'Zippo' battery recall could cost Sony $430m and a truck
Come on baby, light my profits
Dell has suffered from the bad press associated with its 4.1m fire-breathing laptop batteries that were recalled this week. But it's Sony - the maker of the lithium-ion batteries - that looks to front most of the financial burden for replacing systems.
Sony's line of recalled "Zippo" batteries could cost the company close to $430m, according to wild speculation from analysts.
Analyst Roger Kay at Endpoint Technologies has Sony's costs pegged somewhere between $200m and $300m, while Macquarie analyst David Gibson says Sony will shell out up to $260m. Those ranges didn't stop Reuters from claiming the $430m figure and attributing it to no one.
The scope of the recall costs will depend on whether or not other PC makers complain about gear supplied by Sony. The company's battery customers include the likes of HP, Apple and Lenovo. The US Consumer Product Safety Commission has kicked off an investigation into the complete spectrum of products using Sony's batteries.
Dell doesn't see a "material" financial impact from the recall, although the company could be punished by slowed sales in the months to come. The hardware maker has been spending millions to repair its image and boost sales. Customers, however, have not embraced the idea of the laptop lighter add-on as a "feature."
The Washington Post reports,
In an incident last month, Thomas Forqueran, 62, of Arizona, was loading his truck and smelled smoke. Flames were shooting out of his Dell Inspiron laptop, which he had placed on the passenger side of the vehicle, and spread as the fire ignited ammunition that was also in the truck. The truck, a 1966 Ford F-250 passed down from his father, was destroyed by fire.
"I see Dell commercials half a dozen times a night, saying 'What can we build for you today?' " Forqueran said. "And I say, 'Grandpa's truck.' "
Dell has been forced to recall hundreds of thousands of batteries over the past few years, although this week's catastrophe marks the largest recall in US consumer electronics history.
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