Tokyo, Oct 13 (AFP) Japan's Kobe Steel admitted todaythat a snowballing falsified data scandal had affected around500 customers, more than twice as many as initially thought.
The new estimate comes as Kobe Steel's battered stockfell almost nine per cent to finish at 805 yen ($7.20), downmore than 40 per cent since the start of the week after itadmitted falsifying strength and quality data for a string ofproducts -- a practice it said may have started a decade ago.
The embarrassing scandal for a venerable firm that onceemployed Prime Minister Shinzo Abe has already hit widesections of Japanese industry, including automakers Toyota,Nissan and Honda which used the materials in their vehicles.
The company had previously admitted to falsifying qualitydata for products sold to some 200 clients.
"Combined with previously announced clients, it willtotal about 500 firms," Yoshihiko Katsukawa, a senior KobeSteel executive, told a press conference.
"Please let us refrain from naming specific clients thathave been affected. We have communicated with our customersand have discussed ways to confirm the safety" of ourproducts, he added.
The CEO of Japan's number-three steelmaker insistedFriday that the affected products did not appear to pose asafety risk.
The company and its clients agreed on certain qualityspecifications, which it did not meet in many cases.
"So far, our review and investigation has shown there hasnot been any problem that raises concrete doubts about thesafety of our products that did not meet specifications,"Hiroya Kawasaki told a press briefing.
"We are resolved to take swift and appropriate actionswhen and if we see cases that raise safety doubts in ourproducts."On Thursday, Kawasaki acknowledged that trust in his firmhas "fallen to zero".
"The crisis is ongoing so it's tough to know at thispoint how big the impact on the company will be and whichindustries it will affect," Hideyuki Suzuki, head of theinvestment information section at SBI Securities, told AFP.
"Kobe Steel's share price will hit bottom once thefinancial impact on the company becomes clear," he added.
About 66 per cent of the company's sales are in Japanwith the rest to China and other overseas markets.
The crisis marks the latest in a string of qualitycontrol and governance scandals to hit major Japanesebusinesses in recent years, undermining the country'sreputation for quality.
The affected products include steel wires used in carengines and tyres -- a key company product -- as well asaluminium found in Japan's bullet trains and materials inhigh-speed trains in Britain.
"If it was found that there are safety problems (withsteel wires) it could shake the foundation of Kobe Steel,"Takayuki Atake, manager of credit research at SMBC NikkoSecurities, said in a report.(AFP)AMS.
This is unedited, unformatted feed from the Press Trust of India wire.