Morgan Stanley on Nidec (6594.T): Quality-Issue Press Conference Summary
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Morgan Stanley summarized Nidec's two September 4 briefings on its quality issues—a 3pm investigation-committee session and a 5pm management press conference—covering CEO Kishida's remarks and Q&A. A committee of external experts led by independent lawyers, established May 13, surveyed all 97,663 employees and executives and identified 844 quality-related misconduct cases: 60 major and 784 general. The company found no issues affecting product safety or with material financial impact; only two customer discussions over product functionality remain open. Root causes mirror accounting-fraud patterns—excessive pressure to hit targets—plus quality-specific weaknesses: a lack of independence in quality-assurance functions and no unified group-wide quality oversight framework, including acquired subsidiaries. Next milestones: the F3/26 securities report and restatements of the past five fiscal years plus an internal-control report on September 30; an internal-control confirmation report to the TSE in late October; F3/27 Q1 and Q2 results by November 13; and an updated five-year mid-term plan covering F3/27–F3/31 in late December. Japan's SESC had requested materials under the Financial Instruments and Exchange Act. Nidec is Not-Rated with an In-Line industry view, no target price, a ¥2,611 close on September 4 and market capitalization of ¥3,000.6bn.