The Takata bankruptcy is due to defective airbags. Takata, the Japanese parts manufacturer, has filed for bankruptcy protection in Japan and the US. Defective airbags manufactured by Takata have been found to be defective, and their failure has led to at least 17 deaths worldwide.
The major cause of the deaths appears to be that the defective airbags contained faulty inflators. These expanded the airbags with so much force that drivers and passengers were being hit by flying metal shrapnel. The first incidence took place in a Honda Accord in 2004 where a driver in Alabama was injured. Honda and Takata both stated the incident to be an anomaly. The extent of the problem was hidden for a number of years.
This cover up was not made public until 2014, when the New York Times published a report relating to the cover-up. This led to Takata being faced with legal action and the company admitted the problem and accepted responsibility in 2015.
In a press conference on Monday, the chairman and CEO of Takata, Shigehisa Takada, apologized and promised his resignation once a new management team took over. He had previously been criticized multiple times for his poor handling of the issue. Few will be sad to see him go.
Although the manifestation of the problem with the airbags is well known, its cause is not so well known. In fact, it has not yet been identified. The recall is a huge one, yet even so, the cause of the problem has not yet been identified. Takata has admitted to not knowing how many vehicles with faulty airbags are still on the road. In January, the firm agreed to pay penalties of $1 billion for concealing the defects and pleading guilty to the charge.
Takata currently faces legal action in the US for liabilities of 1 trillion yen (&9 billion). Honda Nissan and Toyota have been paying for the recall charges themselves up to now. They are not confident that these will be repaid to them by Takata. Trading in Takata shares has been suspended on the Tokyo Stock Exchange, and the firm will be delisted in July.
Takata’s assets have been purchased by US company Key Safety Systems (KSS) other than those connected to the airbag issue. Over 100 million vehicles fitted with Takata airbags have been recalled so far. 700 million of these were in the USA. This is the largest safety recall in automotive history. The Takata bankruptcy is well on the way.
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