Nidec Probe Uncovers 844 Quality-Control Violations
Nidec Probe Uncovers 844 Quality-Control Violations
The News
Nidec Corp., the Japanese motor maker whose products sit inside pumps, air conditioners, robots and car parts, said Friday that an internal investigation found 844 cases of quality-control misconduct stretching back as far as 2012.
Chief Executive Mitsuya Kishida bowed deeply at a Tokyo news conference and apologized to investors, group companies, customers and society at large. "The entire company is working hard to review and improve our quality controls," he said.
Most of the cases involved changing product materials or manufacturing processes without approval, according to Nidec. Others involved faking product tests and false labeling, including where a product originated.
The Numbers
844 confirmed cases of misconduct. More than 1,000 suspected cases were disclosed earlier, covering 2020 through 2025, according to the Japan Times. Nidec employs more than 100,000 people. Its stock, which has fallen to about half its value from five years ago, rose 5.7% Friday.
Timeline
Nidec is founded in a small hut in Kyoto by Shigenobu Nagamori, who became a billionaire and later started a foundation to promote international engineering research.
The earliest misconduct identified by the investigation dates to this year, according to the company's findings.
The period covered by the more than 1,000 suspected quality irregularities Nidec disclosed, the Japan Times reported.
Accounting fraud surfaces at the company, the event that set the quality investigation in motion.
Nidec sets up the investigative panel after disclosing the suspected cases.
The company releases the findings: 844 cases of quality-control misconduct. Nidec shares rise 5.7%.
Reactions
Kishida called the problems a strike at what is "at the heart of a manufacturer," but stressed that no safety problems tied to the wrongdoing have been found so far and that there will be no massive recalls.
Senior Vice President Masayuki Minai promised tougher governance and compliance, and said the company wants every worker to feel accountable. "Speak up. Bad news first," he said in English.
Company officials said almost all the cases were carried out by workers who felt intense pressure to deliver results and wanted to do a good job. The behavior appears to have started as Nidec expanded rapidly, pushing employees to move fast and cut costs.
What's Next
Nidec says it is overhauling its quality-control review and beefing up compliance, with no recalls planned. The investigation did not release details of the individual cases, leaving open how far customers and regulators will press for specifics on which products and which plants were affected.
More
Nidec is the latest name on a long list of Japanese manufacturers caught faking data. Kobe Steel acknowledged massive faked inspections in 2017, the same year fiber maker Toray admitted to data tampering. In 2016, Mitsubishi Motors said employees falsified fuel mileage data; the automaker had already been through a major defect cover-up scandal in the early 2000s.
The company's rise is a familiar Japanese story — a small workshop grown into a global supplier, part of the country's prized "monozukuri," or making things with care and pride. Some analysts argue that overly strict internal rules and standards are exactly what push workers on the factory floor to cover up mistakes.
Poll
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