Takata logs $120mn loss in recall crisis

Tokyo / AFP

Scandal-stricken Takata said on Wednesday it logged an annual net loss of $120 million, as the company struggles with a massive recall crisis over exploding air bags tied to 13 deaths in the United States and Malaysia.
US auto safety regulators last week ordered Takata to recall between 35 million and 40 million airbags installed in US cars, in a push for the replacement of dangerously explosive inflators.
The decision came after the National Highway Traffic Safety Administration concluded that the inflators are prone to ruptures, adding to nearly 29 million Takata airbags already recalled in the US.
Some 50 million have been recalled globally.
In the business year to March, Takata said it reported a net loss of 13.08 billion yen ($120.3 million) after several forecast downgrades.
The company posted a special loss linked to the airbag recall problem, including a penalty levied in the United States, it said in a statement.
It had originally expected a net profit of 5 billion yen for fiscal 2015, while logging a net loss of 29.56 billion yen a year earlier.
The company, however, said it is forecasting net profit of 13 billion yen in the current fiscal year to March 2017, but did not initially offer an explanation for the optimistic expectation.
US investigators have tied accidents in which airbag inflators ruptured, sending shrapnel into car drivers and passengers, to the deterioration of the inflators’ ammonium nitrate propellant under high humidity and fluctuating heat conditions.