Ford Motor Co.
) announced that it would recall 33,021 units of C-Max hybrid
multi-purpose vehicles (MPV) in the U.S. due to a roof component
that do not meet safety requirements. The issue has been noticed
by both the National Highway Traffic Safety Administration and
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The recalled C-Max hybrid cars were manufactured between Jan 19,
2012 and Jun 26, 2013 in Michigan. Their roof components do not
provide enough protection against head injuries. Only vehicles
without the optional panoramic glass roof will be recalled by the
Ford Motor is planning to install plastic energy-absorbing
material under the roof on both sides of the vehicle to correct
the problem. The automaker has not yet received any reports of
accidents or injuries related to the problem.
Earlier this month, Ford Motor also announced recall of 972 units
of diesel variant of EcoSport mini sports utility vehicles (SUVs)
in India due to a glitch with their the glow plug module, which
helps in starting engines.
Ford started shipping locally manufactured EcoSport in India in
June this year with a starting price of 559,000 rupees ($9,400)
in order to tap the growing market for mini-SUV in the country.
Automotive safety recalls were brought into focus by media after
) announcement of the largest-ever global recall of 3.8 million
vehicles in September 2009, triggered by a high-speed crash that
killed 4 members of a family. Later on, a string of recalls has
led Toyota to face numerous personal injury and wrongful death
lawsuits in federal courts.
A few months ago, the Transportation Department of U.S. slapped a
fine of $17.35 million on Toyota Motor due to late response
regarding a defect in its vehicles to safety regulators as well
as late recall of those vehicles.
According to the department, it was the maximum allowable fine
under the law for not initiating a recall in a timely manner. The
fine added to $48.4 million imposed by the U.S. government on the
company in 2010 due to late recall of millions of defective
In April, Toyota along with other Japanese automakers,
Honda Motor Co.
Nissan Motor Co.
) and Mazda Motor Corp. recalled 3.4 million vehicles globally
for an identical problem. All these automakers have recalled
vehicles for fixing defective airbag system in their vehicles,
supplied by Japanese auto parts maker Takata Corp.
Ford, a Zacks Rank #2 (Buy) stock, posted an impressive 50% rise
in earnings per share to 45 cents in the second quarter of 2013
from 30 cents in the same quarter of 2012 (all excluding special
items). With this, the company has beaten the Zacks Consensus
Estimate of 37 cents.
Revenues in the quarter grew 14.4% to $38.1 billion, exceeding
the Zacks Consensus Estimate of $35.4 billion. The improvement
was attributable to increased wholesale volumes in automotive
business and higher market share in all its regions.