- Supplier calls meeting with carmakers to discuss business plan
- 5 million more air-bag inflators recalled after 10th death
Takata Corp. fell to the lowest in almost seven years after its U.S. regulator said recalls of the company’s air bags would expand to millions more vehicles following a 10th death linked to the devices.
The shares declined 9.8 percent to 608 yen in Tokyo trading, their lowest closing price since March 2009. The National Highway Traffic Safety Administration on Friday announced the company faced another two recalls covering 5 million air bag inflators after a ninth U.S. death involving Takata components.
The December death involving a driver of a 2006 Ford Ranger pickup is likely to renew concerns about Takata’s viability. Honda Motor Co., the Japanese auto-parts supplier’s biggest customer, said Monday it was invited to a Jan. 29 meeting in which Takata will address its future business plans. Takata declined to comment on the meeting.
“We will maintain a negative outlook for Takata as we expect there should be even more bad news to come,” Tadashi Ono, a Tokyo-based analyst at Japan Credit Rating Agency Ltd., said by phone. “Risks still remain as many of the recalled vehicles are still driven on the road and accidents like these can happen anytime.”
Takata’s recalls already involved about 23 million air bag inflators in 19 million vehicles before NHTSA’s announcement last week. The agency couldn’t immediately say how many additional vehicles would be recalled because some have multiple inflators and may have been previously recalled.
The two latest recalls involve cars made by Ford Motor Co., Honda, Volkswagen AG, Daimler AG, Audi AG, Mazda Motor Corp., Saab AB and BMW AG.
The driver of the 2006 Ford Ranger pickup died in December after the truck swerved off a road in South Carolina and hit an obstruction, NHTSA said Friday. Agency investigators said that the Takata air bag exploded, and the coroner had previously determined the rupture contributed to the death, NHTSA spokesman Gordon Trowbridge said.
In addition to the 10 fatalities, nine of them in the U.S., about 100 people have been injured by Takata air bags in the country.
Takata is in talks with rival air-bag maker Daicel Corp. on ways to ensure a stable supply of inflators, said Masahiko Hirokawa, a Daicel spokesman. No decision has been made about whether they will invest in a production joint venture, Hirokawa said. The proposed tie-up was earlier reported by the Nikkei newspaper.
The Nikkei also reported that Takata will separately seek aid from carmakers as recall costs mount, including getting them to cover some costs and easing pressure for discounts on parts.
“Takata has to share costs from the recalls to some extent,” said Ono of Japan Credit Rating Agency, which cut Takata to below investment grade in December. Even if the portion of recall costs Takata ends up being responsible for is small, it will result in a “huge” loss for the company because of the number of vehicles recalled, he said.