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Japan expands Takata air bag recall by about 7 million vehicles

Friday, May 27, 2016

Japan's transport ministry said on Friday automakers will recall about an additional 7 million cars equipped with Takata Corp (7312.T) air bag inflators without a drying agent by March 2019, bringing the total recalled in the country to 19.6 million cars.

Japan's latest announcement may further ramp up Takata's potential recall costs if the air bag maker is found to be responsible for the defective inflators.

The company is in bailout talks with a number of potential investors including private equity firm KKR & Co (KKR.N), people familiar with the matter told Reuters on Thursday.

The transport ministry said Takata and automakers had found the absence of desiccants could make ammonium nitrate used in the air bag inflators deteriorate when exposed to temperature changes over a long period of time.

Its decision comes after U.S. transport authorities earlier this month expanded its recall of air bag inflators made by the Japanese parts supplier, which will result in an additional 35 million to 40 million products withdrawn from the U.S. market.

The ministry said that the latest recall covers mainly passenger-side airbags, and will be conducted in phases. It would not comment on which automakers were affected, although it said that the number would likely increase from the 17 companies affected so far.

The ammonium nitrate-based propellant used in the inflators have a tendency to explode violently in hot, humid conditions, spraying metal shrapnel into vehicle compartments. The defect has been linked to 13 deaths and more than 100 injuries globally, mainly in the United States.

Honda Motor Co (7267.T), once Takata's biggest buyer of airbags, earlier this month said it would recall 21 million more potentially faulty airbag inflators globally, while Toyota Motor Corp (7203.T) last week said it would recall almost 1.6 million additional U.S. vehicles installed with front passenger side Takata air bags.

 

Source : reuters.com

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