Kobe Steel

[Guest]

We’ve said it once, we’ve said it 1,000 times: don’t falsify data on your steel inspection certificates.

But Kobe Steel, Japan’s third largest steel producer, apparently didn’t take our advice. It disclosed that employees fabricated data for Kobe’s aluminum and copper products from September 2016 until this summer. In other words, workers claimed metals met strength requirements…when that wasn’t the case.

Kobe Who?

Kobe Steel isn’t you’re average steelmaker. It supplies some of the largest aircraft and auto manufacturers in the world, like Boeing, Mitsubishi, Subaru, and Toyota. And now, about 200 companies are desperately checking their fuselages and chassis to make sure they’re up to snuff (aka doing the work Kobe was supposed to do).

So, if you see that airplane wing start to disintegrate on your approach to JFK, at least you’ll know who to sue for the rough landing. 

And speaking of disintegration, the Steel Mamba lost more than 20% of its market value(now sitting at $3.5 billion) on the news.

And speaking of disintegration (again)…

Japan’s manufacturing reputation is unraveling. Just ask our friends over at Nissan, who recalled 1 million cars last week after reports of unauthorized inspections. Or how about those folks at Takata? They shipped off 70 million defective airbags to 19 different automakers. 

And with Japan’s long-standing street cred for quality manufacturing taking a hit, not much sets it apart from Chinese steel (aside from being more expensive). 

The WSJ of Japan, Nikkei, might’ve said it best: “The falsification problem has become an issue that could destroy international faith in Japanese manufacturing.”

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