Kobe steel’s data scandal shows cost of race to improve metals

Kobe steel’s data scandal shows cost of race to improve metals
21/10/2017 , by , in ALLIED

Behind the scandal engulfing Kobe Steel over the falsification of data for some of the materials it supplied is a harsh reality for Japanese steel companies: the need to provide higher and higher quality metals to compete.

Kobe Steel rocked Japan’s industrial economy with revelations this week that it faked data on the quality of some aluminum, copper and iron powder sales. Chief Executive Officer Hiroya Kawasaki said more cases could emerge as the company continues its investigations.

Among those affected are automakers — among the biggest customers for steel producers — who have been seeking more advanced products to cut weight while retaining strength and versatility.

“The steelmakers are really trying to protect their turf, because this is a life-and-death situation for them,” said Thanh Ha Pham, senior vice president in Japan for investment bank Jefferies Group LLC. “It’s improve or die.”

The trade-off for carmakers between a vehicle that’s strong enough to be safe but light enough to be energy-efficient has led to an array of alloys and efforts to break the dominance of steel, from McLaren’s iconic carbon-fiber F1 supercar in the 1990s to Ford Motor’s decision to switch its venerable F150 pick-up to aluminum in 2015.

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