Ford-Firestone Tire Recall ETM627 Joey Moore – 12/2/2014

Product Recall What: Firestone ATX, ATX II, and Wilderness AT tires Recall Date: August 9, 2000 [4] Why: High instance of failure (tread separation causing rollover) for Firestone Wilderness AT, ATX, and ATX II tires. Incidents particularly high for Ford Explorer and similar vehicles including Mercury Mountaineer, Mazda Navajo, and certain Ford and Mazda trucks. [4] Two thirds of the failing tires were reported to be installed on new Ford vehicles. [3] ETM627 Joey Moore - 12/2/2014

Product Recall Incidents: May 12 – July 3, 1999, 5 fatalities occurred due to tread separation on Ford Explorers with Firestone tires in the Jacksonville metropolitan area. [8] Including these, there had been a total of 46 fatalities before the recall. On August 13, 2000, two Ford Explorers in the state of Florida experienced blowouts as Ford ran a full page newspaper ad suggesting that its vehicles were safe when equipped with Firestone tires. [2] The majority of the U.S. incidents occurred in warmer Southern states. Number of Units Sold: 6.5 Million (Second Largest Tire Recall in U.S. History; 1st belonged to Firestone as well) [4] When Sold: 1991 to 2000 [4] ETM627 Joey Moore – 12/2/2014

Management Issues Recognition of Problem: July 28, 2000 – After a growing number of complaints and lawsuits, Ford requested data from Firestone, then performed their own analysis and determined that there was a problem with all ATX and ATXII tires, as well as, Wilderness AT tires produced at the Decatur Illinois plant. [1] August 3, 2000 – National Highway Traffic Safety Administration (NHTSA) opened investigation after receiving 193 complaints [2] August 9, 2000 – Firestone issued recall for 2.6 million tires Speed of Response: After performing its own analysis on data supplied by Firestone, Ford determined that there had been an unusually high instance of failures on the recalled tires identified by the number of complaints Firestone received in the time period from 1997 - 1999. Early on, Firestone also tried to draw attention to possible design problems with the Ford Explorer that could also be blamed for the problem. Ultimately, the recall did not occur until after the NHTSA opened its investigation. At this point there had been “50 lawsuits, 46 deaths, and 80 injuries.” [3] ETM627 Joey Moore – 12/2/2014

Management Issues Responsibility: Design Problems with Ford Explorer Ford documented stability problems with Explorer causing rollover in early development testing [6] This fact was acknowledged by Ralph Hoar, founder of Safetyforum.com at beginning of controversy. [1] Safetyforum.com was a consulting firm responsible for coordinating law suits and may have had vested interest in involving Ford. Ford determined the Wilderness AT tires should be maintained at 26 psi instead of 30 psi per Bridgestone specs [5] Lack of Quality Control at Firestone Factories Ford was “disturbed to learn that Bridgestone had done little to analyze the quality of its tires.” [1] Labor Strike at Firestone Decatur Plant Ford’s analysis pointed to problems in tires produced in the Decatur plant during the time period of a labor strike which required Firestone to use replacement workers. [1] Problems outside of U.S. ignored Tires were replaced before recall in Venezuela and 15 other countries on similar vehicles [7] ETM627 Joey Moore – 12/2/2014

Engineering Analysis While the blame game between Ford and Firestone, coupled with the desire for each company to settle its pending lawsuits in its own best interest created a significant barrier to any root cause analysis, it seems clear from the available statistics and mechanical analysis that the combination of specific vehicle and tire was lethal. Ford Explorer – High center of gravity and proven rollover potential from early Ford engineering tests. Ford had its own concerns as indicated by decision to adjusted tire pressure recommendation. Firestone ATX, ATX II, and Wilderness AT – Potential to develop cracks between tread belt and sidewall while experiencing centrifugal force associated with highway speed, possibly caused by rubber “belt wedge” that showed statistically significant variation in width from tire to tire. [7] Combination – Tire blowout at highway speed causing increased likelihood of rollover. ETM627 Joey Moore – 12/2/2014

Impact of Recall Legal Consequences: Firestone eventually settled with Ford for $240 Million to cover tires replaced on vehicles. [9] Reputation: Initially, the blame passing between the two companies created a rift in a relationship dating back to “when Henry Ford was still designing the first model T.” [1] For the First time in Ford’s history, the company decided to part ways with Firestone. This separation was short-lived, however, as Firestone currently provides tires for many new Ford vehicles. Both Ford and Firestone suffered brand association problems from the problem. Sales: Ford Motor Company lost 19% in sales ($900 Million) as of settlement in 2005. [9] No estimates available on Firestone Sales. ETM627 Joey Moore – 12/2/2014

References ETM627 Joey Moore – 12/2/2014 [1] Bradsher, Keith. (2000). Ford says Firestone was Aware of Flaw in Its Tires by 1997. New York Times. Retrieved Nov 28, 2014 from: http://www.nytimes.com/2000/08/14/business/ford-says-firestone-was-aware-of- flaw-in-its-tires-by-1997.html. [2] CNNMoney. (2000). Firestone recall timeline. Retrieved Nov 29, 2014 from: http://money.cnn.com/2000/08/30/news/firestone_chronology. [3] Wald, Matthew L. (2000). Tread Failures Lead to Recall of 6.5 Million Firestone Tires. New York Times. Retrieved Nov 28, 2014 from: http://www.nytimes.com/2000/08/10/business/tread-failures-lead-to-recall-of-6.5- million-firestone-tires.html. [4] National Highway Traffic Safety Administration. (2000). Firestone Tire Recall. Retrieved Nov 28, 2014 from: http://www.nhtsa.gov/PR/FirestoneRecall. [5] Simison, Robert L., Lundegaard, Karen, Shirouzu, Norihiko, and Heller, Jenny. (2000). How a Tire Problem Became a Crisis for Firestone, Ford. Retrieved Nov 30, 2014 from: http://online.wsj.com/articles/SB965870212891028108. [6] Wikipedia. (2014). Firestone and Ford Tire Controversy. Retrieved Nov 28, 2014 from: http://en.wikipedia.org/wiki/Firestone_and_Ford_tire_controversy. [7] National Highway Traffic Safety Administration. (2001). Engineering Analysis Report and Initial Decision regarding EA00-023: Firestone Wilderness AT Tires. Retrieved 11/30/2014 from: http://www.nhtsa.gov/nhtsa/announce/press/Firestone/firestonesummary.html. [8] Pinkham, Paul, Deringer, Kate. (2000). More fatal wrecks blamed on bad tires. The Florida Time-Union. Retrieved Nov 30, 2014 from: http://jacksonville.com/tu-online/stories/081500/met_3801795.html. [9] Roberts, Joel. (2005). Firestone Tire Settles with Ford. Retrieved Nov 30, 2014 from: http://www.cbsnews.com/news/firestone-tire-settles-with-ford/ ETM627 Joey Moore – 12/2/2014