JAPAN: CEO says Takata funded to deal with airbag recalls

By Graeme Roberts | 18 December 2014

Takata CEO said the supplier has funds to deal with the recall of 21m cars

Takata CEO said the supplier has funds to deal with the recall of 21m cars

Takata has sufficient funds to deal with a global recall that has climbed to about 21m vehicles after five deaths linked to its products, a top company executive told the Nikkei business newspaper.

According to Reuters, Takata CEO Shigehisa Takada, grandson of the company founder, said it was analysing collected inflators to determine the cause of defects with its air bags which can explode with excessive force and spray shrapnel into cars.

Takada, whose family owns nearly 60% of the company, has not made a public appearance since an annual shareholder meeting in June. He told the newspaper he was not intentionally avoiding the public but was directing the company's response to the crisis.

"Takata is prioritising the supply of replacement parts. We have sufficient funds put aside, and we are not concerned that we are under-capitalised. We will take steps on the financing side if needed," he told the newspaper.

The deaths, four in the United States and one in Malaysia, have all been in Honda cars fitted with Takata air bags.

Takata has so far put aside $774 million to deal with recalls, but it faces dozens of class-action lawsuits as well as a US criminal investigation, Reuters noted.

Takata has identified and corrected manufacturing problems, including mismanagement of ammonium nitrate, a chemical that has been used in its air bag inflators since 2000, Takada said. The company was analysing around 100 inflators a day to determine a cause for the defect, he added.

The parts maker also is boosting production of replacement inflators at its factory in Mexicobut US and Japanese regulators and major automakers have expressed concerns there will be a shortage of the parts to meet the huge recall.

Honda Honda has said it is looking to rival air bag inflator makers Autoliv and Daicel for replacement parts to carry out the Takata-related replacements.