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How Much Will It Cost To Fix All the Takata Airbags?
The Takata airbag defect has injured over 100 people. In addition, it has led to the deaths of 15 people worldwide, including 10 deaths here in the United States. That’s why the USA has become ground zero for the largest recall in automotive history, but have you ever wondered just how much it will cost to make this recall happen?
How Much Will It Cost To Fix Takata Airbags?
The cost of fixing the Takata airbag recall could be staggering. Early estimates were in the $7 billion range, but the recent expansion could change that. Since the National Highway Traffic Safety Administration (NHTSA) expanded the recall to include all of Takata’s ammonium nitrate inflators that do not contain a drying agent (known as a “desiccant”), the estimated recall price tag has inflated to $24 billion. This is the worst case scenario for the embattled company, but there may be a way out.
How Will Takata Pay For The Recall?
The Japanese auto parts company is relying on the kindness of their customers. And by customers we are talking about the auto manufacturers that use Takata parts. Daimler Auto Group recently set aside $560 million to handle the recall, but this company isn’t Takata’s biggest customer. Honda, Toyota, Ford, and other companies have a wide range of models that use these airbags too. Each of these car companies is expected to foot the bill for the recall. However, many experts expect that Takata will still be on the hook to pay them back. This is creating new financial worries at the company’s headquarters.
Business sources say that right now Takata is trying to find a buyer for the company. The chief executive of the company has plans to step down, which will allow new management to take control. This could make the company a better sell, but the cost of the recall is becoming a big liability.