Takata Corporation has officially filed for Chapter 11 bankruptcy as it continues to try and contain the fallout from the automotive industry’s largest recall ever. Takata has ordered 100 million of its airbags be recalled, which are found in numerous vehicles across multiple brands.
Takata reportedly filed for Chapter 11 bankruptcy with liabilities totaling more than $9 billion, according to Reuters. The decision now opens up U.S. supplier Key Safety Systems to swoop in and rescue the Japanese company through an outright purchase. Takata must continue manufacturing replacement airbag inflators.
Not only does Takata face million of dollars in fines after it misled the auto industry for 15 years, but it has billion of dollars in lawsuits pending from its clients. Not to mention, class action lawsuits in the U.S. and other countries as well. Takata previously plead guilty to fraud and expressed “deep regret” over its decisions. It agreed to pay a $1 billion fine.
The airbag manufacturer used explosive chemical ammonium nitrate to inflate air bags instantly in a crash, but the chemical compound was found to deteriorate when exposed to moisture. This would, in turn, spray deadly shrapnel at the faces of crash victims. The defect has been linked to 17 deaths and 180 injuries worldwide thus far.
GM has issued safety recalls for multiple vehicles that could house the faulty airbags and more recently issued a preliminary safety recall for additional vehicles. It should be noted no injuries or deaths have occurred in GM vehicles equipped with Takata airbags, however.