Nov. 29 (Bloomberg) -- Ford Motor Co. will give almost 1 million Explorer sport-utility vehicle customers $500 toward a new model or $300 toward other Ford vehicles to settle lawsuits claiming the SUVs lost resale value after a 2000 tire recall.

Customers in California, Illinois, Texas and Connecticut who bought or leased Explorers from 1990 to 2000 will be eligible to claim certificates toward the lease or purchase of new vehicles, said Kevin Roddy, an attorney for California customers who sued. Ford, the second-biggest U.S. automaker, confirmed the accord.

The accord, subject to court approval, could cost Ford as much as $500 million if all eligible customers received $500, Roddy said. The settlement resolves false-advertising lawsuits seeking reimbursements for customers claiming Explorers were worth less after the vehicles' tires were recalled. Ford hid defects and said the SUVs were safe, the lawsuits claimed. Ford denied the claims.

``We believe the agreement is fair and reasonable and in the best interest of our customers,'' Kristin Kinley, a Ford spokeswoman, said yesterday in a phone interview.

The $300 certificates are also good toward the purchase or lease of Lincoln Mercury vehicles, Roddy said.

Consumer claim rates for settlement certificates that offer discounts on the same products that were the subject of a lawsuit can be as low as 5 percent to 25 percent, said Brad Seligman, a Berkeley, California, attorney who represents plaintiffs in class-action lawsuits.

`Increasingly Skeptical'

``Courts are increasingly skeptical of these types of settlements,'' he said in a phone interview. A preliminary settlement hearing is scheduled for Dec. 3 in state court in Sacramento, California.

The certificates will be transferable, making them more attractive to eligible customers, Roddy said. The plaintiffs' attorneys will be paid $25 million in fees for work on the economic-damages suits, he said.

Safety concerns about the Explorer after the August 2000 tire recall by Bridgestone Corp.'s Firestone unit eroded the vehicles' resale value by at least $1,850 each, customers claimed in the California lawsuit.

Ford, based in Dearborn, Michigan, denied the economic-loss claims, saying the sport-utility vehicles were safe and experienced normal depreciation over time.

U.S. Explorer sales were 179,229 last year, a 25 percent decline from 239,788 in 2005. Ford sold 445,157 Explorers in 2000.

In addition to the suits being settled, Ford still faces hundreds of lawsuits across the U.S. over personal injuries involving Explorer rollovers.

The case is Bridgestone/Firestone Tire Cases, I JCCP 4266 & 4270, Sacramento County Superior Court, (Sacramento, California).

To contact the reporters on this story: Karen Gullo in San Francisco at kgullo@bloomberg.net; Margaret Cronin Fisk in Southfield, Michigan, at mcfisk@bloomberg.net.

Last Updated: November 29, 2007 00:06 EST