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Kobe steel crisis: What next for automakers?

2017-10-17 13:56

UNDER PRESSURE: The Japanese government is urging steelmaker Kobe Steel to clarify the extent of manipulation of data on steel, aluminum and other metals used in a wide range of products, reportedly including rockets, aircraft and cars. Image: Kyodo News via AP

Lance Branquihno

Tokyo, Japan - Since 1905 Kobe has been a byword for quality steel and metal products. Japan’s third largest steel and metals producer is a crucial source in the automotive supply chain and the crisis which is currently enveloping this company has triggered panic. 

Kobe’s recent admission that employees falsified the strength and durability data of certain aluminium and copper products has collapsed its share price and tarnished the once inarguable global image of Japanese manufacturing quality. 

Aluminium and copper batching under suspicion

Most worryingly, Kobe supplies a significant number of larger automotive brands: Toyota, Honda, Nissan, Mazda, Mitsubishi, Subaru, Ford and GM. Designers and engineers take as gospel the strength and durability data of materials they specify from suppliers, to ensure the integrity and safety of those cars which eventually evolve from prototypes to production. Even the slightest deviation in material strength can have unpredictable, unintended and potentially catastrophic consequences. 

Although Kobe is historically known for its steel products, only the aluminium and copper batching is under suspicion. Steel is the crucial safety martial in contemporary automotive design: heavier than aluminium but stronger, with greater elastic deformation properties, it’s the safety cell that surrounds the cabin in most car design. Aluminium is usually used for suspension components, engines and surfacing – where weight can be saved, without compromising driver or passenger safety.

CRISIS MODE: Kobe Steel President and CEO Hiroya Kawasaki speaks during a press conference in Tokyo, Friday, October 13 2017. Image: AP / Koji Sasahara

The falsifying of aluminium product standards should not have a direct consequence for car occupant safety, but it greatly increases the risk for pedestrians. With doors and bonnets made from aluminium which cannot be predicted to react as intended to impact, pedestrian crash safety – which has improved greatly in the last decade due to targeted legislation – could be compromised. 

How? An aluminium bonnet or door which deforms incorrectly could entirely invalidate the pedestrian crash rating of a car, by shaping into a sharp edge under load. Toyota and Honda have both identified that falsified grade aluminium from Kobe has been used in bonnets and doors, with GM still investigating. Mazda and Mitsubishi are studying their supply chain and production inventory to trace whether they have a Kobe problem too. 

Beyond the aluminium falsifying Kobe’s confirmed there could be issues with the specification of iron powder products too, primarily used in the manufacture of gears. Few metal components are subject to the fiction generated temperature torture and torque loading quite like gearbox internals. Any strength issues here could dramatically shorten transmission lifecycles and become the origin of complicated warrantee issues. 

The Kobe metal falsification crisis is at risk of becoming a second Takata airbag scandal, ruining the once vaunted reputation of Japanese quality and corporate transparency. A global car recall and resupply initiative to replace sub-standard aluminium door panels and bonnets, not to mention gear innards, would have tremendous consequences for Kobe and be terribly inconvenient for car owners. We’ll keep you updated as the crisis develops. 

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