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Old 26th June 2017, 16:56   #1
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Default Takata files for bankruptcy, to be bought by US-based firm

Japan-based airbag manufacturer Takata has filed for bankruptcy protection in the US and Japan. This is being seen as a consequence of the company's accumulating losses as it faces billions of dollars in costs and liabilities due to its defective airbags. Takata has officially revealed that it will be sold to US-based Key Safety Systems, in a deal worth US$ 1.6 billion.

The company's US-based arm, TK Holdings had filed for Chapter 11 bankruptcy in Delaware, while the Japanese parent company has also filed for similar protection with the Tokyo District Court. It is being speculated that the company will in total have a liability estimate of around US$ 15 billion. However, the final figure will be available only when various car-makers, who used Takata airbags, have a discussion and reach a liability figure with the airbag supplier. Currently, these carmakers have borne the major brunt of the recall and replacement costs.

Key Safety Systems will buy all Takata assets, apart from those that are related to airbags. The US-based firm believes that Takata's other products, like steering wheels and seat belts, still have satisfactory brand image and market demand. The company has claimed that it is likely to keep "substantially all" Takata employees, which amount to a 60,000 workforce that is spread over 23 countries.

Takata has been at the center of the biggest automotive recall ever seen, after its airbags were found to have a potential defect that makes them volatile with age and prolonged exposure to heat. This can result in sudden explosion of the airbag inflator with higher force, which could cause metal shards to be thrown around the cabin, leading to the risk of an injury to the driver and occupants. The said issue has been linked to at least 17 deaths across the globe.

Source: Reuters

Takata files for bankruptcy, to be bought by US-based firm-1.17takata2.jpg
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Last edited by tsk1979 : 28th June 2017 at 14:14.
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Old 26th June 2017, 20:27   #2
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

This is interesting that one product failure is resulting in company going out of business because of the cascading impact of liabilities.
It is all the important to note here that Takata is one of the leaders in active and passive safety device producers and if the new buyer stops producing airbags (for which there is a fix possible) will straightaway give market shares to others.
Am I smelling a rat here?
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Old 27th June 2017, 02:07   #3
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

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Originally Posted by i74js View Post
This is interesting that one product failure is resulting in company going out of business because of the cascading impact of liabilities.
It is all the important to note here that Takata is one of the leaders in active and passive safety device producers and if the new buyer stops producing airbags (for which there is a fix possible) will straightaway give market shares to others.
Am I smelling a rat here?
It is not product failure that led to its demise. That sounds too benign.

In the name of cost-cutting, Takata started using Ammonium Nitrate -- a cheaper, but unstable compound in its airbag inflators. When it started becoming clear that it was the wrong decision, there was a massive cover-up. If they had been forthright at the outset, the scale of the recalls and deaths would probably be much lower and they would not be bankrupt today.

In short, they deserve to go out of business. In fact, many people working at Takata deserve to go to jail.
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Old 27th June 2017, 09:03   #4
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

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Originally Posted by coolvenk View Post
In short, they deserve to go out of business. In fact, many people working at Takata deserve to go to jail.
Glad you said it before I did, I had also commented long back that Takata needs to be seriously punished for what they did, nothing short of their closure will bring justice and I'm happy that its over.

Think about it.. an airbag which is supposed to cushion a driver when everything goes wrong during driving, simply explodes out of nowhere when the driver is normally driving, what a horrible product and what a horrible company that they had to be pulled up by courts and with multiple dozen cases for them to admit their mistake. Ironically they STILL made airbags with ammonium nitrate, oh my god.

Here's something interesting to read about for our forum members :

Quote:
In the late 1990s, General Motors got an unexpected and enticing offer. A little-known Japanese supplier, Takata, had designed a much cheaper automotive airbag. G.M. turned to its airbag supplier — the Swedish-American company Autoliv — and asked it to match the cheaper design or risk losing the automaker’s business, according to Linda Rink, who was a senior scientist at Autoliv assigned to the G.M. account at the time.
But when Autoliv’s scientists studied the Takata airbag, they found that it relied on a dangerously volatile compound in its inflater, a critical part that causes the airbag to expand. “We just said, ‘No, we can’t do it. We’re not going to use it,’” said Robert Taylor, Autoliv’s head chemist until 2010.
That settles it I suppose, its a misnomer in actual that Japan/South Korea stand for quality, where the details and critical parts matter, the Europeans stand for ultimate quality, you just got to pay 2-3 times the price for that. Take Bosch, DuPont, Autoliv, Continental AG etc.

As for other airbag manufacturers, there are plenty and these are companies with no record of using spurious compounds for their units :

Autoliv (Swedish) - gold standard for airbags, they do Volvo.
TRW (American)
Key Safety Systems (KSS-American)
Daicel (Japanese)
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Old 27th June 2017, 13:21   #5
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

Here is a video which will help us to understand the issue better!
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Old 27th June 2017, 14:06   #6
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

Key Safety Systems is owned by a Chinese company, Ningbo Joyson Electronic Corp. Ningbo acquired the company for ~$920M in 2016. Couldn't find any reference to the Chinese company anywhere on the Key Safety website apart from the press releases.

http://www.autonews.com/article/2016...merate-in-$920

Last edited by Rehaan : 27th June 2017 at 14:27. Reason: Making link clickable :)
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Old 27th June 2017, 18:26   #7
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

Where can one find the list of cars that have used the Takata airbags as OEM? Alternately, where can one find the details of the airbag?

I read somewhere that the seat belt tag is a good place to look to check the manufacturer of the airbag. I thought this was strange. However, when I checked it, it has a marking of KSS Abhishek, made in India.
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Old 28th June 2017, 13:40   #8
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

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Originally Posted by swissknife View Post
Where can one find the list of cars that have used the Takata airbags as OEM? Alternately, where can one find the details of the airbag?

I read somewhere that the seat belt tag is a good place to look to check the manufacturer of the airbag. I thought this was strange. However, when I checked it, it has a marking of KSS Abhishek, made in India.
KSS Abhishek is a joint venture between the aforementioned American KSS & Abhishek, an Indian company to manufacture airbags and other safety equipment for cars.

As for TAKATA users, I'm sure Honda Cars India Ltd certainly used TAKATA. Thousands of their cars were recalled in India for this issue.
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Old 28th June 2017, 21:18   #9
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Default Re: Takata files for bankruptcy, to be bought by US-based firm

Given the extent of the messup across continents, bankruptcy was inevitable and perhaps well deserved one, given the pain they caused.

In such cases wonder who foots the liability bill?
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