For Sale: One Disgraced Airbag Manufacturer, to Good Home
In case you hadn’t heard, Takata Corporation has been raked over the coals for some time now, due to the fact that humidity and warm temperatures can ironically turn their airbag inflators into shrapnel-throwing grenades, creating the largest automotive recall in history.
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Now, the long process of fining and lambasting is coming to something of a conclusion, with Takata pleading guilty in a US federal court to a felony charge as part of a $1 billion settlement—this includes funds to compensate both automakers and the victims of its exploding airbag inflators.
So now, sorely beaten and with a severely tarnished reputation, Takata has one chance at survival: get someone to buy it. The manufacturer has already been working on this for about a year, although with charges pending in the US courts, talks have stalled. The plea bargain could re-energize those talks, particularly in Japan.
According to anonymous sources talking to Reuters, the top candidate is Chinese-owned auto supplier Key Safety Systems, and a decision would likely be reached by the end of March.
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Before that, Takata now has to pay a $25 million fine, and has 30 days to pay for the victim compensation fund of $125 million. The company has up to a year to deliver the remaining $850 million for automaker compensation; however, if it finds a backer, that year is abruptly shortened to five days.
All in all, Takata is lucky that it will survive this whole thing at all—the US judge presiding over the case commented that, “Destruction of the corporation would probably have been a fair outcome in this case.” However, he decided to approve a settlement that would let the company survive because pushing Takata into bankruptcy would only delay the replacement of the deadly inflators.
News Source: Reuters