Industry News: Takata Files For Bankruptcy, Sells Off Assets To Another Supplier

[William Maley]

Airbag manufacturer Takata is at the center of one the largest automotive recalls which affect an estimated 100 million vehicles from two dozen automakers around the world. The airbags in question have inflators that can rupture and send shrapnel flying in the event of a crash. They have been linked to at least 16 deaths and 180 injuries. Now, the next chapter begins as Takata filed for bankruptcy.

Yesterday, TK Holdings (Takata's U.S. operations) filed for Chapter 11 bankruptcy in Delaware on Sunday with liabilities totaling between $10 billion to $50 billion. The company would file for bankruptcy in Japan today.

Takata also announced that it would be selling its key assets to Key Safety Systems, a Michigan-based supplier owned by China's Ningbo Joyson Electronic Corp. The purchase will cost Key $1.6 billion.

At a press conference today in Tokyo, CEO Shigehisa Takada said the company had no choice to sell their assets due to liabilities increasing and finances collapsing.

"We spent much time on negotiations, it was extremely difficult to reach an agreement with more than 10 carmakers worldwide and a sponsor candidate company," said Takada.

"If things are left as is, we are aware of risks that we may not able to raise fund and to continue stable supply of products. In light of the management environment we face, the state of negotiations with the sponsor candidate and carmakers, and the external expert committee's opinion, we have decided today to file for bankruptcy protection."

Takata attorney Nobuaki Kobayashi said the total amount of liabilities was still unknown and the company is in talks with automakers to figure out the worldwide cost. According to Automotive News, analysts put potential liabilities as high as $10 billion for ongoing recalls, penalties and settlements. A report from Tokyo Shoko Research Ltd., puts Takata total liabilities at 1.7 trillion yen (about $15 billion).

Back in February, Takata pleaded guilty to wire fraud charges in the U.S. for withholding key information about the defects and manipulating test data. 

Source: Automotive News (Subscription Required), Reuters

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[G. David Felt]

Dead Man Walking, Takata, this cost will hit all automakers and it will hurt.

[A Horse With No Name]

China will own everything, one reason Ford is beneath my lowest level of concieveable contempt right now for outsourcing the Focus to China.

This will not end well for a number of reasons.

[daves87rs]

2 hours ago, A Horse With No Name said:

China will own everything, one reason Ford is beneath my lowest level of concieveable contempt right now for outsourcing the Focus to China.

This will not end well for a number of reasons.

I was mad, but also realized how bad the small car market is going to take in the next year or so. GM is going to wish they could build the Cruze in mexico! I was hateful at first too-but the auto market is about to take a sharp hit soon. They will have to save money any way they can.

As much as I hate the idea of chinese focuses, it is a way to save....

 

And as far as the above company-just goes to sound many, many OEM parts will be made in China soon....

[oldshurst442]

5 hours ago, William Maley said:

Takata attorney Nobuaki Kobayashi

And with this bankruptcy my guess is you will never hear this mess again...

What a second....Ive heard this before...

Oh yeah!

 

Edited June 27, 2017 by oldshurst442

[riviera74]

What makes you think that many OEM parts are not already made in China?  It's all about cost containment and profitability.

[A Horse With No Name]

1 hour ago, riviera74 said:

What makes you think that many OEM parts are not already made in China?  It's all about cost containment and profitability.

They are made in China which is quite frankly disgusting...

[riviera74]

6 hours ago, A Horse With No Name said:

They are made in China which is quite frankly disgusting...

So how do we solve that issue without starting a nasty and counterproductive trade war?

[Robert Hall]

Not sure if you can undo the trade imbalance and globalization...companies are too entrenched...most all consumer electronics are assembled in China or elsewhere in Asia, some using chips manufactured in the US.  Parts are sourced from all over.   I do wonder if we have gone so far as a country in outsourcing various parts of the supply chain that we can't go back to building a lot of things here, at least not easily..

[A Horse With No Name]

37 minutes ago, riviera74 said:

So how do we solve that issue without starting a nasty and counterproductive trade war?

That is the sixty four million dollar question. 

32 minutes ago, Cubical-aka-Moltar said:

Not sure if you can undo the trade imbalance and globalization...companies are too entrenched...most all consumer electronics are assembled in China or elsewhere in Asia, some using chips manufactured in the US.  Parts are sourced from all over.   I do wonder if we have gone so far as a country in outsourcing various parts of the supply chain that we can't go back to building a lot of things here, at least not easily..

I think more things need to be made here but I am more concerned about Chinese human rights violations than about trade. Maybe we could get some sort of enforceable human rights agreements to go with the trade agreements our leaders seem so eager to sign.

[Robert Hall]

14 minutes ago, A Horse With No Name said:

That is the sixty four million dollar question. 

I think more things need to be made here but I am more concerned about Chinese human rights violations than about trade. Maybe we could get some sort of enforceable human rights agreements to go with the trade agreements our leaders seem so eager to sign.

Unfortunately, human rights are at the bottom of the priority list for global corporations, the current administration and Congress... (my cynical opinion...some say I'm a pessimist, I prefer 'realist').

Edited June 28, 2017 by Cubical-aka-Moltar

[A Horse With No Name]

Just now, Cubical-aka-Moltar said:

Unfortunately, human rights are at the bottom of the priority list for global corporations, the current administration and Congress...

Which leads me into an ugly double bind....I feel better about buying Chinese than buying American made products given what you just wrote.

My Dryer broke and parts to fix it are more than it is worth...thinking of buying Samsung or something for that very reason.

[G. David Felt]

16 hours ago, A Horse With No Name said:

Which leads me into an ugly double bind....I feel better about buying Chinese than buying American made products given what you just wrote.

My Dryer broke and parts to fix it are more than it is worth...thinking of buying Samsung or something for that very reason.

Hold off on buying Samsung appliances. My sister and Brother in law have their own appliance repair business and Samsung appliances are notorious for breaking down and not being able to get repair parts.

They say the most reliable long life for Washer / Dryer or dishwasher but also other appliances would be Bosche. If you want more than a 1yr warranty 90 days labor which is what comes pretty much on all appliances, then look at Speed Queen. 3yr parts n labor warranty. Commercial grade built for residential and they just work.

Good Luck,

[A Horse With No Name]

Thanks for your advice...have not had the best of luck with Bosch dishwashers...speed queen it might be...!

[G. David Felt]

1 hour ago, A Horse With No Name said:

Thanks for your advice...have not had the best of luck with Bosch dishwashers...speed queen it might be...!

Sorry to hear about the Bosch as both my sisters, my parents and me have them and have had no problem with them. What is the current problem and I can talk to my brother in law and see what he says?

[A Horse With No Name]

20 minutes ago, dfelt said:

Sorry to hear about the Bosch as both my sisters, my parents and me have them and have had no problem with them. What is the current problem and I can talk to my brother in law and see what he says?

Control board is out of my dishwasher and it is an older dish washer. I think the GE dishwasher that matches our fridge and stove is American made....only issue with the Bosch is that it will not latch and is stuck in regular wash cycle.  using woodworking clamps to keep it shut is a red-green-ish hill billy hack but it cleans dishes flawlessly...

Checking into Speed Queen...as mad as i get politically at both parties...and at the country...I will buy American when they build an excellent product. I love Sierra Nevada Beer and several other American manufacturers.

Speed queen...asked around a bit...checked a few things out...they seem like well made appliances. Will have to seriously consider them, as everything else on the market seems like expensive junk.

Thanks for your help!

Edited June 28, 2017 by A Horse With No Name