Takata files for bank­ruptcy, ri­val Key to ac­quire most as­sets

The Washington Times Daily - - NATION -

DETROIT | Ja­panese air bag maker Takata Corp. has filed for bank­ruptcy pro­tec­tion in Tokyo and the U.S., over­whelmed by law­suits and re­call costs re­lated to its pro­duc­tion of faulty air bag in­fla­tors that are linked to the death of at least 16 peo­ple.

The com­pany an­nounced the ex­pected action Mon­day morn­ing Tokyo time. Takata con­firmed that most of its as­sets will be bought by ri­val Key Safety Sys­tems, based in sub­ur­ban Detroit. Key will pay about $1.6 bil­lion (175 bil­lion yen), ac­cord­ing to an an­nounce­ment by the two com­pa­nies.

Takata’s de­fec­tive in­fla­tors can ex­plode with too much force when they fill up an air bag, spew­ing out shrap­nel. Be­sides the fa­tal­i­ties, they also caused at least 180 in­juries, and touched off the largest au­to­mo­tive re­call in U.S. his­tory.

Un­der the agree­ment with Key, Takata’s man­u­fac­tur­ing of in­fla­tors will be kept sep­a­rate in or­der to keep

man­u­fac­tur­ing in­fla­tors used as re­place­ment parts in re­calls. The re­calls, which are be­ing han­dled by 19 af­fected au­tomak­ers, will con­tinue.

Key also said it won’t cut any Takata jobs or close any of Takata’s fa­cil­i­ties.

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