Japan's bullet train's track record of zero safety problems was tarnished when a crack and an oil leak were found on a shinkansen that was pulled out of service midway on Monday.

But the early discovery of the faults means Japan has kept its record of no fatalities or injuries to passengers since the shinkansen began operations in 1964.

Still, the Japan Transport Safety Board, in announcing an inquiry yesterday, used the label "serious incident" for the first time.

The Nozomi 34 service had suffered a "structural anomaly" that measured over 10cm, the board said. It could have led to a deadly high-speed derailment.

Experts, however, were optimistic the incident would not affect Japan's international bids for major high-speed rail projects.

Corporate governance expert Martin Schulz of the Fujitsu Research Institute told The Straits Times: "Japan has an unchallenged record of accident-free, high-speed train operations, and this incident fortunately did not break the safe run because it was discovered in time."

He added: "I very much doubt it will have any negative impact on Japan's overseas railway projects, which often are decided by complex policy considerations, and not just quality and cost-performance concerns."

Nozomi 34 begins its east-bound five-hour journey from Hakata station in downtown Fukuoka in the south-west, and ends at the central Tokyo station. The journey also covers the Osaka-Tokyo route that is Japan's busiest.

Monday's incident occurred despite no abnormalities being found during a sight inspection by rail operator West Japan Railway (more commonly known as JR West) the day before.

No irregularities were also uncovered during a Nov 30 check on the train's motors, nor in February when parts were dissembled and the chassis and wheels separated for a thorough examination.

But the news is a further blow to Japan Inc's reputation for safety and reliability, following a spate of corporate governance and quality control scandals.

In October, Kobe Steel confessed to faking data about the strength and durability of some aluminium and copper products.

Although it supplied substandard parts to bullet train operators, no direct causation has been found between the Nozomi 34 incident and the Kobe Steel scandal.

The compromised material, with tensile strength below industry standards, did not pose any safety risk, JR West and JR Central (Central Japan Railway) had said.

Monday's incident arose when Nozomi 34's crew noticed a burning smell at Kokura station in Fukuoka, minutes after it left the Hakata terminal station at 1.33pm.

A maintenance crew boarded the train at Okayama station in western Japan. They reported an "abnormal motor sound", but judged it would not affect train operations and decided to continue the service.

The burning odour was detected again at 4.20pm as the train neared Kyoto and it was pulled from service at 5pm when an oil leak was found when the train reached Nagoya station. This was 31/2 hours after it had departed from Hakata.

About 1,000 passengers were affected, JR West said.

Local media reports said "abnormal pressure" might have damaged the couplings between the motors and the wheels, which were found to be slightly discoloured. A crack was also found on the steel frame beneath the fourth carriage.

The Japan Transport Safety Board said a damaged steel frame would have affected the wheel shafts and, in turn, could have led to the train's derailment.

JR West had carried out an emergency probe into 129 other undercarriages manufactured at the same time as Nozomi 34, and had found no irregularities.