Ford Motor Company (F) Pays Maximum Fine Over Escape Recall

Ford Motor Company (NYSE:F) said in a statement that it agreed in June to pay the fine to avoid a protracted dispute with NHTSA. Spokeswoman Kelli Felker said Ford faced a complex situation with a low number of complaints. The problem was compounded by improper repairs made to the vehicles, she said.

“We are absolutely committed to addressing potential vehicle issues and responding quickly for our customers,” Felker said Thursday.

On the older Escapes the cruise control cables can snag on the plastic cover atop the engine and cause the gas pedals to stick. For the problem to happen, the pedals must be pushed to or near the floor, and the cruise control cables must have been bent or moved from their original position, Ford Motor Company (NYSE:F) said at the time. Cable positions can be changed when the SUVs are serviced, the company noted.

The Escape was redesigned after the 2012 model year,

Dealers were to replace the fasteners on the engine cover, raising them so there’s plenty of room for the cruise control cable.

NHTSA said when the Escapes were recalled that investigators would look into whether the sticky throttles could have been caused by repairs made as part of a 2004 accelerator cable recall.

Felker urged Escape owners who have not had their SUVs repaired to take them to a dealer as soon as possible.

Claybrook said it’s clear that Ford realized it made a mistake. “It’s really important for the agency to penalize these companies for not being timely,” she said.

Last December, Toyota paid a $17.35 million fine for failing to quickly report problems to NHTSA and for delaying a safety recall. At the time, it was the largest single fine ever assessed against a car company over safety defects. In 2010, Toyota paid a total of $48.8 million in fines for three similar violations.

The fines are a tiny fraction of both companies’ earnings. Last week Ford said it made $1.23 billion in the second quarter, while Toyota made $3.2 billion in the first quarter.

A key difference between the two cases is that Ford doesn’t appear to have fought the fine the way Toyota did, Claybrook said.

“If you’re going to have a fight with a government agency, be sure you have good grounds to have that fight,” she said. “Toyota made a lot of mistakes. Ford Motor Company (NYSE:F) is shrewder. They just didn’t want to have that fight.”

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