Product Recalls Shift Focus From Frequency to Scale, With Volumes Reaching 3-Year Highs

While the number of product recall events declined in Q3 2025, the magnitude of affected units surged to levels not seen in nearly three years, signaling a fundamental change in how manufacturers must approach product safety strategy, according to the Sedgwick Product Safety and Recall Index.

The disconnect between falling recall counts and surging unit volumes reveals a critical trend: when recalls occur, they now affect far more products. In the third quarter of 2025, the number of recall events dropped 9.2% to 782 from Q2’s 861, yet the affected units exploded to 258.98 million—a 201.6% increase from 85.87 million the previous quarter. Year-to-date, Sedgwick’s recall data shows 2,418 total recall events in the U.S., affecting 470.22 million units across all sectors, the report said.

The Paradox: Fewer Events, Massive Impact

This divergence held across all five industries tracked in the report—automotive, consumer products, food and drink, pharmaceutical, and medical devices.

The pharmaceutical sector posted its highest quarterly count since early 2023 with 44.56 million units recalled, while food and beverage recalls from the U.S. Department of Agriculture reached a 13-year peak of 58.52 million pounds affected. Medical device recalls jumped 237% in volume, reaching 108.39 million units despite a slight decline in the number of recall events. The automotive sector saw 25.3% growth in affected units despite a 12.6% decline in recall incidents.

This divergence matters significantly, according to Sedgwick. When a single recall endangers millions of consumers, the operational and reputational consequences for manufacturers expand exponentially, requiring more sophisticated coordination across supply chains, regulatory bodies, and consumer communications channels.

Regulatory Pressure Intensifies Across Multiple Fronts

The report identifies robust regulatory activity across multiple federal agencies as a primary driver reshaping product safety expectations. The Food and Drug Administration, Consumer Product Safety Commission, National Highway Traffic Safety Administration, and USDA all proposed new regulatory measures in Q3, spanning automated driving systems, lithium-ion batteries, children’s toys, and meat products.

Beyond traditional product defects, new technology poses emerging risks that regulators and manufacturers are scrambling to address. The Department of Justice secured a $9.8 million settlement in the first cyberattack-related medical device lawsuit, citing alleged cybersecurity vulnerabilities in genomic sequencing systems. The FDA’s updated guidance on medical devices with network connectivity defined “connectivity” broadly to include any device capable of connecting to the internet, whether intentionally or through ports like USB.

Additionally, artificial intelligence integration into medical devices created fresh compliance challenges. The FDA identified 1,247 AI-enabled medical devices on the market as of October 2025, with approximately half approved within the past two years. The agency issued guidance on “Predetermined Change Control Plans” to address how AI-enabled devices evolve through learning processes that may alter their approved characteristics.

Tariff policies and trade agreements also reshaped the supply chain landscape. The Trump Administration’s 100% tariff order on branded pharmaceuticals without domestic manufacturing, combined with a Section 232 investigation into medical device imports, introduced new pressures that could influence manufacturing decisions and supply chain resilience.

Strategic Imperatives for Risk Managers

For organizations responsible for product integrity and brand protection, the current environment demands a fundamental recalibration of risk management strategies, according to the report. The tendency toward massive single-recall events means that companies can no longer rely solely on distributed risk management approaches; a single quality failure now poses exponential exposure.

Companies that view recall insurance as a proactive risk management tool rather than a financial backstop position themselves to respond more effectively when incidents occur, Sedgwick said. The report noted that recall insurance provides more than financial reimbursement. Policies typically include access to networks of crisis management, regulatory, and public relations specialists available on demand during high-stress situations. Pre-incident loss mitigation provisions help companies establish tested protocols and incident response plans before crises occur.

Manufacturers also face pressure from major retailers increasingly requiring suppliers to carry recall insurance as contractual obligations. For smaller companies seeking to enter larger supply chains, carrying insurance serves as a competitive differentiator signaling strong risk management practices.

Forward-looking companies should establish clear internal protocols for incident review and escalation, implement comprehensive systems to track product components and suppliers, identify key personnel across departments who will manage recalls, and develop corrective action plans that offer customers full and easily obtainable remedies. Legal precedent demonstrates that effective recall remedies can prevent costly litigation by rendering plaintiff claims moot when manufacturers proactively offer comprehensive solutions.

Learn more and obtain full report here. &