Takata shares sink by a quarter, more car makers may snub inflators

After Honda, Mitsubishi and Fuji Heavy said they were thinking of switching away from Takata's air bag inflators

Shares in Japan's Takata Corp dropped by a quarter on Thursday as more automakers considered no longer using the company's air bag inflators, casting further doubt on the future of the parts supplier at the centre of a global recall crisis.

Japanese automakers Mitsubishi Motors Corp and Subaru-maker Fuji Heavy Industries Ltd said they were thinking about switching away from Takata's air bag inflators. Takata's biggest customer, Honda Motor Co, said a day earlier it would no longer use the component.

Air bag parts contributed 38% of Takata's total sales last year. The company reports its first-half results on Friday.

US regulators say Takata's inflators use a chemical propellant they suspect causes the air bag to explode with too much force, spraying metal shards into the car. The inflators have been linked to eight deaths, all in Honda cars, and have led to the recall of more than 40 million cars worldwide.

"We're thinking of not using Takata's inflators for future cars," Fuji Heavy CEO Yasuyuki Yoshinaga told reporters. He said Subaru may also look elsewhere for the inflators it needs to fix cars under recall as it was taking Takata too long to supply them.

Shares in Takata slumped 25%, or by their daily limit of 300 yen - to close at a 6-1/2-year low. In two days, some $330 million has been wiped from the company's market value.

The founding Takada family owns about 60 percent of Takata, while Honda holds 1.2%.

A Toyota Motor Corp executive said on Thursday the company continued to investigate Takata's air bag inflators and it remained committed to using "higher quality" components. He did not elaborate.

On Wednesday, Nissan Motor Co said it would defer to US regulators on actions related to Takata.

Takata said on Wednesday it would pay a $70 million fine imposed by the US National Highway Traffic Safety Administration (NHTSA) in instalments, and phase out - as ordered by NHTSA - the use of potentially volatile ammonium nitrate as a propellant in its air bag inflators.