Some Kobe Steel products facing China customs delays - Shinsho president (updated)
31/10/2017 07:44
* Shinsho Corp has experienced delays in customs clearance
* Has not received any order cancellations from customers
* Sees some risk of impact, including losing customers
(Adds background, share price)
By Yuka Obayashi
TOKYO, Oct 31 (Reuters) - Kobe Steel Ltd's 5406.T trading
unit said on Tuesday it has experienced delays getting products
from the embattled Japanese steelmaker through Chinese customs
because of a data fabrication scandal that has rocked global
supply chains.
Shinsho Corp 8075.T , which sold some Kobe Steel products
with tampered specifications, has been hit with delays on some
shipments as Chinese custom officials sought more information,
President Takafumi Morichi told an earnings news conference.
While Morichi said products were cleared after delays, the
move by Chinese customs is another hitch for Kobe Steel as it
tries get to the bottom of widespread data tampering on products
used globally in cars, trains, aircraft and nuclear plants.
The company has not received any cancellations from its
customers, but it sees some risk of an impact on its business,
including having some customers switching suppliers, Morichi
said.
Kobe Steel is the subject of a U.S. Justice Department
inquiry and has lost customers as a result of the scandal. Its
shares have fallen more than 30 percent since it revealed the
fabrication earlier this month. They rose 3.3 percent on
Tuesday, while the Nikkei 225 .225 ended unchanged.
The revelations have sent companies in global supply chains
scrambling to check whether the safety or performance of their
products has been compromised.
Japan's third-largest steelmaker on Monday pulled its
forecast for a first annual profit in three years as it tries to
deal with the financial impact of one of Japan's biggest
corporate scandals.
On Friday it had a government-sanctioned seal of quality
revoked on some of its products.
While no safety issues have been identified, Kobe Steel's
parts and materials are used across the world.
(Reporting by Yuka Obayashi; Writing by Aaron Sheldrick;
Editing by Christian Schmollinger and Jacqueline Wong)
((Yuka.Obayashi@thomsonreuters.com; +813-6441-1798; Reuters
Messaging: yuka.obayashi.thomsonreuters.com@reuters.net))
Keywords: KOBE STEEL SCANDAL/SHINSHO