Takata rejects victims compensation fund

David Shepardson
Detroit News Washington Bureau

Washington — Embattled Japanese air bag manufacturer Takata told Congress it will not create a victims compensation fund to address exploding air bags linked to at least eight deaths and more than 100 injuries.

Takata Vice President Kevin Kennedy told Sen. Richard Blumenthal, D-Conn., that the company, which has declared air bags defective in more than 50 million vehicles worldwide, will not create a fund similar to one established by General Motors Co. to compensate victims of its faulty ignition switches. Blumenthal had suggested such a fund be created.

Kennedy said, "Takata's senior management has given the idea of a compensation fund careful consideration, and we will continue to evaluate the possible benefits of such a mechanism in relation to the personal injury lawsuits involving air bag ruptures and the multi-district litigation proceedings now pending in federal court in the Southern District of Florida.

"Takata has already resolved a number of claims involving air bag ruptures, and we intend to continue to discuss settlement of claims in appropriate cases going forward. At the present time, given the limited number of claims filed and the MDL procedures in place that permit the efficient coordination of related claims, Takata believes that a national compensation fund is not currently required."

Blumenthal blasted Takata.

"I am astonished and deeply disappointed by Takata's refusal to establish a victims compensation fund — even after 100 injuries and eight deaths attributed to its defective air bags, numbers almost certain to rise," Blumenthal said Friday.

"Takata is apparently unwilling to acknowledge its responsibility for these tragic deaths and injuries, or do justice for victims and their loved ones. I will press Takata to reconsider this callous misjudgment, and do right by the innocent victims of its harm."

Takata spokesman Jared Levy said the company is "committed to treating fairly anyone injured as a result of an inflator rupture. For that reason, Takata has settled a number of injury claims and will continue to do so based on the facts and circumstances of individual cases. ... we will continue to assess our position as we focus on how best to address the needs of individuals affected by an inflator rupture."

On Tuesday and Wednesday, NHTSA Administrator Mark Rosekind will hold events in Florida to highlight the need for owner to check if their vehicle has been recalled.

NHTSA is exercising unprecedented authority to coordinate the record-setting recall of about 32 million vehicles in the United States linked to defective Takata airbags. NHTSA is considering holding a public hearing this fall with the 11 automakers involved in the recall to talk about issues and ways of speeding up repairs.

Fiat Chrysler is adding another 88,000 vehicles to its recall with defective driver side air bag inflators. They include the 2008-10 Dodge Challenger. In total, Fiat Chrysler is recalling 4.8 million Takata inflators in 4.5 million vehicles in the United States — and 5.2 million worldwide.

At a hearing last month, Takata conceded that the number of deaths linked to the record-setting recall of about 32 million vehicles may rise. Kennedy told Blumenthal at the hearing that it is "probably likely" that a compensation fund would turn up additional incidents related to the defect.

The air bags can explode with excessive force and send shrapnel flying from the inflator.