Miskolc plant awaits outcome of Takata bankruptcy

Automotive

Japanese car parts manufacturer Takata, the company at the center of the largest vehicle recall in history as a result of a string of deaths due to faulty airbags, has filed for bankruptcy protection in the U.S. and Japan, according to reports. The firm is a strategic partner of the Hungarian government, which supported the opening of its plant in Miskolc in 2014.

Takata Corporation has faced mounting costs from lawsuits and vehicle recalls after it emerged that faulty airbag inflators have caused as many as 16 deaths and 180 injuries. The resulting vehicle recalls affected some 42 million vehicles in the U.S. alone.

Hungarian daily Magyar Nemzet reports that cars containing the defective airbags had also ended up on Hungarian roads, as a result of which more than 15,000 Toyotas had to be recalled to the factory.

Takata pleaded guilty and must pay USD 1 billion in fines and compensation to both victims and carmakers, a burden which means the company is forced to sell. China-owned rival Key Safety Systems is reported to have offered USD 1.6 bln for the company, and to take over production of seat belts, airbags and other automotive safety parts. According to Hungarian online news portal index.hu, the prospective buyer has said it will not close any plants, one of which is located in Miskolc, northeast Hungary.

Takata concluded a strategic partnership with the Hungarian government, opening its factory in Miskolc in 2014 with support from the government of EUR 68 million, notes Magyar Nemzet.  Besides other things, the government agreed at the time to support the firmʼs investments in Hungary and promote exports of its products manufactured here.

For the time being, index.hu notes, the fate of the Hungarian plantʼs 1,400 workers is unknown, although Ákos Kriza, the Fidesz mayor of Miskolc, reportedly told Magyar Nemzet that the firmʼs situation is "currently stable" and that workers would begin negotiations with Takata in the wake of the bankruptcy news.

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