A big car company like G.M. buys millions of tons of steel a year from a dozen or two dozen producers, in a variety of grades and forms. Steel can be sourced from different mills and shipped to any number of plants worldwide. G.M., for example, has 12 vehicle assembly plants and six stamping plants in the United States alone, all of which take deliveries of steel from many different producers.
All of Japan’s major carmakers — Honda, Mazda, Mitsubishi, Nissan, Subaru, Suzuki and Toyota — are looking into their use of Kobe Steel materials. Toyota called the data falsification a “grave issue” and said it was looking into the problem and considering how best to respond, a statement echoed by other carmakers. Ford and General Motors are trying to determine whether they have used the company’s products.
Kawasaki Heavy Industries, which makes equipment for Shinkansen high-speed trains in Japan, said it was investigating. JR Tokai, a railway company that operates the busiest Shinkansen route in Japan, between Tokyo and Osaka, said that the data discrepancies “do not present a problem in terms of design standards,” but that it was nonetheless considering whether to replace certain train components.
Mitsubishi Heavy Industries uses aluminum from Kobe Steel in a midsize aircraft it is developing, the Mitsubishi Regional Jet, as well as aircraft components it supplies to Boeing. Mitsubishi Heavy said it was investigating. Boeing said in a statement, “Nothing in our review to date leads us to conclude that this issue presents a safety concern, and we will continue to work diligently with our suppliers to complete our investigation.”
Kobe Steel’s problem points to “a common organization issue,” said Shin Ushijima, a lawyer who serves as president of the Japan Corporate Governance Network. He drew parallels between Kobe Steel and Takata and Mitsubishi, as well as with financial-reporting improprieties at Toshiba, which admitted to overstating profit in 2015.
“Boards aren’t doing their jobs,” he said. “This isn’t an issue that can be solved by the president resigning. There needs to be wholesale change.”
He added, “The Kobe Steel case is a test of whether we’ve learned anything from Toshiba and these other issues.”
Kobe Steel said it had confirmed data falsification affecting roughly 19,300 tons of flat-rolled and extruded aluminum products, 19,400 units of aluminum casting and forgings, and 2,200 tons of copper products. The amount was about 4 percent of the company’s output of those products from September 2016 to August.
The company said that it had received no reports from customers of problems with the affected products, and that the falsification had been discovered during an internal review. The improperly certified metals had been shipped to about 200 companies, but Kobe Steel declined to reveal their names.
It said “tens” of employees and managers had been directly involved in the falsification, although no penalties against the employees were immediately announced. The company is still investigating.