OSAKA — Sanyo Electric Co. President Sadao Kondo expressed his intention to resign Tuesday in an effort to take responsibility for the sale of defective solar cell systems by a subsidiary.
The move came hours after International Trade and Industry Minister Takeo Hiranuma urged Kondo to resign, or take responsibility by other means, for Sanyo Electric Clean Energy System Co.’s submitting of fabricated reports to the ministry regarding the defect.
Sanyo Electric has dismissed the subsidiary’s president, Minoru Hagiwara, for allowing the sale of the systems despite knowing of their inability to generate sufficient electricity.
Speaking at a news conference, Kondo said he had submitted his resignation letter to chairman Satoshi Iue earlier in the day and that he was told the matter will be decided at the company’s executive meeting on Friday.
“I have decided to resign to take responsibility for causing great trouble to our customers, shareholders and those who are making efforts in the promotion of solar power systems,” Kondo said. “I hope my resignation will help recover public confidence in the company.”
Kondo said Friday that he learned last month, through a MITI notice, that the subsidiary’s solar cell products included defective low-capacity panels, despite the fact that complaints about the malfunctioning products were first made two years ago.
Sanyo officials explained that the company had trusted in a report by the subsidiary denying the claim, and had failed to investigate any further.
An in-house investigation found that some 5,476 of 23,560 solar cell systems made by the subsidiary from November 1996 to March 1998 were not capable of generating electricity, as was claimed by the subsidiary.
Sanyo has said it will recall the defective systems and have them replaced with new ones.
Masatoshi Iguchi, head of a nongovernmental organization representing some 50,000 users of solar cell systems, called Kondo’s resignation “natural.”
“As solar power generation is a promising field, Sanyo should pull itself together and make a fresh start,” he said.
In a related development, Sanyo is considering absorbing the subsidiary to strengthen the supervision of its operations, company officials said.
One of Sanyo’s in-house companies, Soft Energy Co., which manufactures solar cells, will probably take over the sales company’s operations, the officials said.
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