Misconduct ‘became normal at Nissan’

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Nissan Motor Co.’s Oppama plant in Yokosuka, Kanagawa Prefecture, on Sept. 19. (The Yomiuri Shimbun/ANN)

TOKYO (The Japan News/ANN) – The report Nissan Motor Co. released Friday on its use of unqualified workers in final vehicle inspections has revealed its corporate culture, in which no one spoke up about the misconduct although many employees involved in the inspections were aware that laws and regulations were being violated.

The report also attributed the misconduct to the fact that senior staff at its plants and headquarters were not aware of the day-to-day operations. The automaker’s executives are heavily responsible for allowing the wrongdoing to become a normal practice.

Systematic Corner-Cutting

The report revealed the manner in which the unqualified inspections were practiced on an everyday basis and how lax the exams to qualify inspectors were.

The misconduct was concealed by removing unqualified inspectors — who usually conducted final inspections — from the final inspection line during regular audits by the Land, Infrastructure, Transport and Tourism Ministry and other entities, according to the report.

The report also said that the “answers were distributed with the exam papers” in exams to qualify inspectors.

The number of final inspectors at Nissan plants was not enough to keep up with the pace of day-to-day production, and part of the inspections were conducted by unqualified workers who were in training to become inspectors.

The inspectors in training borrowed final inspector name stamps from a registered final inspector and used them to stamp inspection sheets. They systematically carried out the wrongdoing even to the extent of making a ledger to manage the stamps.

At Nissan’s plant in the Kyushu region, when a final inspector in training became able to carry out the final inspection alone, his achievement was often called “hitoridachi” or independence.

Closed Atmosphere

The report pointed to a shortage of final inspectors as a cause and background of the wrong practice. According to the report, the Nissan headquarters did not take into account that “a number of months were required to train a final inspector and that instructors were necessary to train and supervise final inspectors in training.”

The automaker’s plants had no surplus in the number of final inspectors, Nissan President Hiroto Saikawa admitted at a press conference.

Moreover, the company’s internal whistleblowing system did not function. “I was afraid of being retaliated against if I blew the whistle,” a final inspector told Nissan’s fact-finding investigators, an illustration of how badly closed the working environment was.

A senior staff member of another major auto company said: “I once proposed that workers without proper qualification should also be allowed to conduct final inspections, but the proposal was rejected by workers [involved in inspections]. ‘Laws and regulations do not allow us to do so as [final inspections] are entrusted [to us] by the government,’ they said.”

Many experts believe that the problem resides in Nissan’s corporate culture.

Workers in a Corner

The shortage of qualified inspectors has become especially significant due to the expansion of production in recent years.

The company’s Oppama plant in Yokosuka, Kanagawa Prefecture, for example, took over production of Note compact cars in August 2016 from another Nissan plant, and the plant shifted from one shift system only in the daytime to a day-night, two-shift schedule. This had led to a manpower shortage, many of the final inspectors said.

The transfer of Note production to the Oppama plant was a key decision for the automaker with a view to producing 1 million vehicles in Japan. The report suggested a line of thinking that the management’s decision pushed workers into a corner, saying that the situation was such that it was inconceivable for the Oppama plant to refuse the transfer.

Nissan went under the umbrella of French automaker Renault SA after falling into a management crisis in 1999, and Carlos Ghosn, current Nissan chairman, effectively took the helm of the ailing automaker. By thoroughly taking such measures as cost cutting and a “commitment”-oriented management style, Ghosn has improved the company’s performance.

According to the report, Nissan employees expressed the opinion that final inspections should not have been subject to cost-cutting measures. But Saikawa denied that Ghosn’s management style invited the misconduct, saying the misconduct had existed since earlier years.

Mind-Set Needs Reform

Some accuse the report of lacking commitment for failing to specify when the misconduct started and identifying the involvement of executives and those in managerial positions.

The short period given for the investigation may have invited such an accusation. In the 2016 Mitsubishi Motors Corp. scandal over fuel efficiency manipulation, a special investigation committee of lawyers and other members spent three months on the probe. However, the latest Nissan investigation team spent only one month.

A person concerned said: “The time is not enough to find out real reasons [for the misconduct]. The investigation results will be unsatisfactory.”

Meanwhile, lawyers involved in the Nissan investigation harshly criticized its corporate culture. They attributed the prolonged misconduct to the low awareness of Nissan headquarters and senior staff at its plants over the final inspection system. “The responsibilities of people concerned at Nissan’s head office — especially its executives — as well as senior staff at its plants, are extremely heavy,” they said.

“Incidents similar to this case may occur sooner or later without fundamentally reforming [the company’s] mind-set,” they warned.

By Ko Yoshida, Ayaka Kudo