Toyota Motor Corp. will be buying millions of air-bag inflators from Nippon Kayaku Corp., in an attempt to reduce the risk from potentially lethal airbag inflators from Takata Corp., people familiar with the matter told Reuters.
Toyota plans to buy more than 13 million inflators, by July of 2016 until 2020, to Nippon Kayaku, a smaller rival of Takata.
The source, who asked not to be named because discussions are confidential, told Reuters that Toyota has asked Nippon to increase its production facilities. A second individual, who was briefed on the deal, confirmed the source's report.
The increase in Nippon Kayaku's facilities is to accommodate Toyota's demands.
The people said that Toyota is basing the number of inflators it will purchase from Nippon Kayaku to the number of cars with the Takata-made inflators that the company thinks could become dangerous, according to Reuters.
The inflators become more dangerous as the car ages.
Nasdaq added that Toyota was forced to adopt this strategy, after 10 automakers were forced to recall tens of millions of vehicles since 2008.
The recall is due to a defect in air-bag inflators that Takata made.
Reuters adds that Takata's inflators have been linked to eight deaths and 100 injuries after exploding with excessive force.
The explosion, which usually happens in crashes, shoots metal fragments inside the vehicle.
Takata said that the cause of their airbag's sudden explosion, long-term exposure to heat and humidity, according to Reuters.
The cars that were recalled so far is at least five years old.
Nasdaq added that the authorities in the U.S. have ordered the immediate recall of all vehicles using Takata's airbags.
It is estimated that, presently, 50 million vehicles use airbags made by Takata.
Takaki Nakanishi, chief executive of Nakanishi Research Institute, told Reuters that the move does not mean that the company will be ending its business with Takata.
"This is a strategy where it's trying to maintain business and reduce risk," he said.
Nakanishi adds that even if Takata's inflator business were to end, the company still has other options, according to Reuters.
"It can certainly still survive as an airbag maker if it buys inflators from other companies," he said.
