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Bullet Train Wheel Parts Made By Kobe Steel Failed Quality Tests

Bullet Train Wheel Parts Made By Kobe Steel Failed Quality Tests

Top Japanese carmakers said Wednesday they were scrambling to assess the safety of vehicles containing products from Kobe Steel, which has admitted falsifying quality data in a growing scandal.

There was a single case of data tampering of iron powder products the company said, along with 70 cases of data tampering at its research unit Kobelco Research Institute Inc.

Shares in Kobe Steel fell by almost 40% in two days, wiping more than $1.5bn (£1.1bn) off its market value after the firm admitted fabricating data about the strength and durability of products it delivered to more than 200 companies. "But they did not meet the specifications that were agreed between us and Kobe Steel", a Hitachi spokesman told AFP.

The Kobe Steel scandal broke on Sunday when the manufacturer first admitted falsifying data linked to the strength and quality of products.

Steel maker Kobe Steel has apologised after finding problems dating back to 2011 including faked inspections data for metals used in many products, including cars, bullet trains, aircraft and appliances.

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. Toyota said it uses materials from Kobe in bonnets, rear doors and other auto parts.

Toshiba is still working to recover from an accounting scandal that began in 2015.

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Toyota also confirmed that the material has been used in hoods and rear doors of some of its vehicles.

Kobe Steel faces potential costs from any product recalls, replacements and possible litigation, including class-action suits in the United States, Yuji Matsumoto, an analyst at Nomura Securities, said in a report.

"Aluminum is one of Kobe Steel's key focus areas in the medium term as part of its strategy to help lighten vehicles, (and) this will certainly have a negative impact on the expansion", Matsumoto noted.

The Japanese government has asked the company to provide more information about the products supplied to more than 200 customers, reportedly including some of the country's biggest manufacturers, including defence contractor Mitsubishi Heavy Industries and a number of automakers.

"We want Kobe Steel to make the utmost effort to restore trust from society", he said.

Sales at Kobe Steel's aluminum and copper division fell 6.4 percent to 323.3 billion yen ($2.9 billion) in the year to March, and recurring profit dropped by more than a fifth to 12 billion yen.