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Special Event

Joint Committees Deliver Opening Statements at Congressional Hearing on Firestone Recall

Aired September 6, 2000 - 1:41 p.m. ET

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

LOU WATERS, CNN ANCHOR: We are covering the testimony about to be heard up on Capitol Hill before two House subcommittees. Opening statements are now being heard in the committee room. John Dingell from Michigan has the floor. Let's listen.

(JOINED IN PROGRESS)

REP. JOHN DINGELL (D), MICHIGAN: ... Bridgestone/Firestone announced August 9 as the second largest tire recall ever. It is surpassed only by Firestone's recall of 14.5 million tires in 1978.

The recall in 1978 lead to hearings where this committee disclosed many of the same problems that are involved with the recall today.

Then, like now, tread belt separations on Firestone tires were involved in accidents causing serious injury and death. Then, like now, many of Firestone's problems related to its client in Decatur, Illinois.

The recent recall came about only after Ford Motor Company, whose vehicles were equipped with many of the recall tires, was given access to Firestone's claims data in late July, and was able to link 46 deaths and a large number of claims to accidents involving three 15- inch models of Firestone tires: ATX, ATXII and Wilderness AT.

Since August 9, the number of fatalities attributed to these tires has grown to 88, according to the National Highway Traffic Safety Administration.

Time, then, is of the essence.

I do note that after my letter of August 11, Firestone agreed to speed up its recall by reimbursing consumers who had replaced their tires with those of a competitor.

More is riding on this hearing, however, than the reputations of Firestone and Ford. Countless Americans are on the road today picking up their kids, driving to work, and the last thing that should worry them is the quality and the soundness of their tires. It is unconscionable that so many have been placed in this kind of situation. Today, almost one full month after the recall was announced, neither Firestone nor NHTSA, the government agency responsible for tire safety, has been able to identify why these tires are failing and why serious accidents are occurring.

Consumers, therefore, have justifiably expressed a great deal of concern for their safety and for that of their loved ones, as well as a lot of frustration about the way this story has unfolded.

Every day there seems to be some new disclosure, fostering apprehension that Firestone may not yet have control of the problem. The concern was compounded by a recent full-page ad placed by Firestone in major countries -- in major papers around the country assuring consumers that it acted appropriately but acknowledging it does not know what's causing the tires to fail.

In order to restore public confidence, Firestone must identify the root cause of its failure problem, and quickly and fully disclose their findings.

Consumers can also take little comfort from Firestone's explanation of why it took so long to identify the Firestone failure problem. According to Firestone, the problem eluded them because manufacturers never properly analyzed data and personnel claims to identify defects or problems with tires. They say the university of claims data is simply too small. But a staff examination of the records, revealed since 1995 Firestone had reports on more than 1,600 lawsuits, property claims and personal injury claims involving their recalled tires.

I must say I find it curious that Firestone did not regard 1,600 claims as significant when it took only 21 claims for State Farm Insurance Company to decide that a potential problem existed. Records available to the committee also indicate that some in Firestone, in apparent contradiction of its statements to committee staff and others, analyzed their claims dated 1998. These Firestone analyses show that the claims were especially high for ATX tires, and the claims were highest for tires produced at the Decatur, Illinois, plant.

Contrary to Firestone's other assertions, at least one other American tire company, Goodyear, says it routinely looks at all its customer data, including claims data, to identify defect or failure trends with its tires.

Whatever else we learn at the hearing today, we hope that we will find that all involved will find the need for more open and detail communication regarding these critical products and how they perform in the field.

If it is industry practice not to share claims with automakers, then it is time for that practice to change, by statute or otherwise.

Had the Houston television station not run the story that we've seen today, perhaps we would not be discussing these matters.

As to NHTSA, we need to know that its resources are adequate; that it can effectively perform its important safety work.

If budget cuts and other restrictions placed on that agency prevent it from protecting the public, then this committee should seriously look at increasing the budget and freeing the agency from constraints. It is also entirely appropriate at a time like this to evaluate whether NHTSA's statutory authority is sufficient, and I trust we will hear about this as we go forward.

Again, Mr. Chairman, I thank you and Chairman Upton for holding this hearing, and I look forward to the testimony of the witnesses.

WATERS: John Dingell, whose Michigan district includes Ford headquarters.

Ed Garsten up there in Detroit.

Ed, I understand you talked to Mr. Dingell recently?

ED GARSTEN, CNN DETROIT BUREAU CHIEF: I did, indeed, Lou, last week. In fact, I sat in his townhouse, which is roughly one mile from the world -- Ford world headquarters, and I asked him, I said, you know, how can you be impartial in this when Ford is in your district? He said, my concern is for safety of all motorists, I'm not a defender of Ford. Although you might have noticed, Lou, I don't think that I heard the word Ford or Ford Motor Company...

WATERS: You did not, no, you did not.

GARSTEN: ... in his entire statement. And he has said all along, and he said flatly to us, that he puts the blame squarely on the part of Bridgestone/Firestone and on the NHTSA for the problem here with the tires.

WATERS: And he mentioned NHTSA and their regulatory power and maybe might have to be enhanced by legislative action of some sort. Do you expect that that might be the case?

GARSTEN: Well, that may be the major outcropping of this whole investigation aside, of course, from finding out, perhaps, why this all happened. But they certainly -- the agency certainly either didn't feel that it wanted to act or that it should act, or just didn't do anything, got the data and either didn't analyze it or act on it properly in this. So you may very well find that this becomes an agency with a lot more power.

Now, you also have to remember, Lou, that this is an agency that got its new administrator only a couple of weeks ago, so it's in a period of transition at this point still.

WATERS: And there'll be a lot of answers: I don't know or we didn't have to know and there was no regulation suggesting that a report had to be made about this, that or the other thing?

GARSTEN: Sure. And if no one points it out, if no one tells NHTSA that, hey, we've got a big problem here, we need you to act, lots of times they won't. They've got all sorts of cases and you have to remember, too, that NHTSA is also quite dependent on reports from motorists. This is their lifeblood. They can't act on something if they don't know about it. They may say that this problem is underreported by consumers and it just didn't seem like there was a trend here at all that they needed to act on.

WATERS: All right, Ed Garsten up there in Detroit.

And now in the committee room, the chairman of the subcommittee on oversight investigation, the Republican from Michigan, Fred Upton has the floor.

(JOINED IN PROGRESS)

REP. FRED UPTON (R), MICHIGAN: ... to ask tough questions of the witnesses to further illuminate what can be gleaned from the information with hopes of what we do here today can help save lives tomorrow.

I would like to note that I'm not happy to learn that Secretary Slater apparently has refused to participate in this hearing today despite him being just down the street. As secretary of transportation, it is his responsibility to oversee NHTSA's role in the life and safety for Americans traveling on Americans' highways. This is the people's business, and if he can be with Cokie Roberts on the Sunday talk shows, he certainly ought to be here before Republicans and Democrats searching for the truth on a workday.

I want to thank Chairman Tauzin for his efforts in holding this joint subcommittee today, and Chairman Bliley as well. I look forward to the testimony of our witnesses and the answers to our questions. And I yield back the balance of my time.

REP. BILLY TAUZIN (R-LA), CHAIRMAN, TELECOMMUNICATIONS, TRADE AND CONSUMER PROTECTION SUBCOMMITTEE: Thank very much the gentleman.

And the chair now yields to the designated minority representative of the Oversight and Investigations Committee, the gentleman from Michigan, Mr. Stupak.

REP. BART STUPAK (D), MICHIGAN: Thank you. Mr. Chairman, and thank you for holding this very important hearing. I hope it is the first of several to look into the tire safety issue.

Twenty-two years ago, this committee held four days of hearing on the first incident of tread belt separation in radial tires. The tire was the Firestone 500, a radial developed for passenger vehicles. Although the 500 had a very high rate of failure at the time of the hearings -- there were 15 deaths and 16 injuries, ultimately 41 deaths resulted -- in contrast, there are already 88 fatalities attributed to the tread belt separation in the Firestone ATX series of tires we are looking at today, and the number continues to grow.

The reason: This tire's placed on a sport utility vehicle, a vehicle which has a tendency to roll over when a tire fails. The tire failure is one of the top three most serious vehicle safety defects we've ever seen in this country. It is surpassed only by the deaths and injuries that resulted from the Ford Pinto rear-mounted gas tank and a GMC pickup externally mounted gas tank.

Unfortunately, many things have not changed since 1978. Firestone, then as now, has found no manufacturing or design defect, but blames the consumer for every single failure.

Firestone alleges that consumers drive too fast, under-inflate their tires, drive in hot climates, overload the vehicle, and don't do proper maintenance

Then, as now, Firestone Decatur plant showed up as a source of an unusual amount of failing tires. Then, as now, Firestone cannot explain why other brands of tires don't have the same failure rate. Then, as now, the National Highway Transportation Safety Administration, NHTSA, standards for tire strength were and are grossly inadequate. In fact, they have not changed those standards since 1968, long before there were steel-belted radials and the popular sport utility vehicles.

There are a few new wrinkles. This time, the tires are found mainly on one company's vehicle: the Ford Explorer SUV and light trucks. And Firestone has two new factors to blame: hot climates, which stress its tires, and high ozone, which degrades its tires.

The other change is that Ford, until recently, had agreed that -- with Firestone, that there was nothing wrong with the tires. Ford made these statements despite receiving more and more complaints from their dealers who were wondering why only Firestone tires failed.

Mr. Chairman, we're going to hear a lot today about Firestone didn't know there was a problem, Ford didn't know there was a problem, NHTSA didn't know there was a problem until a Houston television station told them there was.

The documents the committee has received, along with the news reports, indicate that all these parties knew a great deal more in 1998 and 1999 about tire failures than the Houston television station did. They just ignored it.

We also are going to hear from a number of witnesses that the number of failures was so small that no one could have been expected to pay attention. Yes, the numbers begin small, but because the propensity of the SUVs to rollover when a tire fails, the cost in deaths and injuries was inordinately high and increasingly at an alarming rate.

Both Ford and Firestone should have known and should have watched this particular vehicle more closely. With less than 6,000 vehicles in the entire country of Saudi Arabia, there were 18 accidents in Saudi Arabia, including seven fatalities in 1999. The U.S. had four. And there was another large group in Venezuela. Despite what anyone says about the conditions in all these countries, one fact remains: Other tires under same conditions did not fail.

That should have alert everyone. It alerted the State Farm Insurance Company, it alerted the Center for Auto Safety. Unfortunately Ford, Firestone and NHTSA failed to act. Mr. Chairman, if we cannot depend on Ford and Firestone to tell us what happened, the American consumers are tired of hearing Firestone blame its customers for the problems found in their tires. American consumers are tired of hearing Ford blame Firestone. Consumers don't want to go out and buy four tires and ask the dealer to throw in a vehicle; they buy a vehicle and the tires are part of that vehicle.

Today I'm going to ask Firestone and Ford to join with me in calling for and cooperating with an independent review of these tire failures worldwide to determine the cause of the failure and to propose solutions and report back to this committee and the public by the end of the year.

In the meantime, I believe the recall should be widened to include all 15- and 16-inch Firestone tires, as has been done in Venezuela and Saudi Arabia.

We here in the United States deserve to be treated no differently than people in other parts of the world. We deserve an answer to the many questions that will be raised here today. I'm afraid that Firestone, Ford and NHTSA can't find the answers.

Let's join together to call for and support a fully independent review of this situation so that we can find the answers. The public deserves an answer, this committee deserves an answer, and most of all, the families of the 88 people who've lost their lives deserve an answer.

With that, Mr. Chairman, I yield back the balance of my time.

TAUZIN: I thank the gentleman.

The chair is pleased now to welcome the vice chairman of the Telecommunications, Trade and Consumer Protection Subcommittee, the gentleman from Ohio, Mr. Oxley, for an opening statement.

REP. MICHAEL G. OXLEY (R), OHIO: Thank you, Mr. Chairman.

We are here for a hearing on the most serious of issues: highway safety. Every day, drivers rely on their vehicles and tires to carry them to destinations a mile or hundreds of miles away. They want to get where they're going and back safely. And the encouraging fact is that fatality rates have fallen in relation to vehicle miles traveled.

Today we confront something out of the ordinary: a proportionally high number of accidents, some of them tragically fatal, principally involving Ford Explorers and Firestone tires. So the job of the two subcommittees here today to make sure that drivers and their families feel secure. My hope is that the Commerce Committee will be able to look at the Firestone recall situation in the detail it deserves. What caused these accidents? Was there a trend that could have been identified much earlier? What needs to be done in response?

There will be questions about engineering, product quality and data review today. A full review of highway safety should eventually take driving behavior into account as well.

The challenge for these subcommittees is to dig beneath the headlines of the last month and the events of the past few years because if the answer is too easy, the question probably wasn't good enough.

I extend a welcome to our witnesses, and I particularly note the presence of Ford President Jacques Nasser, and the CEO of Bridgestone/Firestone, Mr. Ono.

You can't write the history of the automotive industry without the names of Ford and Firestone and the advances from the Model T to the cars of the new millennium that they have been part of.

The first thing that I'm looking for is assurances that every driver is being protected. Suspect tires must be replaced now. Tire manufacturers are boosting production to help fill the current shortfall, and the exchange terms for consumers should be hassle-free.

The replacement program must also be fair nationwide. Vehicle owners in states with relatively low accident rates, like Ohio, have the same right to new tires as people who live in states where there have been more incidents.

Experts are already at work trying to determine what caused the problem and whether it is a single cause or many.

"Why?" is one question. "When?" is another. Why weren't any trends detected earlier? I find it remarkable that NHTSA did not follow up on findings made by a researcher for the nation's largest auto insurer, State Farm, all the way back in 1998.

Recalls of this magnitude inevitably prompt a review of regulations and practices. I suspect that there will be heightened cooperation within the automotive and tire industries from now on.

The regulatory question to ask is whether agency resources have been put in the right place, and whether regulators are focusing their attention on the most important issues.

We should also resolve to do the most good for the consumer, by putting agendas aside and responding on the basis of the facts as they emerge.

I was disturbed to find a web site called, quote, "The Firestone Tire Recall Legal Information Center," end quote. This seemed to be more devoted to finding cases for trial lawyers than for providing assistance to consumers.

There will be some hard questioning today, and properly so. The Commerce Committee has a long tradition of oversight in the public interest. We must put safety first.

I look forward to our witnesses and the questioning that will follow. And I yield back. WATERS: Congressional hearing getting under way up on Capitol Hill with opening statements by members of two subcommittees. We're expecting to hear from witnesses who you've seen shots of along the way here. They include Sue Bailey, who is the administrator of NHTSA, the new administrator of NHTSA, the Bridgestone/Firestone CEO, Masatoshi Ono and the Ford CEO, Jacques Nasser. We'll also be hearing from a spokesman for State Farm and the Center for Auto Safety this afternoon.

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