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Mattel Apologizes to China for Toy Recalls

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Mattel Apologizes to China for Toy Recalls

Business

Mattel Apologizes to China for Toy Recalls

Mattel Apologizes to China for Toy Recalls

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Toy company Mattel apologizes to China, taking full responsibility for recent toy recalls. The U.S.-based company said its own design flaws were primarily at fault. The recalls cast aspersions on Chinese-made products.

MELISSA BLOCK, host:

From NPR News, this is ALL THINGS CONSIDERED. I'm Melissa Block.

Big toymaker Mattel took an unusual step today. It apologized to the Chinese government for any embarrassment caused by three recalls of Chinese-made toys. Mattel said it caused most of the problems that led to the recalls, not China.

Here's NPR's Adam Davidson.

ADAM DAVIDSON: This was not a spontaneous apology. It was more like a formal ritual at the emperor's palace. Mattel's executive vice president Thomas Debrowski said the majority of the toy recalls were caused by Mattel's own design errors, not because Chinese factories made mistakes. This came in a written apology he read to Li Changjiang, China's head product safety official.

Then, Debrowski listened as Li castigated him and Mattel for bringing so much negative attention to China. This all happened in a room filled with Chinese bureaucrats, Mattel attorneys and foreign reporters. It's easy to see what's in it for China says Robert Kapp, former president of the U.S.-China Business Council.

Mr. ROBERT KAPP (Former President, U.S.-China Business Council): China has been very, very concerned that the "Made in China" phrase will become a kind of a pariah label.

DAVIDSON: But why would Mattel agree to this extraordinary apology? After all, a good number of the toys were recalled not because of design problems but because of lead paint put on them in a Chinese factory. Why wouldn't Mattel at least make China share the responsibility? We don't know for sure. Nobody at Mattel would comment. But Kapp says, in China, the government is quick to get involved in a company's business.

Mr. KAPP: Every company operates under the aegis of government authorities who have the capacity to step in and stick their noses into what's going on anytime they want. And when a big crisis like this comes along, the Chinese government sticks its nose in very quickly.

DAVIDSON: In short, China seems to have made Mattel an offer they couldn't refuse. Mattel might have fought off such a Chinese request if it was worried about public reaction back home in the U.S. But Linda Bolton Weiser, a stock analyst at Oppenheimer & Co. says the three big recalls this summer haven't been a big financial problem. Their sales are doing great, very few people seem scared off, and Mattel stock price initially slid a little. It was twenty-three and a half dollars before the first recall, then it fell a couple of bucks.

Ms. LINDA BOLTON WEISER (Stock Analyst, Oppenheimer & Co.): And today, the stock is 24. The stock is above now where it was prior to the recall.

DAVIDSON: Now, China might have to call on to other companies. Today, one million Simplicity and Graco cribs were recalled because of faulty design. The cribs were made in China.

Adam Davidson, NPR News.

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