Published: Fri, October 13, 2017
Science | By Eileen Rhodes

Kobe Steel aluminium tampering scandal could impact its products, Toyota says

Kobe Steel aluminium tampering scandal could impact its products, Toyota says

Several vehicle manufacturers have launched investigations after supplier Kobe Steel admitted falsifying data for some of its aluminium and copper products. Ford and GM said Thursday they are investigating any potential impact.

In Japan and overseas, manufacturers that have used Kobe Steel materials have been racing to check that the safety of their own products has not been compromised.

"Products used [for both Japanese and British trains] met safety standards". A government spokesman on Wednesday criticized the apparently widespread falsification of data as "inappropriate", saying it could undermine product safety.

"We will make efforts to regain trust as soon as possible", the companies president Hiroya Kawasaki said to reporters after a meeting with the ministry.

West Japan Railway Co, which runs services from Osaka to Fukuoka, also found substandard parts made by Kobe Steel.

It is the latest in a string of quality control and governance scandals to hit major Japanese businesses in recent years, undermining the country's reputation for quality.

They include cases of falsified data at Nissan Motor and Mitsubishi Motors, while air bag maker Takata filed for bankruptcy in June over faulty airbags which were blamed for several deaths and many injuries.

Earlier this month, Nissan recalled all 1.2m new cars it sold in Japan over the past three years after discovering that final vehicle inspections had not been performed by authorised technicians.

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Kobe Steel was founded in 1905 and has been a bastion of Japan's manufacturing sector.

"Nothing in our review to date leads us to conclude that this issue presents a safety concern", it said.

However, it declined to comment on a media report that materials used in semiconductors were also impacted by the scandal.

Kobe Steel spokesman Gary Tsuchida told the BBC the firm regrets the falsification of data.

But Mazda said it was still investigating after it used Kobe aluminium in some auto bonnets.

Kobe Steel said it would work with its customers to ascertain "the impact of the nonconforming products on quality (including safety) of the end products".

While there have not been any reports that Kobe Steel products posed safety risks, the company is likely to face lawsuits from investors, customers, consumers and regulators in Japan and U.S., experts say. "Kobe Steel's technology is not something easily substitutable by others, and existing customers have nowhere else to go", said Yasuo Sakuma, Chief Investment Officer at Libra Investments in Tokyo.

Since then the embattled firm has seen its shares plunge almost 40% - wiping more than $1.5bn (£1.1bn) off its market value.

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