Ford, Firestone Reach $240M Deal

Bridgestone Firestone North American Tire LLC will pay Ford Motor Co. $240 million to cover its obligation in connection with a pair of recalls that cost the auto maker more than $2 billion and tarnished the reputations of both companies.

The joint settlement covers Ford's voluntary recall of 6.5 million tires in August 2000, and its “Firestone tire replacement program,” which culled 13 million tires in May 2001.

The recalls shone a harsh spotlight on the safety record of Ford's popular Explorer SUV, which was linked to 271 rollover deaths in which tire tread separations were a key factor. Despite protests from Bridgestone Firestone, a subsidiary of Bridgestone Americas Holding Inc., National Highway Traffic Safety Admin. investigators found that tire defects were at the root of the crashes.

The conflict led Ford to blacklist Firestone from its North American supplier list. The tire maker, however, suggests the settlement could renew a business relationship that goes back nearly a century and links two prominent American families.

William Clay Ford, grandson of Henry Ford, married Martha Parke Firestone, granddaughter of Harvey Firestone. Their son is Bill Ford, the auto maker's CEO and president.

Bridgestone Corp. bought Firestone in 1988 for $2.6 billion.

Ford welcomes the settlement, but a spokesman says there are “no plans” to put Firestone tires on its products that are sold in the U.S. (Bridgestone has continued to supply Ford operations in Asia, Europe and South America.)