Ford to spend $610 million to recall 3 million vehicles
A visitor walks past a Ford Escape Titanium at a car show last April.
Greg Baker | AFP | Getty Images
DETROIT – Ford Motor will recall 3 million older vehicles due to possible problems with their airbag inflators, costing the automaker an estimated $ 610 million.
The company confirmed the cost in a petition filed with the Securities and Exchange Commission Thursday after the closing bell. Ford stock fell into the red during after-business trading, down about 2%. The stock rose 6.2% on Thursday to $ 11.53 per share – its highest closing price since June 2018. Ford’s market capitalization is more than $ 45 billion.
In the filing, Ford said the expense will be treated as a special item as part of its earnings for the fourth quarter on February 4th. This means he has no impact on Ford’s adjusted earnings before interest and taxes or adjusted earnings per share – closely watched items from Wall Street.
The National Highway Traffic Safety Administration turned down a 2017 petition from Ford on Tuesday to avoid recalling the vehicles carrying the potentially dangerous airbags made by auto supplier Takata.
The affected vehicles range from model years 2006 to 2012. These include Ford Ranger (2007-2011), Fusion (2006-2012), Edge (2007-2010), Lincoln MKZ / Zephyr (2006-2012), MKX (2007-2010 )) and Mercury Milan (2006-2011) vehicles.
The recall will affect approximately 2.7 million vehicles in the U.S. and approximately 300,000 in Canada and other locations, the company said.
Takata airbag inflators have been a constant issue for automakers for years. The failure can cause airbag inflators to burst and potentially deadly metal objects to fly inside the vehicle. The problem has been linked to the deaths of at least 27 people worldwide and 18 in the US, according to Reuters. The more than 67 million inflators problem is the largest automobile recall in US history