OSAKA – Toyo Tire & Rubber Co. Chairman Akira Nobuki and President Takuji Yamamoto are considering resigning following a scandal in which the company installed substandard earthquake shock absorption devices in some buildings, sources said Thursday.
Nobuki, 60, is likely to step down soon, while Yamamoto, 58, will depart in the fall at the earliest, the sources said.
Toyo Tire needs to revamp management to restore public confidence hurt by a spate of recent revelations that it had falsified data on its devices. It is expected to announce preventive measures by the end of this month.
A new president could be picked at an extraordinary shareholders’ meeting this fall, the sources said. But it is possible that Yamamoto’s resignation will be delayed until an annual shareholders’ meeting expected to be held sometime around next March, they said.
Yamamoto took over the role of president from Nobuki last November.
The change in leadership is yet another blow to the Osaka-based firm, whose previous president was forced to step down in 2007 after the company was found to have fabricated performance of its fireproof heat insulation panel products.
Toyo Tire has so far confirmed that 145 buildings, including public facilities such as schools and hospitals, have been built with substandard seismic isolation devices, while the performance of devices used in nine buildings could not be verified.
The company says its checks have found that the buildings will not collapse in the event of an earthquake registering around 7 on the Japanese intensity scale, the level recorded for the 1995 Great Hanshin Earthquake in western Japan and the March 2011 earthquake in the Tohoku region. The scale runs from zero to 7.
In May, Toyo Tire said it had booked a special loss of ¥14 billion to cover the cost of replacing the defective products.
The scandal came to light in March when the government withdrew its certification for the company’s equipment because it did not meet requirements to absorb the shock of earthquakes.