Tag: Strategy

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Workers build a truck as it goes through the assembly line at the Ford Kentucky Truck Plant in Louisville, Kentucky.

Ford Motor said on Thursday it has hired outside experts to investigate its vehicle fuel economy and testing procedures after employees raised concerns, and did not know whether it would have to correct data provided to regulators or consumers.

The issues involving Ford's testing processes do not involve the use of so-called defeat devices — hardware and software designed deliberately to deceive government emissions tests, Kimberly Pittel, Ford's group vice president for sustainability, environment and safety engineering, told Reuters.

The automaker since last fall has been investigating concerns raised by employees that incorrect calculations were used to translate test results into the mileage and emissions data submitted to regulators, Pittel said.

Ford said it was evaluating changes to the process it uses to develop fuel economy and emissions figures, “including engineering, technical and governance components.”

Ford shares dipped slightly in after-hours trading following the disclosure.

Ford has hired the law firm Sidley Austin to lead an independent investigation into possible discrepancies in calculations used to produce emissions and fuel economy figures, Pittel said. The company is using an independent laboratory to conduct testing.

U.S. and California regulators have been cracking down on automakers for emissions cheating following revelations in 2015 that German automaker Volkswagen had used defeat devices to make models equipped with diesel engines appear to comply with emissions standards when they emitted far more pollution than allowed in real-world driving.

“We have voluntarily shared this information” with the U.S. Environmental Protection Agency and the California Air Resources Board, Pittel said. Ford notified the agencies this week, she said.

The EPA said in a statement on Thursday that information from Ford's investigation is “too incomplete for EPA to reach any conclusions. We take the potential issues seriously and are following up with the company to fully understand the circumstances behind this disclosure.”

The investigation has started with testing of the 2019 Ranger pickup truck, and the company expects data back next week, Pittel said.

She said it was not clear what impact the review will have on advertised mileage or fuel economy data submitted to regulators, nor is it clear how many vehicles could be affected if Ford is required to revise the data.

“We cannot predict the outcome, and cannot provide assurance that it will not have a material adverse effect on us,” Ford told investors in a regulatory filing Thursday.

“We are going to go where the investigation takes us,” Pittel said.

Ford has been embarrassed in the past by errors in fuel economy claims. In 2013, the automaker cut by seven miles per gallon the claimed fuel economy for its C-Max hybrid model following complaints that real-world mileage did not match the claimed fuel economy. In 2014, Ford lowered fuel economy ratings for six other models and offered compensation to customers.

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