Daimler Sees $384 Million Expense for Takata Air-Bag Recallby
Company repairing 841,000 Mercedes-Benz cars, Daimler vans
Expense cuts net income to 8.7 billion euros for 2015
Daimler AG said recalling about 841,000 vehicles to fix potentially defective Takata Corp. air bags will cost the German automaker about 340 million euros ($384 million) and cut into the profit it reported last week for 2015.
The automaker will repair about 705,000 Mercedes-Benz cars and 136,000 Daimler vans, according to a company statement. The cost of replacing Takata’s air bags, already the largest consumer-safety recall in U.S. history, reduces group net income for last year to 8.7 billion euros from the 8.94 billion euros outlined on Feb. 4.
Daimler is joining automakers including Honda Motor Co. and Ford Motor Co. in widening air-bag recalls following the ninth U.S. fatality tied to Takata’s safety devices. Volkswagen AG said Wednesday it will also recall about 680,000 vehicles, and BMW AG announced a 840,000-car recall, both due to the air-bag issue. The Japanese supplier’s inflators can deploy with too much force and rupture, spraying plastic and metal at vehicle passengers.
Daimler rose 0.3 percent to 59.30 euros in Frankfurt. The shares have dropped 24 percent this year.
Honda said last week that it will recall an additional 5.7 million vehicles globally, including 2.2 million in the U.S. Also included in the latest recalls were Mazda Motor Corp. and Saab Automobile.