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Special Event

Ford Motor Company Talks About Tire Controversy

Aired August 29, 2000 - 4:46 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

JAN HOPKINS, CNN ANCHOR: We're going to Detroit now to hear from officials of Ford Motor about the continuing questions on this Firestone tire recall.

(JOINED IN PROGRESS)

JASON VINES, FORD MOTOR COMPANY: ... continue to supply information and importantly, tires, in the commission's quest for answers. We don't know all the facts, but we know some things right now. Ford started replacing at its own expense Firestone tires on about 39,000 vehicles this past May. Replaced this tires with Goodyear tires. The replacement effort is about 70 percent complete now in Venezuela.

As we got the Firestone tires back from our replacement efforts, we started studying them, cutting them up, and we found overwhelming evidence, at the beginning, of tire separation and importantly, a defect trend in the tires, at least 500 times worse than the very worse tires in Firestone's U.S. recall that was announced earlier this month.

Finally, we are confident this is a manufacturing defect in Venezuela with the tires, as more than half of the tires we have analyzed show they were not built to Firestone's own engineering drawings.

I'll give you one more update. While the official numbers on tires recalled in this recall effort, which is being run by Firestone -- being handled at Firestone tire dealers at independent dealers and at Ford, Lincoln and Mercury dealers, officially is about 1.3 because of the lag in reporting claims.

We think we're closer to about two million tires replaced, to date, of the 6.5 million in the recall. We don't know, however, how many good tires have been replaced. We're only recording tires that are in the recall. So, I'll take questions from anybody on any subject.

QUESTION: Jason, when did Ford know that there was a mislabeling problem in Venezuela between the 5-ply and the 4-ply? How far back did you know that?

VINES: We knew that starting about a week ago. About three weeks ago, we started getting the tires back in the recall -- not the recall -- in our service campaign to replace. And we started analyzing those and cutting those. What we found, again, is of over 50 percent of those tires did not meet the specifications that the Firestone drawings said they should.

QUESTION: Well, how far back did Firestone know that they mislabeled the tires?

VINES: I think they're finding this as new news to them as well, but you'll have to ask them. I mean, we brought this to their attention.

QUESTION: They only just found it out now?

VINES: Well, when we started getting these tires and started coming out -- cutting them up and seeing this issue, we shared that information with INDECU, the government consumer group down there, and of course, we shared it with Firestone as well.

QUESTION: Then why did you go to the Goodyear tires in Venezuela?

VINES: To be quite honest, Firestone tires had lost good grace in Venezuela and we decided to go with Goodyear.

QUESTION: Is it fair to say they've lost good grace in the United States now too, in that you might use Goodyear's original equipment now instead of Firestone?

VINES: We use Goodyear now; we used Michelin; we used Continental; and we used Firestone. The vast majority of the tires being replaced onto the Firestone vehicles are Firestone's again.

What we've done is, to kind of scour the world, to get everybody else to increase production, so we're giving people an option. However, Firestone tires are going on. And by the way, Firestone, for the vast majority of the tires on our products, on General Motors products, on Honda, on Toyota, are world-class tires, just simply world-class.

QUESTION: So no plans, at this point, to drop them as an original equipment supplier?

VINES: No plans.

We have a question on the phone. Can you identify yourself?

QUESTION: Yes, Jason, this is Justin Hyde (ph) with the AP.

VINES: Hi, Justin.

QUESTION: What is the estimate of the cost of the Venezuela recall right now?

VINES: We haven't really put those numbers out. To be honest, I know this may sound trite to you, but we're not worrying about money right now. We're making sure that our customers don't have to pay a penny.

QUESTION: So the figure of $15 million that we've seen from the report is not correct?

VINES: Fifteen million? I haven't heard any number like that. As you can see, there've been reports substantially higher than that, and those are probably closer to it, but again...

QUESTION: Now, I understand that, in Venezuela, when the problems were first reported in '98, you asked Firestone to analyze the reports and they came back with a report of their own.

VINES: They came back -- from what I've seen in documentation -- they came back saying that there's no evidence of any type of tire defect, that it is improper maintenance, improper usage. And they did studies, both in Firestone Venezuela and in Akron. And, I believe, three times they came back and said we can't find any evidence of it.

QUESTION: So, at what point did Ford become dissatisfied with Firestone's action there and decide to move on its own?

VINES: I think it's clear that in May of this year, we believed, for our customers' satisfaction, we had to move. And I'm quite glad we did because by getting those tires back, we're starting to see some evidence of root cause in the Venezuelan market.

HOPKINS: Jason Vines, spokesman for Ford, talking particularly about recall in Venezuela, where the company has found that more than half of the tires were not built to Firestone's specification, although Vines says that he thinks that's a problem within Venezuela.

Also, he answered CNN Ed Garsten's question that Ford has no plans to drop Firestone as the main supplier of tires for original equipment for Ford.

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