Transport Ministry of Japan Raids Two Nissan Plants

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On Wednesday, the transport ministry of Japan said that it had carried out spot inspections at two plants that are producing Nissan vehicles as part of a probe into final checks. The move happened days after the automaker was forced to recall 1.2 million cars that were sold in Japan due to irregularities.

The ministry remarked that the two inspections that were carried out on Tuesday followed inspections at four other factories last week. The initial four discovered that the automaker had performed unauthorised final vehicle checks for most domestic models which had not yet been sold to the market, provoking Nissan to suspend new vehicle registrations with the government.

By Monday, the second-biggest automaker of Japan had discovered questionable checks of more vehicles. The company announced that it would recall all new passenger cars that were sold in Japan over the past three years.

This is the second major case of misconduct that involves a Japanese automaker in under two years after Mitsubishi confirmed that it tampered with fuel economy tests for some domestic-market models. Analysts said that while the recall is not likely to have a significant effect on profitability, it is a blow to the reputation of Nissan just as it enjoys strong domestic sales.

Sources say that in inspecting the factories of Nissan, the ministry discovered names of certified technicians that were used on documents to sign off final vehicle checks that were conducted by non-certified technicians.

It was possible that the said practice took place at most or all of the six plants said the people, who refused to be identified as they were unauthorised to speak with the media regarding the matter.

Vehicles that were sold in Japan must be registered with the government. As part of the said process, during final inspections, vehicles must undergo an additional procedure that was performed by plant technicians who can be accredited by the automakers.

Nissan verified that the latest two ministry inspections were held at its Tochigi plant and at the Auto Works Kyoto plant that is owned by an affiliate.

“We are currently conducting an investigation into the nature of this vehicle inspection issue at our plants,” said spokesman Nick Maxfield via an emailed statement. A third-party was said to also be involved in its probe.

The recall of Nissan includes all of the 386,000 new passenger vehicles that it has sold in Japan in 2016, roughly 10% of its global sales. However, it excludes Nissan-branded mini-vehicles that were produced by Mitsubishi Motors, which constitute roughly one-third of the annual domestic sales of Nissan.

The shares of the Nissan have decreased by more than 2% since Friday. They closed down at 1.2% on Wednesday at 1,089.5 yen.