Takata's troubles could be opportunity for Chinese company

Ningbo Joyson Electronic Corporation is one of China's largest auto parts suppliers, and the company wants to become a serious player in the airbag market by taking advantage of Takata's current weakness. Joyson bought the American airbag maker Key Safety Systems for $920 million in February, and the Chinese firm has now decided to challenge other established businesses in the segment like Autoliv and ZF Friedrichshafen, according to Bloomberg.

Joyson sees Takata's airbag scandal as the perfect time to strike. "All of this has given us a heaven-sent opportunity to enter the industry. What was a market split among four is now shared among three players, so the opportunities naturally have increased a lot," Joyson CEO Tang Yuxin told Bloomberg.

Key Safety is among the companies supplying some replacement inflators for automakers' Takata recalls, and Joyson has plans for the division even after the campaigns end. For example, the Chinese company wants to develop tech for its drive control systems to work with the airbags to anticipate a collision and prep the safety devices.

Takata's weak position in the airbag market could last for at least a couple of years because of lost future business. Experts found the combination of ammonium nitrate as an airbag propellant, the inflators' assembly, and high-humidity conditions were to blame for the ruptures. Honda pledged not to use the company's inflators in future vehicles, and Ford, Toyota, and Mazda also promised not to use the firm's parts with this chemical in their models.

Takata posted profits last quarter despite the crisis. However, the company expects recall-related expenses to pile up and might consider selling off whole divisions to survive. Look for all of its competitors, including Joyson, to fight to gobble up as much former Takata business as possible in the near future.

Related Video:

Share This Photo X