Toyota Motor Corp is looking forward to avoid risk from potentially lethal air-bag inflators supplied by Takata Corp by buying millions of them from smaller parts maker Kayaku Co. Globally, Toyota has recalled 12 million vehicles for defective Takata airbags.
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Nippon Kayaku inflators are meant for replacement of the high-risk ones with newer inflators.
Takata airbags, if you do not recall, have been associated with at least 8 deaths and more than 100 injuries after they had exploded (instead of properly inflated) with excessive force, which sprayed shrapnel throughout the vehicles.
The recall is due to a defect in air-bag inflators that Takata made. Shares of the company were up more than 2.9% after the report about the air bags was released.
The sources declined to say how much the purchases would cost Toyota, but average inflator prices suggest a total of around $100-$150 million.
Toyota considers a switch to Nippon Kayaku inflators to be precautionary, in case further recalls are required, said the person with direct knowledge of the deal. Automakers, including Toyota, are bearing the high cost of the recalls while the cause of the problem is investigated.
Lawmakers in the United States have urged Takata to recall immediately all cars equipped with the company’s airbags, a demand that could affect more than 50 million cars on US roads.
After being criticized for acting too slowly on a separate major recall crisis of its own five years ago, Toyota, which vies with Volkswagen as the world’s biggest carmaker, wants to be able to replace at-risk inflators promptly if it needs to, the sources said. It is not clear however if Toyota would be cutting off all business deals with Takata but this is highly unlikely. Still, the sources stressed that Toyota may still continue buying Takata-branded inflators, as the automaker “won’t do anything to crush” its longtime supplier.
Nakanishi adds that even if Takata’s inflator business were to end, the company still has other options, according to Reuters.
The Japanese carmaker asked the second-tier supplier last month to ratchet up production so that it could supply Toyota with over 13 million inflators from next July until 2020, a person with direct knowledge of the deal and a second individual who was briefed on it said.
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Daicel finance previously received help from Honda Motor Co to increase production to meet demand for replacement air bags.
