Boeing, Airbus Respond to Kobe Steel Scandal, Are Investigating Supply Chain
Liao Shumin
DATE:  Oct 17 2017
/ SOURCE:  Yicai
Boeing, Airbus Respond to Kobe Steel Scandal, Are Investigating Supply Chain Boeing, Airbus Respond to Kobe Steel Scandal, Are Investigating Supply Chain

(Yicai Global) Oct. 17 -- Two of the world's biggest plane makers, The Boeing Co. [NYSE:BA] and Airbus SE [EPA:AIR;BME:AIR;BMV:AIR], have spoken out on the latest progress in the investigation into the scandal surrounding Japan's Kobe Steel Ltd. [TYO:5406].

Scandal surrounding the Japanese steelmaker came to light in Oct. 8, suggesting the company had sold aluminum and copper products that had failed quality control and falsified performance data. The issue arises just a year after the firm was busted for falsifying stainless steel test data last year, Japan's Kyodo News reported.

"Boeing has been made aware of quality report from several suppliers," an executive at the firm said. "Boeing has been working closely with our suppliers to ensure timely and appropriate action, including comprehensive inspections and analysis throughout our supply chain. Nothing in our review to date leads us to conclude that this issue presents a safety concern. We will continue to work with our suppliers to complete the investigation. Product quality and safety is our top priority."

"We do not buy products directly from Kobe Steel, but are investigating whether any suppliers have been affected," an Airbus executive said.

Kobe Steel said in June last year that it had tampered with data on the strength of stainless steel products for more than nine years in order to meet Japanese Industrial Standards. The company conducted investigations to prevent such problems from happening again, but found no evidence of violations relating to aluminum products.

The firm believes that problem products would affect Toyota Motor Corp. [TYO:7203;LSE:TYT;NYSE:TM], Mitsubishi Heavy Industries Ltd. [TYO:7011] and 200 other Japanese firms. Some of the trains on the Shinkansen, Japan's bullet train network, could also be affected.

The Ministry of Economy, Trade and Industry of Japan confirmed that Kobe Steel products are used in military products made by Mitsubishi, Kawasaki Heavy Industries Ltd. [TYO:7012] and Subaru Corp. [TYO:7270], and have been used in aircrafts, missiles and armored vehicles. The Japanese Defense Ministry is concerned that the weak products may lead to shortened usage.


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Keywords:   Boeing,Airbus,Kobe Steel