Takata Corporation, a Japanese automotive parts company, is brought down by the huge cost of its exploding airbag crisis. Takata's faulty airbag inflators which can blast shrapnel into drivers, as well as passengers, have resulted in a major recall of tens of millions of vehicles. It has been also linked that it resulted in a record of 11 deaths in the U.S. and numerous others elsewhere.
With spiraling liabilities estimated at more than $9 billion, Takata stated on Monday that the car apparels company is seeking bankruptcy protection in Japan and in the United States. According to CNN, Takata is also selling off the lion's share of its market to a U.S.A.-based rival company.
A Chinese-Owned company named as Key Safety Systems is willing to pay $1.6 billion for nearly all of the operations of Takata. However, it's staying away from the portions of the deal with the airbag inflators, which will give wound to the company soon. "We caused troubles for our supporters, those who cooperated with us and the creditors," Chairman Shigehisa Takada said on Monday at a news conference where he bowed before the medias and cameras. "On behalf of Takata, I apologize deeply from the bottom of my heart."
As reported by Reuters, most of Takata's obligations and responsibilities are owed not to the victims but to automakers for recalling and restoring millions of its air bags. In fact, the Japanese suppliers are restructuring their plans to rely heavily on financial support from its customer. Several personal injury lawyers announced that Takata Corporation had made too many concessions to other automakers, without investigating the value of their rights.
As a matter of fact, lawyers of TK Holdings and General Motors Co. argued about the need of fund in order to outweigh the investigation of the other car companies, which could happen later on. "I will figure that out in due course, but I’m not doing that today," U.S. Bankruptcy Judge Brendan Shannon said.