NASHVILLE, Tenn.—Bridgestone/Firestone has agreed to pay Ford Motor Co. $240 million to settle all remaining Ford Explorer-related financial issues, closing the book on the dispute between the two companies, according to both firms.
Despite the settlement, neither company plans to start doing business with the other again in North America, according to BFS and Ford spokespeople.
The agreement settles the claims not only on the August 2000 recall of 6.5 million Firestone ATX, ATX II and Wilderness AT tires, but also Ford´s unilateral action in May 2001 to replace 13 million Firestone Wilderness AT tires. That decision caused then-BFS Chairman John Lampe to sever all ties with Ford the day before Ford went public with it.
Neither BFS nor Ford admits any responsibility in the compromise settlement, according to both companies. A BFS spokeswoman said the tire maker has spent $440 million to date on recall-related costs, not including the agreement with Ford.
A Houston television station first began airing reports of fatal accidents involving Ford Explorers equipped with Firestone tires in February 2000. Investigating the issue, the National Highway Traffic Safety Administration eventually attributed 271 deaths to tread separations on these vehicles.
Then-Ford CEO Jacques Nasser was quick to attribute all blame to BFS, and Masatoshi Ono, who then headed BFS, accepted blame on behalf of the company. But Lampe, who soon replaced Ono, insisted that the design of the Ford Explorer was partly responsible.
After officially severing ties with Ford, BFS continued to honor its existing North American contracts with the auto maker, making its last tire delivery April 1, 2003.
In a speech at the Chicago Auto Show in March 2004, incoming BFS CEO Mark Emkes said his company had reopened lines of communication with Ford, but didn´t foresee resuming business with the auto maker any time soon.
Spokespeople for both companies reaffirmed Emkes´ statement Oct. 12, the day the settlement was announced. The BFS spokeswoman, however, noted Bridgestone Corp., BFS´s parent firm, never stopped doing business with Ford in Latin America, Europe and Asia.
The controversy over the Explorer-Firestone issue led directly to congressional passage of the Transportation Recall Enhancement, Accountability and Documentation Act in October 2000. It also spawned thousands of product liability and class action lawsuits against both companies.
The $240 million settlement has nothing to do with the litigation, a Ford spokeswoman said. "There are class action suits still pending against the company, but we expect those to be dismissed," she said.
BFS has settled more than 2,100 Explorer-related suits, the spokeswoman said.