September 22, 2007 in Business

Mattel apologizes to Chinese

Associated Press The Spokesman-Review

BEIJING — U.S.-based toy giant Mattel Inc. issued an extraordinary apology to China on Friday over the recall of Chinese-made toys, taking the blame for design flaws and saying it had recalled more lead-tainted toys than justified.

The gesture by Thomas A. Debrowski, Mattel’s executive vice president for worldwide operations, came in a meeting with Chinese product safety chief Li Changjiang, at which Li upbraided the company for maintaining weak safety controls.

“Our reputation has been damaged lately by these recalls,” Debrowski told Li in a meeting at Li’s office at which reporters were allowed to be present.

“And Mattel takes full responsibility for these recalls and apologizes personally to you, the Chinese people, and all of our customers who received the toys,” Debrowski said.

The carefully worded apology, delivered with company lawyers present, underscores China’s central role in Mattel’s business. The world’s largest toy maker has been in China for 25 years and about 65 percent of its products are made in China.

The fence-mending call came ahead of an expected visit to China by Mattel’s chairman and chief executive, Robert A. Eckert. Following the massive recall, Eckert told U.S. lawmakers he wanted to see Mattel’s mainland inspections first hand.

Mattel ordered three high-profile recalls this summer involving more than 21 million Chinese-made toys, including Barbie doll accessories and toy cars because of concerns about lead paint or tiny magnets that could be swallowed.

The recalls have prompted complaints from China that manufacturers were being blamed for design faults introduced by Mattel.

On Friday, Debrowski acknowledged that “vast majority of those products that were recalled were the result of a design flaw in Mattel’s design, not through a manufacturing flaw in China’s manufacturers.”

Lead-tainted toys accounted for only a small percentage of all toys recalled, he said, adding that: “We understand and appreciate deeply the issues that this has caused for the reputation of Chinese manufacturers.”

The slew of Chinese-made toys since June by Mattel and other smaller toy makers has resulted in many parents scouring for U.S.-made label stamped on playthings at toy stores. That is no easy feat when more than 80 percent of toys sold in the U.S. are made in China.

Mattel’s mea culpa could help reshape the debate surrounding Chinese-made toys.

In fact, new research from two business professors shows that recalls due to problems with the U.S. maker’s design accounted for the vast majority — about 76 percent — of the 550 U.S.toy recalls since 1988.

The report, released earlier this month from Paul R. Beamish, an international business professor at Canada’s University of Western Ontario, and Hari Bapuji, business professor at University of Manitoba’s I.H. Asper School of Business in Winnipeg, Canada, found that recalls blamed on design problems and manufacturing defects, such as lead paint or poor craftmanship, both rose in the past two years as U.S. makers have shifted more of their production to China.

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