Takata May Sell Airbag Divisions To Cover Cost Of Recall

Posted: Feb 19 2016, 5:44am CST | by , in News | Cars & Vehicles

 
Takata May Sell Airbag Divisions to Cover Cost of Recall
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  • Takata may sell divisions to cover cost of recall!

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Takata may also cut back on its airbag operations to cover possible expenses worth billions of dollars.

The restructuring plan by Takata to cover its potential recall expenses could force it to sell assets. Takata may have to sell whole divisions and cut back its airbag operations in Europe.

According to Reuters, nine Takata airbag manufacturing locations in Europe may be cut back. Takata may also be considering selling non-core business.

It means Takata may sell divisions which produce automotive items other than seat belts. Takata also manufactures seatbelts, steering wheels, and child seats. The cutbacks could mean shedding overseas jobs especially in Europe.

If Takata is found guilty in the airbag scandal it could mean billions of dollars in expenses. Takata is involved in a scandal which sees the recall of about 50 million vehicles.

The recall is due to exploding air bags which has caused at least 10 deaths so far. US regulators are trying to identify the root cause of the defective air bags.

If Takata is guilty then the recall bill could cost it more than $3 billion, according to Reuters. It was found Takata airbags exploded upon impact releasing metal shrapnel in the driver’s cabin.

Some sources are claiming Takata knew about the defect as early as 2000. If it is found to be true Takata may be well in deep trouble.

Honda and Toyota have already been working towards severing ties with Takata. Although Takata claims to have made profits, their shares have fallen dramatically.

Recently it was announced Takata Chairman and CEO Shigehisa Takada will be stepping down. It was found Takada will take responsibility for the recalls as part of reforms within the company.

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