The daily business briefing: June 26, 2017
Takata files for bankruptcy protection, Trump and Modi head into meeting on trade and other issues, and more
Troubled air bag maker Takata files for bankruptcy
Japanese auto-component maker Takata Corp. filed for bankruptcy protection late Sunday, after failing to bounce back from its massive air bag inflator recalls. The company's defective inflators, which can explode and blast shrapnel into vehicle interiors, have been blamed for 16 deaths and 180 injuries, setting off the largest automotive recall in U.S. history. More than 100 million inflators have been recalled — 69 million of them in the U.S. — affecting 42 million vehicles. A Chinese-owned U.S. rival, Key Safety Systems, plans to buy most of Takata's assets in a $1.6 billion deal. Key Safety Systems will take over Takata's production of seat belts, air bags, and other safety devices.
Trump, India's Modi to meet Monday in Washington
President Trump and Indian Prime Minister Narendra Modi will meet Monday in Washington, D.C., for their first face-to-face talks. Trump and Modi disagree on several major issues. Trump, who campaigned on an "America First" theme, has criticized the growing U.S. trade deficit with India, and accused the country of underhandedly pushing for the Paris climate agreement to collect billions of dollars in aid. Indian officials have rejected accusations that Modi's "Make in India" platform is protectionist, and complain that U.S. regulations hinder some Indian exports. A Trump administration official told Reuters that the two leaders' shared affinity for social media — both have more than 30 million Twitter followers — show they have much in common, and could form a bond. Another senior White House official said the administration is "very interested in making this a special visit. We're really seeking to roll out the red carpet." An Indian official told Reuters "if the chemistry is good, everything else gets sorted."
Italy commits billions to help liquidate 2 failed banks
Italy, hoping to avert a broader banking crisis, announced Sunday that it was committing up to $19 billion to pay the country's biggest retail bank, Intesa Sanpaolo, to take over what's left of two failed regional banks, Popolare di Vicenza and Veneto Banca, after they collapsed due to mismanagement and bad loans. The government will pay Intesa $5.8 billion and give it guarantees of $13.4 billion. The deal, which was approved by the European Commission, wound up involving three times more government money than initially estimated, but it will let Italy handle the matter itself rather than submitting to tougher European rules. "Those who criticize us should say what a better alternative would have been. I can't see it," Economy Minister Pier Carlo Padoan said.
China sentences 3 Australians to prison for gambling promotion
A Chinese court sentenced three Australian employees of Crown Resorts to up to 10 months in prison after finding that they illegally promoted gambling. The employees included Jason O'Connor, the company's vice president of V.I.P. international operations, who received a 10-month sentence. The other two Australians were sentenced to nine months. Twelve Chinese employees and one Malaysian got similar sentences. The defendants have been detained since October, so with the time already served they should be released in a few months, but the case has scared foreign gambling operators that have been trying to attract customers from China with free flights on private jets and other enticements.
3 biggest producers boost coal mining after 2016 decline
The U.S., China, and India — the world's biggest coal users — have increased coal mining so far in 2017, marking a swift turnaround after a global decline last year. The Associated Press found in a review of mining data from January through May that coal production rose by at least 121 million tons, or 6 percent, over the same period last year in the three countries. The U.S., where President Trump is promising to revive the coal industry, saw the biggest jump, with a 19 percent increase, according to data from the Energy Department. Coal's popularity has fallen in recent years as cleaner sources of power, including natural gas and renewable sources such as solar, gained popularity, and China attempted to reduce dangerous urban smog levels blamed largely on coal burning.