Product recalls are projected to reach a six-year high in 2024, with over 2,450 recalls affecting more than 580 million units in the first nine months, according to a report by Sedgwick, highlighting the urgent need for improved quality control and recall preparedness across industries.

As the year progresses, Sedgwick projects these numbers could climb even higher, potentially setting a new six-year record for product recalls. The report includes an early look at October recall events, finding that activity in the month exceeded Q3 monthly averages in several sectors.

As of September 30, a total of 2,454 product recalls were issued across five key industries. This figure closely aligns with the 2,459 recalls recorded during the same period in 2023, which ultimately set a five-year annual high. If the current pace continues through the fourth quarter, 2024 is poised to reach a six-year peak in total recalls, the report noted.

The impact of these recalls extends beyond mere numbers. The first nine months of 2024 saw a 9.8% year-over-year increase in defective units, rising to 580.4 million from 528.7 million in the same period last year. This surge was primarily driven by significant growth in three industries: Medical device recalls experienced the most dramatic increase, increasing by 134.5%. This was followed by U.S. Department of Agriculture (USDA) food recalls, which jumped 112.7%. Consumer product recalls also saw a substantial uptick, rising by 38.5%.

Despite the overall upward trend, the third quarter of 2024 showed some fluctuations. The total number of units recalled across all observed industries decreased by 22.9%, falling from 254.56 million in Q2 to 196.26 million in Q3.

Three industries bucked the downward trend in Q3, experiencing increases in impacted units. The automotive sector saw a surge in recalled units, while the pharmaceutical industry also reported an uptick. Notably, USDA food recalls reached their highest total since Q3 2021, indicating ongoing challenges in food safety and quality control, according to the report.

Key Challenges and Drivers Behind Recall Trends

The product recall landscape across major industries reveals persistent challenges and emerging trends that are shaping the safety and quality control measures in various sectors.

Automotive: In the automotive industry, a surprising trend has emerged: despite a 3.3% decrease in the number of recalls issued by the National Highway Traffic Safety Administration (NHTSA) in Q3 2024, the number of impacted units surged by 43.6%, rising from 4.97 million in Q2 to 7.14 million in Q3. This significant increase in affected vehicles underscores the growing complexity of automotive systems. Notably, electrical systems have become the most common reason for automotive recalls by volume, with 2.82 million units impacted in Q3 2024 – a staggering 244.9% increase from the previous quarter.

There were 93 U.S. automotive recalls in October 2024, up 19.2% compared to the Q3 2024 monthly average of 78 events.

Consumer products: The consumer products sector faces its own set of challenges, with fire hazards remaining the top concern for six consecutive quarters. In Q3 2024, fire was linked to 16 recalls, maintaining its position as the leading risk since the second quarter of 2023. Burns and fire risks are particularly prevalent in large-scale appliance recalls, as evidenced by a significant recall of handheld steam cleaners due to burn risks and slide-in electric ranges due to fire hazards. These two recalls alone accounted for over 1 million affected units each.

There were 13 U.S. consumer product recalls in October 2024, down from the Q3 2024 monthly average of 23 events.

Food and drink: In the food and beverage industry, undeclared allergens continue to be a persistent top concern, leading Food and Drug Administration (FDA) food recalls with 47 events in Q3 2024. Nuts were the most common undeclared allergen, cited in 14 recalls, followed by milk with 12 events. However, bacterial contamination is also driving major recalls, as demonstrated by a large recall of ice cream and other frozen desserts due to Listeria contamination, impacting 1.71 million units.

The FDA issued 51 food and drink recalls in October 2024, up 37.8% from the Q3 2024 monthly average of 37 events. In October 2024, the USDA issued two recalls, down from the Q3 2024 monthly average of three events.

Pharmaceutical and medical: The medical device and pharmaceutical sectors are grappling with their own complexities. Device failures have emerged as the leading cause of medical device recalls, accounting for 43 events and affecting 64.71 million units in Q3 2024. Software issues closely follow as the second most common concern, with 27 events. Notably, Class I medical device recalls – the most serious category – have reached a 15-year high in 2024, despite a slight decrease from 30 in Q2 to 26 in Q3.

There were 23 pharmaceutical recalls in October 2024, which was on par with the Q3 2024 monthly average of 23 events. In October 2024, there were 101 medical device recalls, an increase from the Q3 2024 monthly average of 87 events.

Strategic Considerations for Businesses

Recent political shifts may herald changes in enforcement practices, potentially altering the playing field for companies across industries, Sedgwick noted. With the newly elected Republican president and a Republican-leaning Congress, there may be efforts to pull back some of the regulations businesses feel are overly burdensome, especially around emissions. The U.S. may also see
more tariffs on certain imports. In addition, some Republican leaders are talking about major overhauls to various departments, including the FDA, the report stated.

“We have seen strict regulatory scrutiny over the past several years, with agencies receiving criticism when they don’t seem to be doing enough. However, the recent elections may result in weakened enforcement and rulemaking authority for regulators and a shift in priorities,” commented Chris Harvey, senior vice president of Brand Protection for Sedgwick.

Despite this potential easing of regulatory pressure, Harvey emphasized that product safety will remain a critical concern for both consumers and regulators.

View the full report here. &