In a move to blunt consumer ire over a massive tire recall, Ford Motor Co. said Monday it will halt production at three truck plants for two weeks and divert 70,000 tires from those plants to vehicle owners who are scrambling to find replacements for the 6.5 million tires recalled.
Bridgestone/Firestone Inc. has recalled P235/75R15 ATX and ATX II tires, and Wilderness AT tires made at its Decatur, Ill., plant. The National Highway Traffic Safety Administration is investigating the tires in connection with 62 deaths and more than 100 injuries.
The 15-inch tires primarily are used on Ford Explorer and Mercury Mountaineer vehicles.
Ford Chief Executive Jac Nasser was scheduled to explain the announcement in a TV ad running during ABC’s “Monday Night Football.”
“You have my personal guarantee that all of the resources of Ford Motor Co. are being directed to resolve this situation,” Nasser says in the ad.
The companies have previously said their data show the tires under recall are the source of hundreds of complaints about treads separating while vehicles are in motion, sometimes at high speeds. Most of the 15-inch tires were installed on Ford trucks, including the popular Explorer sport-utility vehicle.
Ford said it will take its assembly plants in St. Paul, Edison, N.J., and Hazelwood, Mo., off-line on Monday, with production resuming Sept. 10, said spokeswoman Della DiPietro. Tires from those assembly plants will be shipped to Ford and Lincoln/Mercury dealers, DiPietro said.
DiPietro said the temporary plant closure would cut 10,000 Rangers and 15,000 Explorers/Mountaineers from Ford’s production. The plants employ about 6,000 workers, who will be paid, DiPietro said.
Burnham Securities analyst David Healy said the action could trim $100 million to $200 million from Ford’s third-quarter earnings, which analysts expected to be $1.3 billion to $1.4 billion before Monday’s announcement.
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“Basically, they’ll be taking a 10 percent cut,” Healy said. Patrick Dunkerley, an analyst with Securities Corp. of Iowa, in Cedar Rapids, said Ford would suffer more with the loss of Explorer production. “The Ranger is a lower margin product, so losing 10,000 Rangers won’t be that big a deal.”
Shares of Ford Motor Co., closed at $27.25, down 50 cents on the New York Stock Exchange.
DiPietro said the shutdown was not expected to strongly affect Explorer or Ranger sales, though Ford said Monday Explorer sales are slightly down since the recall began. Yet Ford executives reported that Explorer sales were at 97 percent of their objective for the month, higher than any other Ford product.
“Right now we are keeping up with the sales of August ’99,” DiPietro said. “We have an ample supply of both products.”
Also Monday, a safety group filed a lawsuit seeking to force Bridgestone/Firestone and Ford to widen the recall beyond the original 6.5 million tires.
The Center for Auto Safety contends that all Firestone radial ATX, ATX II and Wilderness AT tires are defective and should be recalled, regardless of their size or where they were made.
“We believe the design of the tire is defective, and if the tires are defective, all of them should be recalled,” said Clarence Ditlow, the group’s executive director.
Ditlow said the problems derive from the tire design and not from quality control problems at the Decatur plant.
“Other brands made in the [Decatur] plant haven’t had problems,” Ditlow said. “So if there’s a quality-control problem, other brands made in the very same plant with the very same workers would have problems. They’re either all bad or all good.”
Ford and Bridgestone/Firestone have 30 days to respond.
A Ford spokesman said an expanded recall would delay getting replacement tires to the customers who need them.