Ford cars, which have relatively good conditions in the “three major†automobile companies in the United States, are facing a severe test. Following the Firestone tire recall in 2000, Ford will implement a large-scale car recall. The total number of vehicles that will be recalled this time will reach 4.5 million, setting a record for the highest recall in the history of American automobiles. Analysts pointed out that such a large-scale recall may have a certain impact on Ford's performance in the second quarter of this year, showing signs of improvement. The US Highway Traffic Safety Administration issued the Ford recall report on October 13 local time. The recalled vehicles were windstars from 1995 to 2003. The reasons for the recall were that the cruise control switch could leak brake fluid to the anti-lock braking system, causing the vehicle to catch fire. With this recall, Ford has accumulated more than 16 million vehicles in the past 10 years due to this problem. The U.S. Highway Traffic Safety Administration also said that Ford will also recall 3.4 million quality hazard vehicles, most of which are pickup trucks and SUVs, due to the deactivation of cruise switches. In Ford’s history, the 2000 Firestone tire recalls have caused a major blow to Ford Motor. During the time when Nasser was president of Ford, Ford’s “Explorer†series of SUVs was accused by the customer due to the quality problems of Firestone tires. According to a survey conducted by the US Department of Transportation, at least 150 car accident deaths are related to this. Eventually, Ford Motor Co. had to announce the recall of 13 million Firestone tires, with losses exceeding US$5.5 billion. This incident also led to a substantial decline in the trust of Ford Motor Co., and as a result, it has seen sales decline for six consecutive years, which has widened the gap with General Motors. An overseas auto parts supplier's reference to overseas prices of cruise control switches believes that Ford’s recalled parts cost is expected to exceed US$200 million, but Texas Instruments is expected to share this cost with Ford Motor. In addition, if you add other costs, it is expected that this recall event will bring no small financial expenses. Under the leadership of Ford’s current President Murali, Ford’s performance has just improved this year. In the second quarter of this year, Ford Motor Co., Ltd. led GM and Chrysler to complete a reversal and achieved a net profit of US$2.3 billion. In September, Ford Motor's US sales increased by 0.8% year-on-year, and its market share increased to 15.2%. In the same period, sales of major auto companies such as General Motors, Chrysler, Toyota, and Honda were still falling sharply. It is therefore considered critical that this recall can be handled properly. Some industry analysts believe that, first, a large number of recalls will inevitably bring about a certain financial costs; Second, the recall may bring a crisis of confidence to Ford Motor. Chen Wenkai, president of Gasgoo.com, pointed out that with the increasing sales and supplier systems of automobile companies, the difficulty of managing suppliers has increased. In a letter to the National Highway Traffic Safety Administration, Ford said that the faulty control switch was manufactured by Texas Instruments, which has caused Ford to take more than six recalls involving 14 million registered cars. Texas Instruments is said to no longer provide this control switch to Ford. In February of this year, Mulally announced a substantial reduction in suppliers, plans to reduce 419 in 2008 from the 1,600 suppliers, the ultimate goal is to cut off half of the suppliers. Mulally’s move is seen as a change to the supplier system to achieve better supplier and quality control.
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