Dell Recalls Laptop Batteries

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By DAVID KOENIG, AP Business Writer

In the largest electronics-related recall involving the Consumer
Products Safety Commission, Dell Inc. agreed to replace 4.1 million
notebook computer batteries made by Sony Corp because they can burst
into flames.

A Dell spokesman said Monday that the Sony batteries were placed in
notebooks that were shipped between April 1, 2004, and July 18 of this
year.

"In rare cases, a short-circuit could cause the battery to overheat,
causing a risk of smoke and/or fire," said the spokesman, Ira
Williams.  "It happens in rare cases, but we opted to take this broad
action immediately."

The battery packs were included in some models of Round Rock,
Texas-based Dell's Latitude, Inspiron, XPS and precision mobile
workstation notebooks. Dell launched a Web site,
http://www.dellbatteryprogram.com , that described the affected
models.  Williams said the Web site would tell consumers how to get
free replacement batteries from Dell.

Rick Clancy, a Sony spokesman, said the companies have studied
problems with the battery packs intensely for more than a month, after
getting reports of about a half-dozen fires or smoking laptops in the
United States.

Lithium-ion batteries have been around for about a decade and are used
in devices such as cell phones and digital music players. Clancy said
tiny metallic particles sometimes short-circuit the battery cells,
adding that configuration in an electronic device can contribute to
problems.

"But it begins with the (battery) cell, and we acknowledge that," he
said. "That's why we're supporting Dell in this recall."

Clancy said Sony would help Dell pay for the recall, but neither he
nor Dell officials would estimate the campaign's price tag or say how
the companies would divide the cost. Benjamin Reitzes, an analyst with
UBS, estimated the recall could cost $400 million, with Sony bearing
most of it.

The larger potential cost for Dell is that such a huge recall could
dampen future notebook sales.

Dell rival Hewlett-Packard Co. said it does not use Sony batteries and
was not affected by the recall. Apple Computer Inc. is investigating
whether its notebook batteries meet safety and performance standards,
spokeswoman Lynn Fox said.

There have been numerous recent news reports about Dell laptops
bursting into flames, and pictures of some of the charred machines
have circulated on the Internet.

Dell, the world's largest maker of personal computers, confirmed that
two weeks ago, one of its laptops caught fire in Illinois, and the
owner dunked it in water to douse the flames. Other reports have
surfaced from as far away as Japan and Singapore.

Monday's move was at least the third recall of Dell notebook batteries
in the past five years.

Dell recalled 22,000 notebook computer batteries last December after
they had symptoms similar to those that prompted Monday's recall. The
company also recalled 284,000 batteries in 2001.

Consumers with affected laptops should only run the machines on a
power cord, said Scott Wolfson, a spokesman for the Consumer Product
Safety Commission.

The safety agency knows of 339 incidents in which lithium batteries
used in laptops and cell phones not just Dell products overheated
between 2003 and 2005, Wolfson said.

The list of problems ranged from smoke and minor skin burns to more
serious injuries and property damage, Wolfson said.

Most of the incidents reported to the CPSC occurred around the home,
but transportation-safety officials have become increasingly concerned
about the threat of a laptop causing a catastrophic fire aboard a
commercial jetliner.

Dell's recall comes as it battles other questions about quality and
customer service. Last year, Dell absorbed a charge against earnings
of $338 million to repair faulty computer components.

Dell's sales have grown this year, but less rapidly, causing shares in
the company to lose nearly one-half their value in the past 52 weeks.
The shares rose 49 cents, or 2.3 percent, to $21.73, in Tuesday
morning trading on the Nasdaq Stock Market.

Sony shares rose 47 cents, or 1.1 percent, to $45.28 on the New York
Stock Exchange.

On The Net:

http://www.dellbatteryprogram.com

Copyright 2006 The Associated Press.

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