Takata shares fall after US senators called for a criminal probe

Article by Christian A., on November 12, 2014

The current airbag recall scandal surrounding Takata Corp. is taking a heavy toll on the supplier’s shares. In fact, Takata’s shares dropped 17 percent at close of trading on Monday to JPY1,177 in Tokyo Trading just after lawmakers in the United States called for a criminal probe against the company.

As of November 10, 2014, Takata’s shares have dipped 61 percent for the year. US senators recalled called for the Department of Justice to launch a criminal investigation following a report saying that Takata secretly tested its airbags in 2004, and then deleted test data and disposed of failed parts despite finding flaws and beginning work on a recall.

The report was published in The New York Times, citing interviews with two former Takata employees. Sens. Richard Blumenthal (D-Connecticut) and Edward Markey (D-Massachusetts) said in a statement that if the reports are true, Takata should be held accountable for the deaths and injuries caused by its wrongdoing.

The senators said that the allegations against Takata are “credible and shocking” that warrant “a prompt and aggressive criminal probe.” The company disputed the report, saying that the allegations of the former employees were fundamentally inaccurate. Takata also noted that Al Bernat is still with the company.

The report said that Bernat was the former Takata executive who supervised the airbag tests in 2004.

Takata said in an e-mailed statement to Bloomberg that it is cooperating with the government investigation under way. The US National Highway Traffic Safety Administration has given the company until Dec. 1 to answer questions under oath and submit documents that details its handling of the airbag issues since 2000. The faulty airbags have been tied to four deaths and the recall of 7.8 million vehicles in the US.

Topics: takata, airbag, recall

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