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Kobe Steel shares set to plunge after data falsification

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Reuters TOKYO
Last Updated : Oct 10 2017 | 9:48 AM IST

TOKYO (Reuters) - Shares of Kobe Steel Ltd were untraded on Tuesday morning as sell orders dwarfed buy orders after Japan's third-biggest steelmaker revealed it had fabricated data to falsely show that its products met customer specifications.

Kobe Steel said on Sunday that about 4 percent of the aluminium and copper products that it shipped from September 2016 to August 2017 were falsely labelled as meeting the specifications requested by customers.

The admission from the steel and aluminium maker follows similar scandals at Japanese companies including Nissan Motor, Mitsubishi Motors and Takata Corp. Toshiba Corp is still battling the fallout of a scandal involving reporting inflated profits.

Products with falsified data were shipped to about 200 companies, a Kobe Steel spokesman said. Aluminum castings, forgings and flat-rolled items, along with copper strips and

tubes were among the products affected, a statement said.

Companies including Toyota Motor Corp, Central Japan Railway, Mitsubishi Heavy Industries, Mazda Motor Corp and Subaru Corp were among those using products covered by the admission from Kobe Steel, according to media reports and statements.

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Sell orders outpaced bids by a factor of roughly 60 to one in early trade. The Tokyo bourse was closed for a national holiday on Monday. On Friday the shares rose 2 percent to 1,368 yen.

Kobe Steel has said the impact of the data falsification on its earnings is still unknown.

(Reporting by Chang-Ran Kim and Aaron Sheldrick; Editing by Stephen Coates)

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First Published: Oct 10 2017 | 9:31 AM IST

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