Ford and Firestone

This case involves Ford and the Japanese tire manufacturer, Bridgestone/Firestone. The Ford Explorers which were prone to rolling over, came equipped with Firestone defected tires. The tire seemed to have a defect that caused the tread to separate from the whole of the tire and cause the vehicle to flip. Although Firestone knew about such defects, they continued to produce despite knowing the deadly consequences that lay behind their actions. The Explorer also had a bad reputation of rolling over and Ford knew it.

As a result, fatal accidents occurred from these two combinations. Since this was a very serious safety issue, Ford and Firestone were ordering the recall of problem tires in Saudi Arabia, Venezuela and Asia but not in the United States. So, did the company act ethically in resolving this crisis? No, the companies failed to fix the problem in the United States. According to NHTSA, the tires have caused many deaths and injuries in the United States.

In fact, these accidents would have not occurred if both companies have solved the problem immediately. Thus, despite the obvious safety issues, there were also fundamental ethical issues. 2. STATEMENT OF THE PROBLEM In May 2000, the U. S. National Highway Traffic Safety Administration (NHTSA) contacted Ford and Firestone about the high incidence of tire failure on Ford Explorers, Mercury Mountaineers, andMazda Navajos fitted with Firestone tires.

Ford investigated and found that several models of 15-inch Firestone tires (ATX, ATX II, and Wilderness AT) had very high failure rates, especially those made at Firestone’s Decatur, Illinois plant. This was one of the leading factors to the closing of the Decatur plant Joan Claybrook, who was the president of the public advocacy group Public Citizen and previously an Administrator of the NHTSA, stated before the Transportation Subcommittee United States Senate Committee on Appropriations on September 6, 2000, that, “there was a documented coverup by Ford and Firestone of the 500 defect”.

Also Clarence Ditlow; Executive Director for the Centre for Auto Safety in his statement before the Senate Committee on Commerce, Science and Transportation in Washington D. C. , September 20, 2000[2] stated “Emerging Information shows that both Ford and Firestone had early knowledge of tread separation in Firestone Tires fitted to Ford Explorer vehicles but at no point informed the NHTSA of their findings”. 3. OBJECTIVES The Ford Explorer was first offered for sale in March 1990.

Ford internal documents show the company engineers recommended changes to the vehicle design after it rolled over in company tests prior to introduction, but other than a few minor changes, the suspension and track width were not changed. Instead, Ford, which sets the specifications for the manufacture of its tires, decided to remove air from the tires, lowering the recommended pressure to 26 psi. The maximum pressure stamped into the sidewall of the tire was 35 psi;however tires should only be inflated to the pressure listed by the vehicle’s manufacturer.

————————————————- End of Ford/Firestone relation John T. Lampe (Chairman & CEO of Bridgestone/Firestone) announced in a 2001 letter to Jacques Nasser (Ford Motor Company Chief Executive) that Bridgestone/Firestone would no longer enter into new contracts with Ford Motor Company, effectively ending a 100-year supply relationship. [8] 4. ALTERNATIVE CAUSE OF ACTION Ford and Firestone have both blamed the other for the failures, which has led to the severing of relations between the two companies.

Firestone has claimed that they have found no faults in design nor manufacture, and that failures have been caused by Ford’s recommended tire pressure being too low and the Explorer’s design. Ford, meanwhile, point out that Goodyear tires to the same specification have a spotless safety record when installed on the Explorer, although an extra liner was included into the Goodyear design after recommendations to that effect were made to Ford. Firestone included an extra liner in its product and this was then also used to replace tires on Ford Explorers.

It is well accepted within the tire manufacturing industry that use of a “belt edge layer” or as referred above as an extra layer, virtually eliminates belt edge separation. As a rubber tire moves on the road, it generates tremendous heat. As steel belts heat up, they expand and want to pull away or separate from rubber. The use of nylon belt edges has been in use since radial tires were first developed in the 1970s. Nylon, when heated, actually constricts in size; thus keeping the belt edge integrity. Firestone could achieve cost savings from eliminating this extra layer. 5.

FINDINGS SOLOTION AND RECOMMENDATION A product recall was announced, allowing Explorer owners (and owners of its stablemates) to change the affected tires for others. Many of the recalled tires had been manufactured during a period of strike at Firestone. [7] A large number of lawsuits have been filed against both Ford and Firestone, some unsuccessful, some settled out of court, and a few successful. Lawyers for the plaintiffs have argued that both Ford and Firestone knew of the dangers but did nothing, and that specifically Ford knew that the Explorer was highly prone to rollovers.

Ford denies these allegations. Car and Driver magazine tested a first-generation Explorer with a built-in roll cage and a special device that would flatten the tire at the push of a button. While driven by professionals on a closed track, the Explorer did not flip in any of the numerous tests. However the results of this test were dubious since Car and Driver’s test was for a very rapid deflation of the tire, when the accidents were caused by tread separation and not rapid deflation.