New
Honda CEO says no plans to help air bag firm Takata fund
global recalls
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[July 06, 2015] By
Minami Funakoshi
TOKYO (Reuters) - Honda Motor Co's new
chief executive said the Japanese automaker has no plans for now to
provide financial aid to Takata Corp, the air bag supplier at the center
of a costly global safety recall that has dented Honda's public image as
well as its earnings.
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Speaking at his first news conference since taking the helm in June,
Takahiro Hachigo said on Monday Honda has now set aside enough this
year to cover the cost of recalling over 2 million cars with
potentially faulty air bag parts made by Takata. The automaker
recently restated last year's earnings to account for additional
costs.
"We have money budgeted for quality-related costs, as we did last
year, and we think we can respond within this allocated amount,"
Hachigo told reporters in the capital. Last month Honda revised its
operating profit for the year ended March to 606.88 billion yen
($4.92 billion) from the 651.68 billion yen it reported in April to
account for expanded recall costs.
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At 55, Hachigo, begins his stewardship of Japan's third-biggest auto
maker with a mission to restore the firm's reputation for quality.
In the Takata air bag safety scare regulators have linked eight
deaths to the component, all in cars made by Honda.
Hachigo's predecessor Takanobu Ito and other executives took a pay
cut last October following a fifth recall of its Fit hybrid
subcompact in a year, which had quality glitches unrelated to Takata-made
inflators.
In total, tens of million of cars carrying Takata-made parts have
been recalled around the world by a range of auto makers. Some
Takata air bag inflators have exploded with too much force, spraying
shrapnel inside vehicles, regulators have found.
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As Hachigo seeks to develop business, he said on Monday the company
remains open to alliances with other automakers - as long as such
tieups are of benefit to Honda.
In one such deal the Japanese firm already has an alliance with
General Motors Co to develop hydrogen fuel-cell technology.
Hachigo also said Honda began building cars in Africa this month by
retooling part of a factory in Nigeria that previously made
motorcycles. The company plans to produce 1,000 of its Accord sedans
annually at the plant, with a view to boosting production if the
local market grows.
(Additional reporting by Maki Shiraki; Editing by Kenneth Maxwell)
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