Mattel apologizes to China over recalls

LOS ANGELES -- Mattel tried to save face Friday with Chinese officials, taking the blame for the recent recalls of millions of Chinese-made toys as it strives to mend a strained relationship with the nation that makes most of its toys and fattens its profit.

The world's largest toy maker sent a top executive to personally apologize to China's product safety chief, Li Changjang, as reporters and company lawyers looked on.

"Mattel takes full responsibility for these recalls and apologizes personally to you, the Chinese people, and all of our customers who received the toys," Thomas A. Debrowski, Mattel's executive vice president for worldwide operations, told Li.

The unusual move reflects how invested El Segundo-based Mattel has become in China.

"Mattel certainly must have been facing some pressure to do that, because you can't imagine why they would be trying to push this story along any further," said Eric Johnson, a professor of operations management at Tuck School of Business at Dartmouth College.

He suggested Mattel may want to prevent China from imposing more taxes or regulations.

"China's embarrassment in all this could lead to that, and I think they were trying to head that off with this apology," Johnson said.

Peter Navarro, a business professor at the University of California, Irvine, said Mattel was trying to avoid punitive measures.

"Mattel is worried that the Chinese government is going to make it difficult for them to produce, put their costs up and hurt their stock price," Navarro said.

In a prepared statement issued later Friday, the company said some media accounts of its meeting with Chinese officials had been mischaracterized.

"Since Mattel toys are sold the world over, Mattel apologized to the Chinese today just as it has wherever its toys are sold," the company said.

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.

Mattel previously said many of the toys were recalled because of design problems. It also said certain vendors in China or their subcontractors violated Mattel's rules by failing to use safe paint or to run tests on paint.

On Friday, Debrowski said the "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 added.

In a statement issued later, Mattel said its lead-related recalls were "overly inclusive, including toys that may not have had lead in paint in excess of the U.S. standards."

Li upbraided Mattel for maintaining weak safety controls and reminded Debrowski "a large part of your annual profit ... comes from your factories in China."

Since the recalls, Mattel has announced plans to upgrade its safety system. It has fired several manufacturers.

Chinese food, drugs and other products ranging from toothpaste to seafood are also under intense scrutiny because they have been found to contain potentially deadly substances.

China has bristled at what it claims is a campaign to discredit its reputation as an exporter. It accuses foreign media and others of playing up its product safety issues as a form of protectionism and has stepped up inspections of food, drugs and other products.

New research from two business professors shows recalls due to problems with the designs of U.S.-based companies accounted for about 76 percent of the 550 U.S. toy recalls since 1988.

The report was released earlier this month by 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.

It found recalls blamed on design problems and manufacturing defects both rose in the past two years as U.S. makers have shifted more production to China.

Manufacturing toys in China has helped Mattel and other U.S. companies lower manufacturing and labor costs, helping boost profits. Mattel makes about 65 percent of its products there. More than 80 percent of all toys sold in the U.S. are made there.

Mattel's apology garnered praise from some parents, including Arianna McRoberts, 41, of Los Angeles, the mother of two boys, 7 and 14.

"It's unfortunate China got the bad rap, but I also think China needs to pay attention a little more carefully to their standards so they comply with American standards," McRoberts said.

Johnson said the staging of Mattel's apology as a public event was telling.

"This was all about saving face, which is very important in the Chinese culture," he said.