Takata bankruptcy likely to shift $5 billion in costs to carmakers, suppliers

The expected bankruptcy of Japan-based automobile parts maker Takata Corp. may cause automakers to cover the difference if Takata's financial assets are not enough to pay for recalls and replacement of defective parts, Bloomberg reported citing sources. Scott Upham, president of U.S.-based Valient Market Research Inc., said that automakers and suppliers across the world face an estimated $5 billion in future costs tied to the recalls. A Takata asset sale will generate about $1.5 billion to $2 billion, Mr. Upham said.

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