of problems, said Chris Le Tocq, an analyst with Guernsey Research.

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