Japanese auto supplier Takata is reportedly readying a potential bankruptcy filing after a crushing scandal that sapped its finances, triggered the largest automotive recall in U.S. history and spawned fines and investigations.
Takata’s exploding air bag scandal has cast a cloud of uncertainty over the company, whose Michigan-based subsidiary TK Holdings is said to be weighing a Chapter 11 bankruptcy filing, according to Japanese newspaper Nikkei.
The company is still pursuing an “out-of-court reorganization” to “ensure its parts-supplying operations remain ongoing,” Nikkei reported Thursday.
But the outlet reported that Takata’s biggest customer, Honda, as well as Japanese automaker Toyota and other customers are “believed to be leaning in favor” of bankruptcy.
Takata has been conducting negotiations with its key customers in a bid to share the steep costs associated with the largest automotive recall of all time. The defective air bags — which can explode in a collision, hurling fiery shrapnel into passengers — have killed more than a dozen people and injured more than 100.
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SOURCE: USA Today, Nathan Bomey