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[depth] The Made In Japan Sign Is A Hundred Years Old. Why Is The Steel Forging?Global Impact
Nov 06, 2017

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  In just one week, Kobe Steel Ltd.Hereinafter referred to as god steel) fraud events affected the list of companies from the original 200 to 500, involving industry across the car, public transportation, aerospace, defense, electronic IT, energy and other fields.

    Events at the start of the Japan's third largest steel company admitted that tamper with the strength of aluminum and copper products, dimension data, counterfeit products into the about more than 200 enterprises, some irregularities can be traced back to ten years ago.Three days later, the iron powder products were also confirmed, and the data on target materials for DVD and LCD screens were tampered with.As of this, the impact of the fakery is still limited to Japan.

   The negative impact of the incident quickly broke through Japan's borders and exposed radiation to many countries abroad.God, chairman and President of kawasaki steel, publicly apologize to the public for the first time in October 12, warned that "at home and abroad have screening out suspicious cases", but "iron and steel products is not one of them," tampering with data is mainly limited to aluminum and copper.

After the incident, shenzhan steel was listed as "made in Japan" with Japanese companies, including takata, Toshiba, nissan and mitsubishi.

   However, kawasaki retracted the statement overnight.The company acknowledges that its core steel business is also involved in counterfeiting.At that time the company also revealed nine cases, including four involves the steel products, determining the god of Thailand, Malaysia and China steel production of copper, aluminum alloy wire, steel wire, steel and other products.

   In the nine cases of its latest disclosure, Chinese companies are involved in three cases, the interface news reporter found on the company's website.Suzhou god steel electronic material co., LTD. (hereinafter referred to as suzhou steel) god, jiangyin FaErSheng (7.590, 0.02, 0.26%) sugita spring system line co., LTD. (hereinafter referred to as the jiangyin steel) god and god steel new spring steel wire for sure (foshan) co., LTD. (hereinafter referred to as foshan god steel) violations in the copper bar, steel wire products, a total of four to customer delivery of 3862 tons.The irregularities mainly change the inspection data in the specifications (dimensions) agreed with the customer, as well as the partial inspection that is not implemented with the client's agreement.

   "The impact on this [Chinese company] is not very big, and all the responses are in Japan."Suzhou god steel general affairs department of the relevant person in charge of a not to be named on the phone told reporters interface, there are currently no received any reply from the Japan head office about this, "we don't have a problem."The person in charge said that the Chinese companies are operating normally, production and delivery are ongoing, and the quality of products can be guaranteed.The company said it would expand in the near future, but declined to say how much time and scale it would expand. "if you are interested, you can come and see it yourself," he said.

Founded in May 2005, suzhou shen gang is a wholly-owned subsidiary of god steel aluminum copper division, which specializes in cutting and processing copper and copper alloy materials.

   "Everything is based on the information of the official steel website."The director of the general affairs department of jiangyin god steel said that there was no more information about the fraud.When asked about the corresponding department at present, the company is in the execution and the product inspection, as well as the customer pays a return visit, the relevant internal verification, said an official with the customer pays a return visit will be scheduled, according to the predetermined manner, related progress will be disclosed in the corporation's official website.

   Foshan god steel general affairs personnel wang also said it is the event information is disclosed, god steel website has revealed that no longer for other individual interpretation, "can only say that our products are no problem right now".

   Jiangyin shen gang was founded in August 2005 in China. It is a sino-japan joint venture that specializes in spring steel wire for automobile industry.Founded in January 2012, foshan shenshan iron & steel co., LTD. Is a japanese-owned enterprise engaged in the business of high quality spring steel wire.

AZ Zhang Meng - China aluminum industry analyst said in an interview with reporters to interface, god steel invested in some factories in China, the incident could be little demand for China's aluminium bearish.On the other hand, exports to China's aluminum products are positive.Because "China is doing a good job in the automotive aluminium industry, and it is perfectly possible that the Japanese auto industry needs to be able to seize the Japanese market".

  Japan's local industries and companies have borne the brunt of the steel incident.Nissan, subaru, Mazda and other Japanese car companies first said he used the relevant products, then the mitsubishi heavy industries, kawasaki heavy industries, such as IHI heavy industry enterprises are also involved, and even the Japanese Shinkansen pride of (also known as the bullet train, one of the world's most advanced high-speed rail system) were also exposed the problem products, and do not conform to the Japanese industrial standard (JIS), even from jp recently tanegashima island H2A rocket launch has also been the centre of the universe.In addition, Japan's ministry of defence has said the issue is being used or used to make aircraft and guided weapons for the self-defense forces.The fukushima no. 2 nuclear plant has also purchased parts of a nuclear reactor built by shenanshan steel, but has not yet been used.

Outside Japan, in addition to previously disclosed general motors (GM), Ford (Ford) and Boeing Co., the world's largest maker of passenger aircraft,More than 30 foreign companies have now used the products made by the company, including U.S. automaker Tesla Inc. (tsla).Germany's Daimler AG, France's PSA, Britain's Rolls-Royce and Europe's Airbus SE.Previously, Hitachi said that the steel products had been used to build some of the railway cars in the UK.

   South Korea's hyundai kia motors and Korean air are the latest victims of the shenano-steel scandal.On October 14, south east Asia daily reported that modern kia of two electric vehicles using the god steel aluminum parts and steel, Korean air is by using the offer of the Boeing aircraft parts and by implication, the type and size of product at present, the company is investigating.

  Bloomberg reported that on October 12, citing experts views, although there is no customer god steel related products pose a safety hazard, but the company is likely to be by countries such as Japan, the United States investors, customers, consumers and regulators of litigation.

  As the steel has been exposed to more and more new problems, the scandal surrounding its core data fabrication has intensified.The company, at the request of Japan's ministry of economy, trade and industry, plans to consolidate the safety verification results within two weeks and publicize the cause and response measures within a month.

   Founded in September 1905, shen steel has a history of more than 112 years and its influence is spread throughout Japan.

  Shinzo Abe, Japan's prime minister, also worked for shenzhan steel.Last year on March 30, one of Mr Abe in the liberal Democratic Party (LDP) network shows mentioned in an experience I had when I first got into god steel, had he mistyped the steel pipe size, has created a large number of short spend long steel pipe, "thought would be fired, but it's not a big deal".After three years of working in kobe steel, Mr Abe entered politics.According to xinhuanet.com (33.140, -2.58, -7.22%), the scandal has revealed that Mr. Abe, who is seeking to stay in power, has made no comment since the scandal broke.

   Hanshin earthquake in 1995, kobe, Japan as well as the adjacent port cities have been hit, god steel jedi rebirth as the symbol of the Renaissance in the region, the company has become the leading (the end of the 19th century -) in the early 20th century Japan fashion one of the important role of the industrial revolution, the scandal is steel mexicana with god.

   In 1999, the steel was disclosed to the blackmailer for funds;An internal investigation in 2006 found that two of its iron smelting plants had tampered with smog data for more than 30 years.In 2008, its Japanese company, gao zhou bosteel co., ltd. was exposed to falsification of steel products inspection data;In 2009, the chairman of the chairman of the steel company resigned after being involved in illegal donations related to local parliamentary elections.In 2016, the quality control problem of the stainless steel co., LTD.

   For a long time, god steel with its to develop special alloy materials according to the requirement, then processed into high precision technology of complex shape in different parts of the world by cars, airplanes, weapons, and other manufacturers welcome.Because of the high cost of steel and raw materials in recent years, the company's sales in 2014 and 2016 have been decreasing year by year, and the company has realized two consecutive financial year losses.

  So kawasaki, the chairman, has bet on aluminum to find new sources of profit in the car industry, which is demanding a lighter, more fuel-efficient car.He has ordered a big increase in production, but has invested little in new production systems that reduce the workload.In late September this year, kawasaki, don't feel the coming crisis, still shows the media he the outline of the picture, about the future of the aluminum business for automotive use of aluminum, confidence will rise.

  The company had forecast a net profit of 35 billion yen for the fiscal year ending in March and is expected to recover quickly from last year's huge losses.But the potential replacement, recall, claims and other related costs will undoubtedly add to the financial burden on the company.

   The scandal will also affect the profitability and financing of the company."The scope of the cost of dealing with the scandal is not known," said Kazuhisa Mori of jpmorgan securities.The same is true of the steel capital, which is expected to be negative for the third year in a row because of growth investment.On the one hand, the company spends about 70 billion yen to upgrade its Asia (aluminum for light vehicles) facilities.

  Mori said that if the company needed funds to "pay for the scandal", there would be no room for financing, so the company might need to recoup its growth investment.

   The shenando scandal involved dozens of employees, including the management of kobe steel.Is said that the steel vice President may god that comes from factory "pressure" have to complete the shipment target, tamper with the data is not individual behavior, but management acquiescence, is the company's integrity problem.

  Due to the hard demand for the delivery date, the workload and pressure of front-line workers increased, and gradually lost contact with the management who issued orders in the distance.It was in this dysfunctional setting that the workers began to falsify data and fall into the habit of cheating to get their way.The nikkei Asian review reported on October 15 that the case of shensteel illustrates a structural problem: the more mature the market, the more companies want to cut costs.

  The company has a wide range of business and highly independent business.The mechanical and electric utilities such as steel, aluminum, copper and welding are the three main pillars of the mechanical and electric utilities such as industrial machinery, engineering machinery and engineering technology.

  This independent business sector system provides a "greenhouse" for counterfeiting.On October 14, the nikkei Asian review comments, said steel that god in the name of "specialization", causes each business department personnel and the data are independent of each other, very few overlapping with other departments, to god in the steel produced "silo effect" the entire organization.The "silos effect" refers to the lack of communication between the departments within the enterprise, and only the vertical command system with no horizontal coordination mechanism.

  The BBC quoted experts view reports on October 13th, since the 90 s, Japan's economic growth slowdown is a major factor for a long time, this forced a change in the enterprise business model, and pay a big price.Japan's Macro consultancy (Japan Macro Advisors) managing director and chief economist Okubo (for Okubo) said: "big companies used to live in a stable, predictable and in the growing market, but the environment changed, some companies may resort to shortcut."

  To "adapt to the new rules", Japanese companies began to focus on restructuring, doing everything they could to reduce costs and make painful adjustments such as high efficiency.Martin Schulz, a senior fellow at the Fujitsu institute in Tokyo, said Japanese executives were anxious to get the desired results, "sometimes even to test the bottom line of quality management standards".

  He added that the workload of core staff and managers had reached their limits, leading to overwork and inappropriate behaviour in some cases.In addition, the need to open new markets abroad to boost profits has created other problems for Japanese companies' overseas subsidiaries.

Japanese car team?Japan's third largest steel plant has admitted to counterfeiting, and Japanese companies' credibility myth has been hit hard by the fact that the impact has been felt worldwide

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The kobe steel scandal

   8, Japan's third largest kobe steel in incorporated business enterprise of iron and steel admits the forgery of about 20000 tons of used in aircraft and automobile manufacture metal inspection data, Toyota is used in the United States, such as Boeing aircraft aluminum products.

According to Japan's third largest steelmaker kobe steel (KOBELCO) released by the news that the company has organized to tamper with the part of the strength of the aluminum performance data, and supply some irregularities since 10 years ago, involved about 200 customers, most of car users, including Toyota, nissan, Mazda, subaru, mitsubishi and other car companies are in the "gun".

   At the end of August this year the company's internal investigation found that in 栃 wood, triple, pass three county, three aluminum factories and subsidiaries located in kanagawa prefecture of copper products tamper with the part of the aluminum and copper products the factory data for a long time, pretending to be standard products for sale.The above mentioned products have found that some aspects are not up to standard before the product is out of the factory, but the data such as strength and size are modified in the product inspection certificate to make the inspection certificate conform to the customer specifications.

   The current investigation found that about 2.15 million tons of aluminum and copper products were poured into the company between September  2016 and August 2017.Among them, the total shipment of the aluminum products involving tampering data is 19,300 tons, 2,200 tons of copper products, and 19400 aluminum cast forging pieces.These represent about 4 per cent of the market's annual sales.

  It is worth mentioning that strength is the basic condition that the parts should be satisfied first, which is the ability to resist deformation, fracture and other destructive forces under the action of external forces.Now, most of these substandard metals have become important structural components of cars.

   Dozens of employees, including senior executives, were said to have been involved in wrongdoing.In addition, the review over the past decade has revealed other forged documents to simulate data to meet customer requirements...In other words, ten years ago, kobe steel was starting to fake it.

   For the incident, Mr. Neto, the executive vice President of kobe steel, apologized at a news conference on Aug. 8.Currently, unqualified products have not caused any safety concerns, and the company will continue to cooperate with customers to identify the impact.

The industry affects the world

  Kobe steel is one of Japan's leading steelmakers, and the country's leading supplier of aluminum and copper products, and Japan's third-largest steelmaker.Founded in 1905, the company's steel output in 2007 was 807,000 tons, one of the world's top 500, ranking 39th.Its business covers steel, machinery, engineering, real estate and other fields. It has high-tech business in electronic and information system, and is a comprehensive multinational company with the core of steel industry.As early as 7 years, kobe steel production out of the world's most hard aluminum alloy, the aluminum alloy length of korah lockheed Martin lithium aluminum - alloy than the United States over 10% longer, is currently the world's most hard aluminum alloy, application is very wide, can be used in cars and shuttle.

   In the first quarter of 2017, net sales of kobe steel, which did not falsify data scandals, rose 7.6 per cent year-on-year to 435 billion yen.Operating profit jumped 118.0% and 138.6% to y303 billion, respectively.Net profit rose to y25bn from a loss of y2bn in the first quarter of fiscal 2016, up 86.6 per cent from the previous quarter.

  As a famous domestic aluminum, copper products "one hundred - year - old", kobe steel is quite a long time car brand in the material supplier, it is understood that kobe steel spring supply half the world's cars, and also a huge aircraft carrier sales scale level Japanese carmakers planning a joint venture in the United States, in order to meet the demand for car aluminum proliferated.

Some of the violations even started a decade ago, as news of the use of performance-data such as the strength of some of the aluminium products, and the availability of supplies, was exposed.Make kobe steel overnight.Despite the apology, the vice President of kobe steel, mei yuanshang, said: "deep remorse and regret."But for a while, doubts and anger continued to pour into the company, once a symbol of the world's top five.

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Several major companies have been affected

  After the news came to light, many enterprises that cooperated with kobe steel were affected, and the impact of data fraud on the automobile industry became the focus of public attention.

  As the material of Japan and even the world's top suppliers, kobe steel can be said to be the most Japanese car brand in the material suppliers, and even a lot of beauty, the material of ashkenazi and Chinese car brands suppliers, its products in the auto parts are many, such as used to prop up inside the engine cylinder reciprocating motion of auto valve spring steel wires, kobe steel occupies 50% market share in the world.And high strength steel plate, automotive aluminum plank occupied high market share (including car aluminum plate with up to 50% of the Japanese market share), thus its products if quality problems, then affected the cars will be countless.

   In Japan, Toyota, nissan motor, subaru, Mazda and other companies have revealed that they use kobe steel in their respective vehicles.In addition, other manufacturers, such as Honda and mitsubishi motors, are stepping up their verification efforts.Japan's transport ministry asked Japanese car manufacturers to confirm whether they had used the faulty material as soon as possible.

  Subaru sold about 160,000 units in Japan in 2016.The model is "LEVORG", sport utility vehicle (SUV) "forest man".

   Mazda has sold about 200,000 cars in Japan in 2016, including products such as the "unkcera" and the SUV "cx-5".

  Toyota also revealed on Monday that some of the car's hood and back-up boxes used aluminum products with problems.Toyota said it was confirming the vehicles and the possible impact of the use of the products and decided on the future.

  Companies have said they have yet to identify safety and durability issues, but are grasping for confirmation, and the impact of the kobe steel product data fraud is also growing.

  Japan's "daily news" said that kobe steel will continue to investigate the product safety, once confirmed that involve the most important parts of safety problems such as insufficient intensity, is likely to be upgraded to a massive recall.

The impact extends to aviation defense

   Over Japanese large iron and steel manufacturers, "kobe steel" tampering part of problem such as aluminum and copper products intensity data, in addition to the automotive industry which is closely linked, the problem also affected the scope of escalating after exposure.

   Data tampering has been extended from carmakers to Shinkansen, aerospace and defence, the report said on Tuesday.

  JR central company found that the product is used in the Shinkansen car spare parts, etc., and has been recognized by the relevant data, the strength of the product not to run safety hazards, will in future to check your car regularly and timely replacement of qualified products.

  Japan also revealed several mainstream media, according to the current master of the data found that these data, a subsidiary of fake products had been used in mitsubishi heavy industry is developing part of the Japanese domestic small jet "MRJ," in addition, mitsubishi heavy industries, according to its for the Japan aerospace exploration agency (JAXA) development H2A rocket also USES the related products.

  Not only that, the report said that the H2A rocket, which was launched from the cosmos center in kagoshima prefecture on October 10, also used kobe steel.Mitsubishi heavy industries, a maker of rockets, revealed that part of the rocket used aluminum, but confirmed that there were no technical problems.The company did not give details, saying it would still investigate whether it was used in other rockets.

   Another Japanese company, subaru, also used the related aluminum products.Subaru's planes include the self-defense force trainer and the 787, the central wing of the Boeing midrange Boeing.

  The latest confirmation is that the products have even gone to Japan's defence sector.On October 10, local time, the Japanese government for economic, trade and industry (meti), Japan's third largest steelmaker by kobe steel tamper with the part product technical data of the press conference, said kobe steel forging strength products can be applied to the equipment.Mitsubishi heavy industries, kawasaki, IHI corporation, SUBARU (SUBARU) four companies confirmed, the production of defense supplies used by kobe steel aluminum, but is there a safety issue is still in the confirmation.Given the safety of the security, the province did not disclose which defense equipment was used.But the defense ministry acknowledged that problematic products have been used in defense equipment such as aircraft and missiles.

   The scandal is expected to have a significant negative impact on kobe steel's performance, with the Tokyo stock market on Monday having seen a massive sell-off of its shares in kobe steel.As of 10 a.m., the market had sold 27 million units of the stock, far exceeding the purchase order of 1.7 million shares, or 21.3 percent.

The reason for the fraud - delivery on time is not an excuse

   For fraud, kobe steel vice President (deputy general manager) may the original is 8, frankly, at the press conference of frauds are organized to participate in, including kobe steel management, there are dozens of people involved in the tampered with.In a press conference, Mrs May said, "I'm sorry to have worried you."Mr May also said the plant was "under pressure to complete the shipment target", but he denied there had been any irregularities from the top of the headquarters.

   In the overnight, kobe steel, a Japanese century-old steel company, was swept to the floor.The unexpected is that Japan's manufacturing industry is taking the "altar" as a collective example.So far, it is safe to say that the counterfeiting of kobe steel is no accident.Kobe steel institute vice President mei original is person mentioned on October 8th, the partial products has been used since 10 years ago after tampering with data, manipulate data and not to individuals, but a management acquiescence, is the company's integrity problem.

  Was the product of the last ten years of aluminum and copper fabrication based on cost pressures or corporate disregard for the rules?I don't know.Mrs May has attributed it to the pressure of delivery on time and denied that the operating floor had been pressured by the financial deficit to produce the first line of production.But in the face of long-term fraud, the term "delivery pressure" is clearly untenable.

   Industry insiders say that, for whatever reason, the process management of the whole production must have been a problem.

   It is worth noting that the fact that kobe steel has tampered with factory performance data to qualify for the product is not the first time it has been exposed.Not only did tampering with data in aluminum and copper products, but other products have similar behavior.

  On June 9, 2016, kobe steel has announced that the group, the god of stainless steel wire company to reduce the number of defective products, in the past more than 9 years, tamper with the stainless steel wire tensile strength test data, the unqualified products as qualified product delivery, affect the downstream products of water heater and other home appliances and cars and so on.

  Stainless steel wire of the survey period for defective items in April 2007 to May 2016, the company has shipped with in line with the Japanese industrial specifications (JIS) identification of stainless steel 7400 tons, which is not qualified steel wire for a total of 55.6 tons, accounting for more than 0.75%.

   As early as 2008, another subsidiary of kobe steel was also reported to have been caught in a scandal involving shipments of steel that had not been tested by Japanese industrial specifications.

  The future fate of kobe steel, or even kobe steel, will be overshadowed by the re-exposure of tampering performance data.

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The world's reputation for manufacturing Japan is being tested

   When it comes to Japanese manufacturing, many people think of it as the embodiment of "perfect craftsmanship".In recent years, however, Japanese companies have been accused of "counterfeiting".Japan's kobe steel scandal over tampering data involves a number of Japanese manufacturers, including Toyota, mitsubishi and nissan.From cars to Shinkansen trains, from planes to rockets, these areas of Japan's manufacturing industry have been "Mired" in the scandal.

 The scandal is a blow to Japan's third-largest steelmaker, and highlights broader concerns about inspection and quality control.But the scandal is likely to be hit not only by the kobe steel industry."Made in Japan", known for its high quality, has been hit by a string of fraud scandals in recent years.

   Just last month, Japan's ministry of land and transport found that the final inspection of nissan's car was carried out by a "auxiliary inspector" who had not been identified as a regular inspector by nissan.On September 29th nissan had to announce that it would stop selling about 60,000 new cars in its stores.Up to one million vehicles could be recalled if the offending vehicles were found to have the same violations.

   In June, takata filed for bankruptcy protection.Eight years ago, takata's faulty airbag recalls became the biggest security crisis in the industry's history.Takata acknowledged earlier this year that it had hidden its production of airbags for 15 years and agreed to pay $1 billion to U.S. regulators, consumers and automakers.As of May 2017, 19 carmakers, including Honda, Toyota, nissan, BMW, mercedes-benz, and tesla, recalled as many as 120 million vehicles in the global market.

   Last April's "flash gate" of mitsubishi motors was also a blow to the credibility of Japanese manufacturers.In April 2016, mitsubishi motors of Japan acknowledged that companies overstated fuel efficiency in fuel economy tests and glorified fuel consumption.According to the report, mitsubishi has been modifying the data for 25 years.Mitsubishi was forced to seek funding from nissan, which eventually agreed to buy a third of mitsubishi motors for $2.2 billion.

   Is Japan's kobe steel the explosion, which is with Toshiba its profits, nissan "ineligible to check" mutually gaffes, one after another well-known enterprise scandal is likely to cause the loss of Japanese manufacturing the overall image, also let the "made in Japan" was a world-class reputation suffered a severe test.

   Although the kobe steel has established a commission of inquiry, and entrust a third party to carry out further investigation, said at the same time, the unqualified product yet cause any safety concerns, but it caused a posse and consumers for car quality and safety concerns.In addition, the huge impact of takata airbag on the auto industry has not ended, and will kobe steel become the next "takata"?Will the auto industry face a new round of massive recalls?Is the integrity of Japanese companies still in existence?......These problems, with the kobe steel fraud, will reignite the public's nerves.