Japan's Kobe Steel data falsification scandal widens to more products_Business_Asia Pacific Daily

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Japan's Kobe Steel data falsification scandal widens to more products

Business2017-10-13

Kobe Steel Ltd. on Friday admitted to falsifying inspection data on nine other products, widening the scandal of the embattled steelmaker who said earlier in the day that it had shipped wire rods for automobiles that did not meet safety requirements. The latest revelations come on the heels of Kobe Steel Ltd. Chairman and President Hiroya Kawasaki warning a day earlier that there may be further cases of falsified data than have been previously disclosed. It came to light on Sunday that the steelmaker had falsifying data for its iron powder, aluminum and copper products that had been used by companies ranging from automakers and airplane manufacturers, to defense equipment and Shinkansen bullet train makers. Kobe Steel had already admitted that its products, with falsified data about their strength and durability, have been sold to around 200 companies globally. The depth of the scandal is so wide-ranging that the Japanese government has ordered the steelmaker to report the results of new safety checks within a fortnight. Kawasaki, who said on Thursday that no recalls on products will be made at the moment, said in his first public appearance since Sunday's revelations, that the results of safety inspections on shipped products would be made within two weeks and details of the firm's response to products undergoing false inspection data would be given. He added that the root cause of the extensive scandal, that has affected auto giants such as Toyota, Mazda and General Motors, would also be made known within a month. Kawasaki did not rule out the possibility that Kobe Steel might be liable for compensation claims. Investigations so far have shown that Kobe Steel knowingly shipped some 20,000 tons of aluminum and copper products with fabricated inspection data. The products were sent to around 200 companies. The beleaguered firm also said on Wednesday that an internal probe had revealed that 140 tons of iron powder shipped in fiscal 2016 did not meet customer specifications. It said one of its subsidiaries, Kobelco Research Institute, had falsified data related to the production method of liquid crystal displays, DVDs and other electronic equipment. In Japan, major railway operators Central Japan Railway and West Japan Railway have stated that their Shinkansen bullet trains contained aluminum parts sourced from Kobe Steel that did not meet industry standards. Beyond automakers and trains, Kobe Steel has also been implicated in fabricating data for aerospace and defense-related products. Kobe Steel was founded in 1905 and has been a bastion of Japan's manufacturing sector. The revelations of the data fabrication scandal, however, has cast doubts over corporate governance in the manufacturing industry and beyond in Japan, and cast serious aspersions over Japan's once stellar reputation for precision manufacturing. (ASIA PACIFIC DAILY)

Kobe Steel Ltd. on Friday admitted to falsifying inspection data on nine other products, widening the scandal of the embattled steelmaker who said earlier in the day that it had shipped wire rods for automobiles that did not meet safety requirements.

The latest revelations come on the heels of Kobe Steel Ltd. Chairman and President Hiroya Kawasaki warning a day earlier that there may be further cases of falsified data than have been previously disclosed.

It came to light on Sunday that the steelmaker had falsifying data for its iron powder, aluminum and copper products that had been used by companies ranging from automakers and airplane manufacturers, to defense equipment and Shinkansen bullet train makers.

Kobe Steel had already admitted that its products, with falsified data about their strength and durability, have been sold to around 200 companies globally.

The depth of the scandal is so wide-ranging that the Japanese government has ordered the steelmaker to report the results of new safety checks within a fortnight.

Kawasaki, who said on Thursday that no recalls on products will be made at the moment, said in his first public appearance since Sunday's revelations, that the results of safety inspections on shipped products would be made within two weeks and details of the firm's response to products undergoing false inspection data would be given.

He added that the root cause of the extensive scandal, that has affected auto giants such as Toyota, Mazda and General Motors, would also be made known within a month.

Kawasaki did not rule out the possibility that Kobe Steel might be liable for compensation claims.

Investigations so far have shown that Kobe Steel knowingly shipped some 20,000 tons of aluminum and copper products with fabricated inspection data. The products were sent to around 200 companies.

The beleaguered firm also said on Wednesday that an internal probe had revealed that 140 tons of iron powder shipped in fiscal 2016 did not meet customer specifications.

It said one of its subsidiaries, Kobelco Research Institute, had falsified data related to the production method of liquid crystal displays, DVDs and other electronic equipment.

In Japan, major railway operators Central Japan Railway and West Japan Railway have stated that their Shinkansen bullet trains contained aluminum parts sourced from Kobe Steel that did not meet industry standards.

Beyond automakers and trains, Kobe Steel has also been implicated in fabricating data for aerospace and defense-related products.

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

The revelations of the data fabrication scandal, however, has cast doubts over corporate governance in the manufacturing industry and beyond in Japan, and cast serious aspersions over Japan's once stellar reputation for precision manufacturing.

(ASIA PACIFIC DAILY)

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