Kobe Steel admitted earlier this month that it had falsified data about the strength and durability of its copper, steel and aluminum products.
Four Japanese car companies have determined that aluminum products they purchased from Kobe Steel (TSE:5406) are safe.
Kobe Steel admitted earlier this month that it had falsified data about the strength and durability of its copper, steel and aluminum products, and said that about 500 of its customers had been impacted worldwide.
The company’s share price rebounded Thursday after Toyota (TSE:7203), Honda (TSE:7267) Nissan (TSE:7201) and Mazda (TSE:7261) vouched for the safety of aluminum products they have received from the company. Kobe Steel also sells to plane and bullet train manufacturers.
Other carmakers have also come forward. Last week, Ford (NYSE:F) said Kobe Steel aluminum was used in hoods for its Ford Mondeo sedans; however, it does not consider safety to be a problem because the aluminum was not used structurally. Mitsubishi (NYSE:MTU) has vouched for the safety of its Kobe Steel-sourced aluminum as well.
Aside from the carmakers mentioned above, Kobe Steel customers such as West Japan Railway (TSE:9021), Central Japan Railway (TSE:9022) and Boeing (NYSE:BA) have raised concerns about quality. Both railway companies have determined that the components from Kobe Steel that were used in their bullet trains did not meet their design standards, but did meet safety specifications.
Kobe Steel is also facing a probe from the US Department of Justice.
The company said last week that it would complete its own investigation in two weeks. It acknowledged on October 8 that workers at factories in Japan had altered inspection certificates on select aluminum and copper products from September 2016 to August 2017, and said it would be looking into other potential instances of data falsification going back 10 years.
Company CEO Hiroya Kawasaki said Thursday that his company’s credibility is at “zero,” but no recalls of cars or airplanes are expected for now. Kobe Steel’s share price closed Thursday up 6.65 percent, but is down 21.04 percent year-to-date.
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Securities Disclosure: I, Melissa Shaw, hold no direct investment interest in any company mentioned in this article.