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Takata Opens $850 Million Fund to Pay Carmakers for Airbag Woes
Takata Corp. has launched an $850 million fund in the U.S. to repay carmakers for a portion of their costs to recall Takata airbag inflators that can explode when triggered by a crash.
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Takata Corp. has launched an $850 million fund in the U.S. to repay carmakers for a portion of their costs to recall Takata airbag inflators that can explode when triggered by a crash.
More than 50 vehicle manufacturers are replacing at least 100 million of the inflators worldwide. Takata agreed in February to create the fund after pleading guilty in a federal court in Detroit to wire fraud. In July the court-appointed Eric Green, a mediator and Boston law professor, to manage the restitution program.
As “special master,” Green must calculate how to allocate the funds and recommend a plan to the court. Analysts have said the actual cost of the recalls, which are far from complete, has grown to tens of billions of dollars.
Green proposes to total the number of affected inflators purchased by each carmaker as of the end of 2016 and allocate the fund according to each manufacturer’s proportion of that total. He aims to provide a report in January to the court about the resulting payouts.
Green also will manage a separate, $125 million fund to compensate individuals who were injured or killed by the exploding inflators. That program hasn’t yet begun to accept applications.
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