News: Analysis & Commentary: Safety
Fighting to Stay on the Road
Firestone's woes have dragged in Ford, too
Marc R. Sulkes decided he'd rather be safe than sorry. The Firestone Wilderness AT tires on the Wilkes-Barre (Pa.) photographer's new Ford Explorer had just 1,000 miles on them when Bridgestone Corp. announced its massive recall of 6.5 million similar tires. And even though his 16-inch tires weren't included in that recall, he decided to buy a new set of Goodyears. Sulkes explains: "I don't have any confidence in what Firestone is telling us."
He's not alone. Tire-safety fears have soared since Bridgestone's Aug. 9 recall of supposedly defective Firestone tires used mainly on vehicles sold by Ford Motor Co., particularly the carmaker's best-selling Ford Explorer sport utility.STEEP TOLL. Signs are emerging that consumers, like Sulkes, are shunning even those Firestone tires not included in the recall. "Nobody in their right mind would buy a [Ford Explorer] with Firestones on it," says Bob Rolls, a Silver Spring (Md.) U.S. Navy veteran who is spearheading a group of angry Firestone tire owners.
The toll on the world's No. 3 tiremaker has already been steep. The Japanese company says it will take a $350 million charge against earnings for recall expenses. But analysts aren't sure even that will be enough.
Bridgestone faces a still more serious threat to long-term sales. Even early into the recall, a nationwide survey of 500 consumers by online pollsters QuickTake.com on Aug. 11 found that 16% of consumers who have owned tires from Bridgestone or Firestone say they will never buy them again, while 14% who have never owned Firestones say they won't buy the brand in the future.
It's likely consumers will only get more worried. On Aug. 21, the Center for Auto Safety filed suit in Washington demanding that Firestone widen its recall to include at least 12 million more Firestone tires. Bridgestone and Ford have countered that the facts don't support those claims.
Worried about consumer backlash, carmakers are monitoring the situation closely. Analysts predict some of them may even drop contracts with Firestone if there is more bad news. That leaves a potential void for rivals to fill. Says Deutsche Banc Alex. Brown analyst Rod Lache: "It could become a huge windfall for companies like Goodyear, Michelin, Cooper, and Pirelli."
Meanwhile, Ford is scrambling to maintain its own credibility. The company is paying to have its dealers replace recalled tires, some of which Firestone will reimburse. It's also shutting three truck plants for two weeks to free up replacement tires. More notably, Ford says Explorer sales are running 3% below its forecast for August. Its big hope: that it can avoid ending up in the ditch with Firestone.By Kathleen Kerwin and Joann Muller in Detroit and Nicole St. Pierre in Washington