Takata shares suspended ahead of expected bankruptcy

A crash-test dummy sits in a testing sled at Takata's current crash-testing facility August 19, 2010 in Auburn Hills, MichiganImage copyright
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Japanese car parts maker Takata is reported to be preparing to file for bankruptcy after its faulty airbags led to the biggest safety recall in automotive industry.

The filing could come next week in both Japan and the US, where it has a subsidiary and is seeking a buyer.

Shares of Takata were temporarily suspended on the Tokyo stock exchange because of the news.

Takata faces billions of dollars in liabilities over the recall.

So far about 100 million Takata airbags, which can rupture with deadly force and spray shrapnel at passengers, have been recalled globally.

The faulty airbags have been linked to at least a dozen deaths and more than 100 injuries worldwide.

More lawsuits likely

Japan’s Nikkei newspaper estimates the firm faces liabilities exceeding 1 trillion yen ($9bn; £7bn).

Takata has not commented on the reports in Japan, from sources close to the case, of imminent bankruptcy.

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Image caption

Takata CEO Shigehisa Takada has said he intends to resign

The company is said to be in talks about a potential deal with US auto parts maker Key Safety Systems. The latter may buy some of its assets under a restructuring plan.

In January, Takata agreed to pay $1bn in penalties in the US for concealing dangerous defects in its exploding airbags. It also pleaded guilty to a single criminal charge.

The firm paid a $25m fine, $125m to people injured by the airbags and $850m to carmakers that used them. But it still faces the possibility of more lawsuits.

Most major carmakers, including General Motors and Volkswagen, have been affected.

Honda Motor, which as Takata’s biggest customer is one of the worst affected, started recalling their popular Accord and Civic models in 2008 because of the airbags.

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