Is survivability at stake for Takata after record recall? image

Japan’s Takata Corp. has recently announced the historic recall of almost 34 million vehicle equipped with the supplier’s potentially deadly airbag inflators – the biggest ever safety campaign for a singular defect across the US auto industry.

The automotive industry is, order unlike other sectors, very protective of its companies – as automakers showed by largely standing up behind airbag component producer Takata as their own reputations were also smeared after the relentless and seamlessly never ending series of recalls affecting the Japanese company’s components starting way back in 2008. The reason is simple – Takata rules over around 25 percent of the market for airbag components, a crucial element in any modern vehicle – leaving little option to the ten (now eleven) affected automakers. But that loyalty could see further pressure as Takata has initiated the biggest recall of any US product, ever. And the tally could rise further as there are numerous pending investigations of the airbags, trying to determine the root cause of the flaw.

Other analysts and industry experts go as far as to say Takata might not survive the impact of the record recall. “It’s a complete nightmare,” says Jochen Siebert, managing director at JSC Automotive Consulting. “I just don’t see how Takata can survive this.” The recalls have ben going on since 2008, with the airbag inflators prone to rupture, after exploding with too much force and sending metal shrapnel inside the cabin at high velocity – six deaths have been linked to the defect and more than one hundred injuries. Takata and three other competitors together have command of around 80 percent of the global market for airbag inflators, with Sweden’s Autoliv and Japan’s Daicel now ready to claim market share from the crisis-hit supplier.

Via Bloomberg