Firestone’s Tire Recall
...14, 2000: Bridgestone Corp. president Yoichiro Kaizaki says fatal crashes involving vehicles fitted with Firestone tires caused by various factors, not just problems with the tires. Dec. 19, 2000: Bridgestone/Firestone report blames questioned tread separations on a design flaw and the rubber-making process at an Illinois plant. It also faults lower inflation pressure and higher vehicle load limits recommended by Ford. Jan. 2, 2001: Ford says it will offer tire warranties on all of its Ford, Lincoln and Mercury models as a way to alert itself to problems with any tires. Ford says the warranties would begin with 2001 models. Feb. 6, 2001: NHTSA announces that 174 deaths and more than 700 injuries have been reported to the agency. March 23, 2001: In its annual report, Ford says lawsuits over the Firestone tire recall and Explorer rollovers sought damages of at least $590 million as of the end of 2000. That figure only reflects damage amounts certain plaintiffs chose to include in their lawsuits, and does not take into account settlements Ford has reached in the recall's wake. May 18, 2001: Ford says it has not decided whether to demand a broader recall of Firestone tires, despite a New York Times report it is leaning toward such a demand. May 21, 2001: Bridgestone/Firestone ends a 95-year-long relationship with Ford, saying "the basic foundation of our relationship has been seriously eroded.'' May 22, 2001: Ford recalls remaining 13 million Wildnerness AT tires on its vehicles, saying it is concerned about the tires' safety. The recall will force Ford to take a charge of $2.1 billion. (Associated Press (5/23/01) The financial implications are phenomenal. The recall not only hit Firestone in the pocket but their survival has a company. The negative publicity created a difficult task of maintaining an image of quality. Their stock fell almost 50 percent after the recall. Also any civil lawsuits and increased regulations would be forthcoming. (Business Ethic: p278) So far, Ford has suffered less. Their stock and image didn’t leave untarnished. On the other side of the coin, other tire manufacturers and distributors profited from the six million plus tires that were recalled. The legal issues involved are, Firestone and Ford liable for negligence for waiting so long to inform their customers of a potential danger. There is also the cover up by Firestone of knowing of potential problems as far back as 1994. (Business Ethic: p276) The company admitted to increasing production during this time period in an attempt to dilute the failure rate. (Business Ethic: p276) In the mean time multi-million dollar lawsuits have continued to grow. Not only with Firestone but also with distributors such as Sears, that repaired a tire on recall and now is in a civil lawsuit. (Reuters 7/5/02) Also, there was the government, NHTSA, slow in responding to the information given. That battle is still being fought. Although Firestone admitted to making a faulty tire, others believes Firestone is not at fault and there is no smoking gun or data to implicate so. There are some people that believe, such as Dan Ackman a writer for Forbes magazine, nearly every aspect of the events that led to the great tire recall is ambiguous and based on data that is reported and analyzed in a haphazard fashion. The national system for reporting traffic accidents is "poor," which makes all statistics ambiguous, says Gerald Donaldson, senior research director of the Advocates for Highway and Automobile Safety, a lobbying group for insurance companies and for police and safety organizations. (Ackman, Dan, 9/7/2002) Donaldson says there are 52 police reporting districts in the U.S., each of which has its own system for relaying data to a federal government database. (Ackman, Dan, 9/7/2002) The time span it took for all entities involved to make a decision to inform their customers of the potential problem and trying to dilute the data to make it look like there was no problem is a big ethical question. Although there was a lot of finger pointing, Firestone did step up finally and admitted to making a bad tire. The Bridgestone/Firestone action was voluntary and was not ordered by NHTSA. (Ackman, Dan, 9/7/2002) All that NHTSA had done was to issue an "advisory" on the tires that Firestone has not recalled. "No one is jumping to any conclusions based on 88 deaths," says Rae Tyson, an agency spokesman. (Ackman, Dan, 9/7/2002) NHTSA was also very slow in any proactive measures. Ford maintains that tests completed with Firestone tires on the Ford Explorer indicated no problems. (Ackman, Dan, 9/7/2002) Fords proactive measures included a twenty-four hour hot line, created a tem to speed up the recall procedure, and contacted other tire manufacturers to increase production. (Business Ethic: p276) Would all these financial, legal, and ethical issues have been to this proportion if the appropriate ethical decisions were acted upon sooner. The recall wouldn’t have been has big. Deaths attributed to the Ford/Firestone combination wouldn’t have been as large and the consumer confidence in the companies wouldn’t have eroded. The decision to drag their feet and hoping the problem would go away didn’t help anyone because the problem didn’t go away. In these days and times with communications the way they are, it is very difficult to keep something of this magnitude quite forever. What can be done in the future to prevent something like t...