Money-losing Japanese air bag maker Takata Corp. hired financial advisory and asset management firm Lazard on Thursday to help tackle financial problems and massive recalls. Takata air bags can deploy with too much force, spewing shrapnel into the vehicle. They are responsible for at least 11 deaths and more than 100 injuries worldwide. Authorities in Malaysia have begun an investigation into two more recent deaths. Hideaki Sudo, a lawyer who heads the committee at Takata dealing with the recall fiasco said Lazard will help with restructuring in partnership with its auto customers. The committee, which also includes four other business, legal and financial experts, was formed in February to develop a restructuring plan.
The recalls have been growing and may reach more than 100 million inflators. Many automakers have said they will stop using Takata air-bags in models under development, and they will be billing Takata for the recall costs, which are certain to balloon. The company is also certain to face class-action lawsuits. Because of the sheer numbers involved, it will take years to manufacture replacement parts. Tokyo-based Takata, which also makes seat belts, has sunk into red ink for the last two fiscal years over the recalls, racking up a loss of 13 billion yen ($120 million) for the fiscal year that ended in March, largely due to recall-related costs.
Takata said it is seeking new investment and improving the company's governance and transparency. It has repeatedly said it is trying to determine the root cause of the inflator problems to come up with fixes. The recalls have been ordered because regulators feel the inflators are too dangerous to wait until that is pinpointed. Earlier this month, the U.S. National Highway Traffic Safety Administration added up to 40 million Takata air bags to the ongoing recall of 28.8 million air bags.