Ford knowingly launched the Focus, Fiesta with defective transmissions, a Detroit Free Press investigation finds
Detroit Free PressFord Motor Co. knowingly launched two low-priced, fuel-efficient cars with defective transmissions and continued selling the troubled Focus and Fiesta despite thousands of complaints and an avalanche of repairs, a Free Press investigation found.
The automaker faces thousands of angry customers, including former loyalists who say they will never buy another Ford; hundreds of millions in repair costs, many times without actually fixing the cars; and litigation so serious the company this spring warned investors of the financial threat posed by defects in what Ford called its DPS6 transmission.
A lineup of Ford Focus vehicles is seen on an assembly line prior to a speech by US President Barack Obama about the automotive manufacturing industry at the Ford Michigan Assembly Plant in Wayne, Michigan, January 7, 2015.
By the time of the 2012 review, which was labeled “Lessons Learned,” Ford had sold more than half a million of the cars. “We also cannot achieve a driveable calibration that will get us to production,” he wrote. “The clutch torque delivery MUST BE IMPROVED.” “What is it going to take? Does someone have to die before they get these cars fixed?” asked Carrie Armstrong, 42, of Hendersonville, Tennessee. “When I am on the interstate and almost get hit by a diesel truck just because my car will not accelerate and get into gear? I put my life in danger every day I get behind the wheel of this car just to go to work.”
Lillian Karamanian, a retired clothing store owner from Troy, got rid of her 2011 Fiesta shortly after taking it for a repair. “I wanted to know if I would notice a difference on the surging, hesitation and lack of power. The response was that it would take at least 500 miles of aggressive driving in order to break in the fix and be able to notice a difference. I did everything I was supposed to do and nothing changed. It never got fixed. I kept thinking ‘this is crazy.
Ford’s lawyers argued against making the documents public early this year, saying, in part, "In fact, the 72 documents that … Plaintiffs propose to file highlight the fundamental deficiency in their Complaint: like the Complaint, these documents merely show that Ford — both before and after Plaintiffs purchased their vehicles — identified and addressed various issues of varying significance with the transmission.
The coming recession would send General Motors and Chrysler to bankruptcy in 2009, with Ford surviving thanks to a $23 billion line of credit secured in late 2006, in Mulally’s early months as CEO. But Ford was hardly out of the woods. Sales of its cash cow, the F-Series pickup, had plummeted as gas prices surged and construction activity froze. Mulally told lenders he would cut costs and boost development of the fuel-efficient cars Americans needed at the time.
Program calibration manager George Herr, who responded with concern to Langeland’s email six months earlier that “we … cannot achieve a driveable calibration,” was quoted in the news release praising the technology, as was Piero Aversa, the program engineering manager, who was copied on Herr’s follow-ups.Responding to lawyers’ concerns as the transmission was being developed, Ford quality supervisor Johann Kirchhoffer wrote in an email on June 27, 2008, that stalling “alone is not hazardous.
“Items are rated Severity 10 because no mechanism exists for customer warning prior to failure,” said the internal report, written 17 months before the release of the 2011 Fiesta. But that’s what happened — and problems became immediately apparent. While problems had been reported with the 2011 Fiesta, they mushroomed with release of the Focus, which was more than 300 pounds heavier than the Fiesta and demanded more of the transmission.
Mulally, who said he would benchmark Ford against Toyota, started a simple red-yellow-green system to boost the company’s quality. He earned media attention for using the system as part of his weekly management meetings to illustrate the status of projects. A green light meant things were on track; a yellow light indicated caution with a plan in place; a red light indicated a critical situation with corrective action needed.
“What is the cost of poor quality?” is the title of a page in the internal report, which notes “significant” action is required to “get to competitive quality levels.” An accompanying chart notes that the 2011 Focus — before use of the DPS6 — had 23 unhappy customers per 1,000 surveyed while the new 2012 Focus had 266 unhappy customers per 1,000 — after just three months of ownership.
The technology is widely used today, often by luxury brands and sports cars such as Porsche. There are two kinds of dual-clutch transmissions: wet-clutch and dry-clutch. The difference is whether oil lubricates the clutches. The DPS6 was a dry-clutch design, which leads to higher temperatures and potential performance problems, engineers say.Ford’s 2012 review showed that things went south from the start.
The change was not made, and Ford for years continued tweaking the DPS6, adjusting calibration, clutch materials and fixing a seal leak. Documents show that parts ran in short supply in late 2016 for the latest fix at that time.At issue, a quality control engineer with years of experience at Ford told the Free Press, was the high cost of substituting a different transmission in low-cost vehicles with a thin profit margin.
“The quality office at Ford is a separate operation from product development. They’re supposed to take issues to the top floor,” the engineer said. “These vehicles never passed the tests. Work is supposed to be complete at FEC — Final Engineering Completion. It wasn’t. The quality operating system failed. Inputs from customers were ignored. Corrective actions weren’t effective.”
“You want to know why you don’t want to do anything about it? It’s work. It comes right back at you — drop everything you’re doing, work around the clock and you’re on the hook to explain what you’re doing and the weight of the company is on your shoulders and it’s incredibly stressful and intense. You face the repercussions of publishing recovery plans and explaining three times a day to upper levels of management.
“Last time I drove , I was going down the interstate between two trucks and it feels like the car goes into neutral on the freeway. You have to pull over to the side. It’s just not dependable,” she said.“While driving 70 mph, the vehicle stalled and lost power,” the driver of a 2015 Focus reported to a NHTSA official. “As a result, another vehicle crashed into the contact’s vehicle” on July 1, 2016, in Ladera Ranch, California.
Hamm, as a transmission testing engineer, emailed a colleague on May 10 to keep the dealership from pulling the transmission, to “hold off on the swap,” until it can be examined. “I wouldn’t be asking if it wasn’t a safety issue.” Denny Robertson, 40, of Greenville, Texas, depends on his 2013 Fiesta to get to medical appointments too. “We’re on a set income. We’ve gone through hell.” His wife, an amputee, apologized for crying during the interview. “We’re trying to get to the point that we can save a little money, but since I had open heart surgery last year we have no savings and sink a little more down each month with medication costs.
The company in 2014 extended the warranty on transmissions in the 2010-14 Fiesta and 2012-14 Focus, and created a six-page “talking points” guide to help dealers work with customers.Sample questions and answers in the guide include:Why don’t you see this as a safety issue? Safety recalls are necessary when a defect poses an unreasonable risk of accidents or injuries.
“This unit will need a new trans,” wrote David Snyder, a Ford supervisor, to the chief engineer for global product development, at 12:15 p.m. April 15, 2013.“So what is the customer to do?” Snyder asks the whole team by email the next day.
For context, complaints relating to these transmissions are nearly 50% higher in a shorter time period than complaints to NHTSA of dizziness and nausea from occupants of the 2010-18 Ford Explorer, which are the subject of a federal investigation. While Ford has maintained that the Focus and Fiesta transmission problem does not pose a safety risk, in June of this year, the company recalled 123,000 2013 F-150 trucks because of a transmission calibration issue. The vehicles had been reprogrammed as part of another recall, but the updates did not fully prevent such problems as an unintended downshift.
The memo refers to an online presentation also obtained by the Free Press whose participants from Ford included a senior research engineer, internal investigations manager, global automotive safety compliance assistant director, the transmission engineering manager and transportation quality supervisor.
The change, which was to be in place five and a half years after the first car with a DPS6 went on sale, would not remedy the transmission problems; it was intended to warn drivers when their car was about to slip into neutral. A subsequent document showed that the warning was included in a service update.
Event 5: Started engine, engine light was still on. Drove on highway, trans was shifting in and out of neutral with no movement of the shift lever. This would occur even at the stop lights. Continued to drive to interstate. In response to “Customer complaints of ‘no starts,’ ‘loss of gears’ and ‘loss of motion,’” the bottom of a page in the report notes: “Engine continues to run, power steering, power brake assist, electrical and restraint systems remain operational.”
Ford devoted a page in the report to “litigation and government investigations,” noting that “consumer litigation is increasing in all regions.”A class-action case based in federal court in Los Angeles covering 1.9 million owners and former owners. In these cases, members of the certified class are treated the same in each state and certain claims are capped according to the terms of the settlement.
Lawyers who have negotiated with Ford say the company has offered settlements of more than $75,000 to individual plaintiffs in California, which is known for its strong consumer protection laws. They note Ford has lost its only trial to date on the matter in California, with a judgment of more than $700,000. The company conceded liability of more than $145,000 in damages, but challenged a fraud claim and lost.
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