Takata Won’t Bolster Cash Reserves for Expanding Airbag Recalls

This week Japanese carmakers said they will recall another 11.5 million vehicles to replace Takata Corp. inflators that could explode. But the supplier tells analysts it sees no reason to set aside more cash to pay for the new campaigns.

Takata's reason: Government safety agencies didn't officially order carmakers to launch the recalls.

At least 10 carmakers have called back some 14 million cars in the past two years alone to replace Takata inflators that can explode and spray shrapnel into the passenger compartment. In February Takata said it had allocated some 5 billion yen ($429 million) to cover the cost of the campaigns.

Takata conceded at the time it was impossible to predict the eventual cost of the recalls, including legal settlements. The company predicted two weeks ago it will post a net profit of 20 billion yen ($167 million) in the fiscal year that began April 1.