Japan’s Takata Corp decided on Monday to file for bankruptcy protection in Japan with liabilities of more than 1 trillion yen (US$9 billion), Japanese media reported, as the auto parts supplier has struggled due to its defective air bag inflators at the center of the auto industry’s biggest ever product recall.
The decision came at a special board meeting, public broadcaster NHK said.
Takata is expected to file for a U.S. Chapter 11-style bankruptcy protection procedure, along with a similar filing in the United States, sources have told Reuters. This would open the door for a financial rescue from U.S. auto parts supplier Key Safety Systems, which Takata has tapped as its preferred financial sponsor.
Faulty air bag inflators made by Takata have been linked to at least 17 deaths in the United States and other countries, prompting a massive global recall which began nearly a decade ago.