Takata shares dented by bankruptcy
TAKATA shares plunged almost 11 percent yesterday following reports that the Japanese airbag maker, dented by the auto industry’s biggest-ever safety recall, was considering filing for bankruptcy in the United States.
With Tokyo investors coming back from a three-day weekend, the stock tanked in early trading before finishing the morning session at 348 yen (US$3.35), down 7.2 percent.
The drop came after the Wall Street Journal said the troubled company was “weighing a US bankruptcy filing as one option”, as it faces huge compensation costs over a defect linked to 16 deaths and scores of injuries globally.
The firm may seek court protection only for its US division, Bloomberg News reported, citing unnamed sources familiar with the matter.
More than 100 million Takata airbags have been recalled due to the defect, which can send metal and plastic shrapnel from the inflator canister hurtling toward drivers and passengers when an airbag is deployed.
The US National Highway Traffic Safety Administration has said the risk was greatest in hot and humid regions of the US. Most of the deaths have been in the US and Malaysia.
Some automakers in Japan are worried a bankruptcy filing could threaten Takata’s access to operating funds and disrupt their airbag supplies, the report said. –