Japanese gov't steps up measures to tackle Kobe Steel's quality control scandal

The Japanese government has tasked industrial standards-approved bodies to carry out inspections at Kobe Steel Ltd.'s plants in an effort to deal with the company's data scandal.

The Japanese government has tasked industrial standards-approved bodies to carry out inspections at Kobe Steel Ltd.'s plants in an effort to deal with the company's wide-reaching falsified inspection data scandal, Economy, Trade and Industry Minister Hiroshige Seko said Tuesday.

"We will keep an eye on the result of the review," Seko told a news conference.

He added that Kobe Steel should set up its own objective measures to ensure industry standards are kept, warning that if standards are not maintained then a certification organization will have the authority to withdraw its certificate and halt shipments of Kobe Steel products.

Keiichi Ishii, minister of land, infrastructure, transport and tourism, told a separate news briefing that inspections had begun at plants in Japan.

"Japan is primarily responsible for the safety of domestically produced aircraft," Ishii said, with reference to a plant in Mie Prefecture that produces aluminum used in the Mitsubishi Regional Jet passenger jet.

"We will take all possible measures to assure product quality in mass production," Ishii said, adding that data obtained from Kobe Steel will be verified by the government.

Kobe Steel Ltd. had initially admitted to falsifying inspection data on a number of its products, including aluminum, copper, steel powder and special steel products.

It also came to light late last week that the embattled steel maker's own investigations revealed cover-ups and more incidents of data falsification.

Companies ranging from automakers and airplane manufacturers, to defense equipment and Shinkansen bullet train makers, have been affected by the scandal.

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

Initial investigations revealed that Kobe Steel knowingly shipped at least 20,000 tons of aluminum and copper products with fabricated inspection data.

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

It also said that 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, industry experts said.

A recent scandal about unauthorized inspections carried out by Nissan Motor Co, Ltd. and rigged fuel economy tests at Suzuki Motor Corp. last year and an almost identical scandal at Mitsubishi Motors Corp. have further revealed an inherent culture of lax and neglectful procedures at Japan's once-revered blue chip firms, industry authorities also said.

On the back of Takata Corporation's fatal airbag inflator scandal, Japan's reputation as a global leader in the manufacturing industry may now be a thing of the past, experts on the matter also attested.

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