What is the official investigation progress regarding the brake bracket fracture?

【Answer 1】 We know some people are anxious—but please hold on a moment. Many readers will recall the 'diaper testing' incident; let’s first recap its timeline: June 18｜Public opinion erupts The Economic Reference News published a report stating that formaldehyde—a substance commonly misreported as 'formamide' in Chinese media—was detected in diapers from brands including Huggies, Bb. Baby, and Babycare during market sampling. On the same day, it also reported that formaldehyde had been screened from infant blood samples at a Shandong-based institution. Parental panic spread rapidly, prompting some to revert to cloth diapers. June 19｜First wave of rebuttals The Shandong Provincial Center for Public Health Clinical Medicine publicly denied having conducted any such research. The Hygiene Products Professional Committee of the China Paper Society issued a statement pointing out serious flaws in the report’s testing methodology, data disclosure, and causal reasoning. Yet skepticism failed to outpace public fear. Around June 20｜Social media amplification Accounts including 'Reliable Old Wang' (Wang某某, founder of Shenzhen Burui Biotechnology) on Xiaohongshu, and 'Shen Bo Health Evaluation' (Shen某) on WeChat Video Channel and Douyin, successively posted review videos and test screenshots, pushing public concern to its peak. June 22｜Joint investigation launched by four ministries The State Administration for Market Regulation, Ministry of Industry and Information Technology, National Health Commission, and Chinese Center for Disease Control and Prevention jointly established an investigative task force, conducting on-site inspections, retesting, and experimental replication across multiple regions. June 25｜Leak of '414/384 reports' Two screenshots of test reports from Lianxin Testing (Jiangsu), indicating formaldehyde levels of 414 mg/kg and 384 mg/kg respectively, circulated widely online. On June 26, Lianxin Testing issued a statement: These were merely draft electronic reports sent to clients for sample and client information verification. During internal review, analysts found the retention time of the characteristic peak did not match formaldehyde standards, leading them to conclude 'not detected.' The reports were withdrawn and declared invalid. July–September｜Industry under pressure; companies self-verify Brands collectively undertook independent verification. In its Q2 2024 earnings report released on August 4, Kimberly-Clark explicitly cited the formaldehyde-related public controversy as having weighed down its China business, reaffirming that no formaldehyde was detected in its products. On September 20, Hangzhou Baibeike Industrial Co., Ltd.—the operating entity behind Babycare—filed a commercial defamation lawsuit against Wang某某 and related Burui-affiliated companies with the Hangzhou Intermediate People’s Court, which accepted the case.

The 'diaper formaldehyde controversy' severely impacted Kimberly-Clark’s performance; weak demand in the Chinese market dragged down global results; the CEO called this the company’s biggest public relations crisis to date—how should we interpret this?

【Answer 2】 Following the 'diaper formaldehyde controversy,' Kimberly-Clark—the parent company of Huggies—released its first financial report addressing the incident. Weak performance in the Chinese market significantly dragged down global results, and CEO Mike Hsu described the event as 'perhaps the largest social-media-driven public relations crisis we have ever faced.' Reporters: Fan Qianqian, Wang Fan; Editor: Wei Guanhong, Every Day Economic News A formaldehyde-related controversy in June this year deeply unsettled new parents across China. Affected diaper brands rushed to publish third-party lab test certificates—but consumer concerns remained unassuaged. Now, although the joint investigation team formed by four government departments has yet to release its findings, affected brands have already suffered tangible financial consequences. 'In the second quarter, we experienced a major external one-time shock in the Chinese market, which significantly impacted our diaper business,' said Mike Hsu, CEO of Kimberly-Clark, during the earnings call held on August 4 (local time). He characterized the incident as 'not the first of its kind, but perhaps the largest social-media-fueled public opinion storm we’ve encountered to date.' Recently, Kimberly-Clark released its Q2 financial results: net sales reached $4.2 billion, up 0.6% year-on-year; operating profit stood at $633 million. 'Organic sales growth for Q2 came in about one percentage point below our expectations—primarily due to sales disruption in the Chinese diaper market during the last two weeks of June and reduced inventory levels in the North American market,' said Nelson Urdaneta, Kimberly-Clark’s CFO. The Every Day Economic News reporters noted that, during the early phase of the 'diaper formaldehyde controversy,' Huggies’ response was handled solely by Kimberly-Clark’s China team. This time, however, senior executives from the company’s global headquarters addressed the controversy directly—for the first time—speaking to global investors and analysts. Responding to the 'diaper controversy': No further deterioration—and no positive turnaround yet According to insights from the earnings call, the 'diaper formaldehyde controversy' reduced Kimberly-Clark’s Q2 organic sales growth rate by 1.4 percentage points and its operating profit growth rate by 4.4 percentage points. For the full year, the incident is expected to lower organic growth in Kimberly-Clark’s International Personal Care business by 3–4 percentage points, and operating profit growth by 10–12 percentage points—exerting approximately one percentage point of downward pressure on the group’s overall growth. Faced with the tangible impact on financial performance, Kimberly-Clark executives repeatedly emphasized the 'falsehood' and 'misleading nature' of the allegations during the analyst call. 'Just before the '618 Shopping Festival,' false and misleading claims about the quality of multiple diaper brands in the Chinese market surfaced and quickly went viral on social media. These claims lack any scientific basis; multiple independent tests conducted by certified third-party laboratories have confirmed the safety of our products,' said Russ Torres, Chief Operating Officer of Kimberly-Clark, during the earnings call. He further stated that Kimberly-Clark’s strategy for handling this incident involves continued proactive efforts, substantial investment in reinforcing factual information about its products, rapid transparent communication with consumers, and active engagement with retailers, government agencies, and other stakeholders. Yet clearly, until the joint investigation team releases its official findings, the shadow of doubt over Huggies diaper quality will linger in consumers’ minds.

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Kimberly-Clark Maintains Outlook Despite Lingering China Diaper Contamination Claims

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