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Japan's Kubota says it faked specifications for steelmaking tools

Whistleblower stepped forward in July to reveal practice going back at least to 2013

Kubota President Masatoshi Kimata, center, bows during a news conference announcing a longstanding product quality issue.

TOKYO -- Kubota on Wednesday announced that it has been attaching inaccurate inspection reports to some of its steelmaking equipment.

The Japanese machinery maker said employees delivered products that differed from the specifications which came along with them regarding hardness and alloy composition.

False documentation was given to 85 of the company's 99 customers around the world.

Kubota said it has identified no incident where the practice affected the quality of steel plates, the final product made with the suspect equipment.

The practice took place in the making of rolling mill rolls, used to process steel plates into thin sheets. Since there are no standard specifications for the tool, customers give Kubota their own specifications.

Kubota shipped about 21,000 units of the product from October 2013 to July 2018. The hardness specifications were falsified for 3,512 of these, as were the composition specifications for 121.

Rolling mill rolls with lower-than-specified hardness could weaken more quickly than what would be expected and require being replaced more frequently.

After a whistleblower came forward on July 25, Kubota started looking into the situation and commissioned a law firm to conduct an investigation. In late August, Kubota began telling customers that its had been delivering products that did not match their specifications. It did not explain the nature of the quality control lapse, pending further investigation.

It plans to investigate whether the same practice has been used in regard to other products made before October 2013.

"We sincerely apologize for giving so much trouble to our customers as well as interested parties," Kubota President Masatoshi Kimata said at a news conference.

He added the company has yet to determine the matter's impact on Kubota's earnings. "Many uncertain factors remain," he said.

Kubota makes rolling mill rolls at a plant in Amagasaki, in the western prefecture of Hyogo. The product contributed some 4.4 billion yen ($39.5 million) in sales in fiscal 2017. Kubota estimates its share in the global market for rolling mill rolls is 2% to 3%.

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