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Takata says has sufficient funds to deal with recalls - Nikkei

Published 18/12/2014, 02:27
© Reuters. Takata Corp's company plate is seen at an entrance of the building where the Takata Corp headquarters is located in Tokyo
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TOKYO (Reuters) - Air bag maker Takata Corp <7312.T> has sufficient funds to deal with a global recall that has climbed to about 21 million vehicles after five deaths linked to its products, the company executive told the Nikkei newspaper.

Takata CEO Shigehisa Takada, the grandson of the company founder, said it was analysing collected inflators to determine the cause of defects with its air bags, which can explode with excessive force and spray shrapnel into cars.

Takada, whose family owns nearly 60 percent of the company, has not made a public appearance since an annual shareholder meeting in June. The chief executive told the newspaper he was not intentionally avoiding the public but was directing the company's response to the crisis.

"Takata is prioritising the supply of replacement parts. We have sufficient funds put aside, and we are not concerned that we are under-capitalised. We will take steps on the financing side if needed," he told the newspaper on Wednesday.

The deaths, four in the United States and one in Malaysia, have all been in Honda Motor Co (T:7267) cars fitted with Takata air bags.

Takata has so far put aside $774 million (£496 million) to deal with recalls, but it faces dozens of class-action lawsuits as well as a U.S. criminal investigation.

Takata has identified and corrected manufacturing problems, including mismanagement of ammonium nitrate, a chemical that has been used in its air bag inflators since 2000, Takada said. The company was analysing around 100 inflators a day to determine a cause for the defect, he said.

The Tokyo-based auto safety parts maker is ramping up production of replacement inflators at its factory in Mexico, but U.S. and Japanese regulators and major automakers have expressed concerns there will be a shortage of the parts to meet the huge recall.

© Reuters. Takata Corp's company plate is seen at an entrance of the building where the Takata Corp headquarters is located in Tokyo

Shares in Takata were up 3.6 percent in Tokyo's morning trade, compared with a 2.5 percent gain on Nikkei's benchmark average (N225). The company's stock is still down 56 percent since January.

(Reporting by Mari Saito; Editing by Will Waterman)

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