Kobe Steel plunged deeper into crisis on Wednesday as fresh revelations showed data fabrication at the steel maker was more widespread than initially thought, heightening a safety scare along the global supply chain.
Investors, worried about the financial impact and potential legal fallout, again dumped Kobe Steel stock, wiping about $1.6 billion off its market value in two days, Reuters reported.
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Kobe Steel said late on Wednesday it found 70 cases of tampered data on materials used in optical disks and liquid crystal displays at its Kobelco Research Institute which makes and tests products for the company. It also found one case of falsified data on iron powder products shipped to a customer.
An internal probe carried out since it found issues in its aluminium and copper business has not found other cases of data tampering, Yoshihiko Katsukawa, a managing executive officer at Kobe Steel, told a news conference.
According to Reuters, he said the company – which has said it was examining possible data falsifications going back 10 years – has begun an external investigation of all its units, including those overseas.
"We can't rule out the possibility that the external investigation will find other cases,"Katsukawa said, adding no customers had raised any safety issues or stopped buying its products.
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By GlobalDataKobe Steel president Hiroya Kawasaki will meet a senior official at the industry ministry on Thursday, the ministry said in a statement cited by the news agency.
The new revelations come after Kobe Steel admitted at the weekend it had falsified data about the quality of aluminium and copper products used in cars and other products such as aircraft, space rockets and defence equipment – a fresh blow to Japanese manufacturers' reputation for quality production.
There have been previous cases in Japan involving falsified data, including at Nissan Motor, Mitsubishi Motors and Takata, which filed for bankruptcy this year over faulty airbags that were blamed for 17 deaths and scores of injuries.
Kobe Steel faces potential costs from any product recalls, replacements and possible litigation, including class action suits in the United States, Yuji Matsumoto, an analyst at Nomura Securities, said in a report cited by Reuters.
The data tampering at its aluminium unit could also hit plans to expand the business as car makers increasingly turn to the material, which is lighter than steel, to meet tighter environmental rules.
"Aluminium is one of Kobe Steel's key focus areas in the medium term as part of its strategy to help lighten vehicles, (and) this will certainly have a negative impact on the expansion," Matsumoto noted.
Toyota Motor and Ford have said they are investigating the safety of products from Kobe Steel, according to Reuters.
The steel maker reported losses in the last two financial years, but has said it expects to return to profit this year, the report added.
