$1B fine for deadly air bags

Japanese auto-parts maker Takata Corp. pleaded guilty to fraud Monday and will pay a $1 billion penalty for concealing a deadly defect in millions of its air bags.

Takata admitted hiding evidence that its air-bag inflators can explode with too much force, hurling shrapnel into drivers and passengers.

The inflators are blamed for at least 16 deaths worldwide — 11 of them in the US — and more than 180 injuries. The problem touched off the biggest recall in US automotive history, involving 42 million vehicles and up to 69 million inflators.

Chief Financial Officer Yoichiro Nomura entered the guilty plea on Takata’s behalf in Detroit federal court. He also agreed that Takata will be sold or merge with another company.

The penalties include $850 million in restitution to automakers, $125 million for victims and families, and a $25 million criminal fine.

Separately, three former executives in Japan are charged with falsifying test reports.

The inflators use ammonium nitrate to create a small explosion that inflates air bags in a crash. But when exposed to prolonged high temperatures and humidity, the chemical can deteriorate and burn too fast. That can blow apart a metal canister.

Nineteen US automakers, including Chrysler, Ford and GM, are recalling the inflators. Worldwide, the total number of inflators being recalled is over 100 million.

Plaintiffs in dozens of lawsuits against Takata allege the company knew the products were dangerous yet continued to use them for years to save money.

Takata’s penalty is small compared with the one imposed on Volkswagen, which must buy back cars and pay up to $21 billion in penalties to owners over its emissions-cheating scandal.