Ford Set To Record $295 Q1 Hit From Two Recalls
FORD CFO, Bob Shanks, last week alluded to a higher-than-expected warranty cost that will impact Ford’s first quarter earnings.In a filing with the Securities and Exchange Commission, Ford said the $295 million charge would be absorbed mainly by its North America and Europe business units and would be included in first-quarter results.
Ford is calling back 230,000 2014 model year Escapes, 2014-15 Fiesta STs, 2013-14 Fusions and 2013-15 Transit Connects equipped with 1.6-liter GTDI engines. Ford said a lack of coolant circulation can cause the engines to overheat, cracking the cylinder head. That could result in an oil leak that could ignite a fire.
Ford said it’s aware of 29 reports of fires in the U.S. and Canada; no injuries have been reported.The company currently doesn’t have service kits available and told customers to continue to drive their vehicles. The company advised customers to seek a dealer if their vehicle leaks coolant. It will mail customers instructions on how to check and refill coolant.