Nissan share price falls on vehicle recall news

Japanese automaker Nissan is recalling 1.2 million vehicles across Japan after it came to light final vehicle inspections weren't properly conducted or signed off.

Nissan share price falls on vehicle recall news

Carmaker Nissan has announced it is recalling 1.2 million cars that have already been approved for the Japanese market. The Nissan share price fell on the news which showed it was discovered the final vehicle checks made on those cars weren’t performed by correctly authorised staff members.

Nissan is Japan’s second biggest automaker and the recall could cost the company around 25 billion yen, or £165 million.

In a press release, Nissan said: “Approximately 1,210,000 units produced between October 2014 and September 2017 will be subject to re-inspection.”

The auto giant was also investigating how the inspection mishap occurred.

“A team that includes an independent third party is currently investigating the causes and measures to prevent recurrence,” the press release read. Adding: “Nissan regrets any inconvenience and concern this has caused to its valued customers in Japan. Nissan is taking proactive action to resolve this matter.”

During a press conference, Hiroto Saikawa, Nissan’s Chief Executive, said the inspection problem had happened at all of Nissan’s six plants across Japan.

The problem only affects vehicles sold in Japan and not those on the international market.

The news saw the Nissan share price tumble as investors sought to sell the stock. The press release follows news last week that the carmaker said 60,000 of its cars hadn’t been through properly authorised checks before being released for sale.

Nissan temporarily stopped registering new vehicles in Japan last week following notification from the Japanese Government of inspection detail irregularities.

This latest news follows a series of problems in the global auto industry. In 2015 German carmaker Volkswagen admitted it had fitted some diesel engines with software to cheat emissions tests.

In January 2017, Ford South Africa recalled 4,556 Kuga models after around 50 of the cars experienced engine bay fires. And, in 2015 GM agreed to pay $900 million after faulty ignition switches were linked to 169 deaths.

Top Equities Brokers

0 Brokers added for comparison:
Clear all