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Daimler to recall vehicles in US and Canada as precaution following Takata airbag issue

ABR Staff Writer Published 20 May 2016

Daimler is making arrangements to recall its vehicles with Takata airbags in US and Canada on precautionary basis.

In early May, the US National Highway Traffic Safety Administration (NHTSA) disclosed extensions of the recall to be carried out by airbag manufacturer Takata.

According to this information, Takata has agreed to declare 35 to 40 million modules of front-passenger airbags without drying agent in the United States as being defective, and will recall them over the period of May 2016 to December 2019 in several stages.

We are not aware of any cases of the defect that Takata has recognized in an airbag inflator in our vehicles worldwide. The safety of our customers has the highest priority for us.

Certain front-passenger airbags from Takata are installed in vehicles sold by subsidiaries of the Daimler Group in the United States and Canada. Therefore appropriate precautionary recalls will be done in the mentioned timeframe for certain models.

Daimler AG will recognize a provision in the mid hundreds of million euros in the financial year 2016 in connection with the extended recall of airbags by the supplier Takata in the United States and Canada.

The anticipated expense will not affect earnings from the ongoing business and will be reported separately.

The negative impact on the cash flow caused by the recalls will be spread over the mentioned timeframe and will be minor for 2016.

Daimler AG continues to assume that Group EBIT from the ongoing business will increase slightly in 2016.

Source: Company Press Release