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Breaking News

Ford Motor Company Holds News Conference on Firestone Tire Recall

Aired August 24, 2000 - 3:09 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

WOLF BLITZER, CNN ANCHOR: Bobbie, Ford Motor Company at this hour is holding a news conference to discuss the recall of 6 1/2 million Firestone tires, many of those millions of tires have come on several Ford model trucks.

Let's listen into what Ford officials are now saying in Dearborn, Michigan.

(JOINED IN PROGRESS)

UNIDENTIFIED MALE: ... statistical analysis, Ernie Grusch (ph), who's manager of safety statistical analysis here at Ford Motor Company. A bit of update on where we are in the tire recall. This is from Firestone and Ford data from out in the field, and I think we have a chart which we will show you. As we speak, we are at 13.3 percent of the target completed, that equals 861,874 tires replaced as of about an hour ago. We have 86.7 percent of the target remaining.

We have -- this is a very fast pace. Anybody that follows recalls will show this is a very, very fast pace. In fact, it seems to be moving about a half of percent every few hours. But we still have a shortage of tires out there, and we're taking actions to address that.

So I'd like to bring up Helen Petrauskas, and she'll turn it over then to Tom Baughman, and when Tom is done, we'll take your questions. So let's get going.

HELEN PETRAUSKAS, V.P., FORD ENVIRONMENT AND SAFETY ENGINEERING: Thank you.

Before I review for you some of the actions that we've taken with respect to this issue of Firestone tires, let me emphasize a couple of things, and that is the principles that have driven all of these actions we're taking. I think first and foremost for us to ensure the safety of our customers. That is absolutely number one in our book. And to make sure that we can retain and earn the trust that they've given us by buying a vehicle from us. I guess the second principal that has driven us is speed. We are doing everything we can to get good tires on customers vehicles as quickly as we can, and I can't tell you and I can't exaggerate enough the effort that we're putting into that. I mean, it's seven days a week, 24 hours a day, everybody nonstop. And then finally, in all this, we have we've tried to be as open and as transparent as we possibly can. We've tried to answer all of your questions, but we have tried as best we can to respond to all of our stakeholders and constituents.

With that, if I could have the next slide, please.

In terms of actions we've taken, we replaced tires in the Middle East. We did that in July of 1999, in Southeast Asia of February of this year, and then in Venezuela and the adjacent countries in May of this year.

What is less well known is at the very same time we took these actions, we also acted to determine if there was any indication of the same issue manifesting itself in North America. And we did several things. First, we asked Firestone to check their U.S. database and do some tire testing, which they did. We reviewed the NTSA hotline, as well as internal database. These are the ones that we and the government use to determine if there is a reason to launch a further evaluation. And finally, with Firestone, together with Firestone, we undertook a study of, we call it the Southwest Study of worn tires in that part of the country to see if we could see any evidence at all that the problems we had seen in Saudi Arabia and some of the other countries were also manifesting themselves in the U.S.

At the end of all of those actions, we found no evidence of tread separation in the United States that was analogous to what we were seeing outside the United States.

If I could have the next slide.

We then requested and analyzed additional data from Firestone, and of course we supported the Firestone recall decision.

Could I have the next slide?

In terms of trying to get replacement tires for our customers as quickly as we can, working with the tire industry, they're increasing production of 15-inch tires by more than 250,000 tires a month by the end of September. We've engaged 3,100 Ford and Lincoln-Mercury dealers to perform tire replacements.

As most of you know, we suspended Explorer and Ranger production at three of our assembly plants, Edison, St. Louis and Twin Cities, in order to free up to be used for the recall.

And then, finally, we're continuing to look for other mechanisms to get more tires out there, more good tires out there, as quickly as we can for our customers. One of the things we're looking at is to see if we can change the mix of 16 and 15-inch tires to free up the 15-inch ones.

We've made major efforts to communicate with our customers and to try to deal with the very understandable concerns they have over safety. We've opened up an additional call center. We have our Web site and we have been doing a series of newspaper ads to bring our customers and the public up to speed in terms of what's happening.

And finally, we've cooperated fully and made full disclosures to NTSA. And let me just talk about that a little bit. The other day I was over with our people who work on the NTSA response, and there must be 23 boxes of information, and documents and CDs that we're turning over to the government. Many of these relate to what is the day-to- day ebb and flow of the work of engineers. So what you see is e-mail messages, you see individual test results, you see drafts of reports, you see engineers arguing with one another, and you see engineers worrying about making this vehicle that they are working on, in this case the Explorer, as good as they possibly can.

And I was really struck that somehow that was held against us that we are worrying, that our engineers are worrying about the performance of the vehicle. That's what engineers are paid to do. They're paid to worry, they're paid to work hard. But the final proof of the vehicle is not anyone test, and it isn't anyone piece of paper. It really is the overall performance of the vehicle on some very, very tough tests that we impose on ourselves. And then the final measure of the performance and safety of the vehicle is the way it performs in the hands of customers, and we're going to talk about that a little bit.

With that, let me introduce Tom Baughman.

TOM BAUGHMAN, FMR. FORD TRUCK ENGINEERING: Good afternoon, everyone, I'm Tom Baughman. I'm the engineering director for North America Truck. And before I go through the analysis of the detailed claim information we have, I'd like to explain to you a little bit of what data we received from Firestone and the analysis process. The data that we received from Firestone involved a group of claims, I'll use that word, claims, that involved property damage claims, personal injury damage claims and also some lawsuits. So we aggregated that data together, and over the course of about five days did an in-depth analysis, cutting through the data several different ways to make sure that we absolutely understood the problem, isolated the suspect tires, and also proved satisfactory the tires did not need to be included in the recall.

So I will take you through that data. It's a little bit exhaustive. I'm sorry for that. But please stay with me. And when we get to the question-and-answer period, if we need to go back to any of the slides, I'll more than happy to do so.

Could I have the first slide, please?

This is analysis of the claims that were in Firestone's database, analyzed by tire size. And as you can very clearly see, over on the left-hand side there were over 2,000 claims associated with P235/75r15 tire. This is a document called the Parado (ph) Chart, which parados from largest to smallest the occurrence rates. later, you'll see that we actually adjust this based on the number of tires produced to actually get to a parts-per-million kind of defect rate. But this is just the first pass through the data, showed a clear tendency that one tire size really jumps out at you as being the suspect tire.

Can I have the next slide, please?

If you dive into the data a little deeper and take a look at the reported causal factor for why that damage claim occurred, something very alarming jumps out at you, and that is the tread separations, on particularly the ATX tires, represent the vast majority, in fact, almost 75 percent of the claims against the 15-inch tire. What you see there is the red bars are the ATX tires and the blue tires are the wilderness tires, and tread separations, which are very rare in the industry as a general tire issue, jump out as being very, very unusual. Normally -- and I've looked at tire data over many, many years. What usually shows up is other road hazard damage, such as nail punctures and sidewall blowouts. That's what is shown when you do an analysis of tire data. What was very unusual when we spotted this was the thread separations, particularly on ATX, was such a disproportionate number of the claims in the Firestone database.

BLITZER: Tom Baughman, he's the engineering director for trucks for North America for the Ford Motor Company updating us on what is going on with the six-and-a-half million tires that have been recalled, the Firestone tires, for Ford trucks. So far, we were told by Ford Motor officials about 13.5 percent of the six-and-a-half million tires have now been replaced. But some 86 percent still have to be replaced -- Ford Motor Company insisting this a very fast pace. Obviously, they are insisting also that safety is priority number one.

They're telling us that the main problem involves what has been called the tread separation, but they are still not determining -- at least right now -- why that tread separation is developing in these tires, for these ATX tires, on Ford Explorers, Ford Rangers, these Ford trucks. They're still working on that together with Firestone and the National Highway Traffic Safety Administration in Washington.

We are going to continue to follow this story, obviously. But for now, we are going to take a break. TALKBACK LIVE will be right back.

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