The U.S. Government Is Investigating The Growing And Potentially Catastrophic Japan Metals Scandal

Kobe Steel HQ. Photo: Wikimedia Commons
Kobe Steel HQ. Photo: Wikimedia Commons

Kobe Steel, the Japanese steelmaker at the center of an ongoing metals scandal, is facing scrutiny from the U.S. Department of Justice, the company said Tuesday, after admitting last week that it falsely labeled products supplied to over 500 companies across the world.

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Automakers including General Motors, Ford and Toyota are among an expansive list of multinational corporations that have received products from Kobe Steel and are impacted by the scandal. Kobe said last week that staff falsified reports on the strength and durability of products requested by its clients to meet their specifications.

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An internal investigation by the company has found that falsely-labeled products date back more than a decade. No injuries or safety problems have been revealed to date, though Kobe’s investigation is ongoing.

Kobe, Japan’s third-largest steelmaker, said Tuesday that its U.S. subsidiary had been asked by the Justice Department to produce documents related to the “non-conformity” of products sold by the company to U.S. customers. The company pledged to “sincerely cooperate” with the Justice Department’s investigation and said it was unclear how the probe would impact its business.

Since Kobe went public with the issue last week, Japan’s corporate world has been reeling from what is shaping up to be another scandal of monumental proportion. Takata’s fatal airbag debacle is still a fresh wound.

Initially, Kobe said the affected metals included its copper and aluminum business, but that list has now grown to include steel powder and steel wire. Beyond the auto industry, Boeing is said to have received falsely-certified products from Kobe, and Japan’s famous bullet trains are also reportedly impacted.

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The list of affected automakers includes: General Motors, Toyota, Nissan, Honda, and Ford. Daimler and PSA both denied an earlier report from the Nikkei newspaper in Japan that they used Kobe as a supplier.

A spokesperson for the U.S. Justice Department didn’t immediately respond to a request for comment.

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Do you know what’s going on with the Kobe Steel situation? Drop a line at ryan.felton@jalopnik.com or find my contact info for Signal here.

Senior Reporter, Jalopnik/Special Projects Desk

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DISCUSSION

twotoneloser
TwoToneLoser

I don’t understand how this was able to happen. I used to be in fabrication. I would personally do hardness tests on the material. We know that the supplier screws up, or tries to fuck you by passing along out of spec stock as good, and we also know our purchaser screws up, trying to save a buck usually, or buying the wrong stuff altogether. We measured all sorts of factors, and even a two-bit operation like ours had a couple of Rockwell Hardness Testers.

The softer material shapes differently too.

So the steel company may have lied, but the fabricators also lied, and the automakers were lazy if they didn’t do a spot check every couple thousand parts.

As long as this is reported to have been going on, QA wasn’t doing their job, or they looked the other way.