Ford will pay $10 million in penalties after it failed to adequately respond to consumer complaints.
It comes as the Federal Court declared, by consent, that the car company engaged in “unconscionable conduct” in the way it dealt with complaints about cars fitted with PowerShift transmissions (PST).
The consumer complaints relate to Fiesta, Focus and EcoSport vehicles fitted with PST between May 1, 2015 and February 29, 2016.
The complaints centred around the cars’ excessive clutch shudder, excessive noisiness from the transmission, delayed acceleration and excessive shuddering and jerking when accelerating.
“Ford’s $10 million penalty is one of the largest handed down under the Australian Consumer Law and reflects the seriousness of Ford’s conduct,” ACCC chairman Rod Sims said.
“Ford knew that its vehicles had three separate quality issues, but dealt with affected customers in a way which the Court has declared to be unconscionable.”
The ACCC says Ford communicated with its dealers about the quality issues on multiple occasions, but did not provide adequate information about the quality issues to the customers who complained to Ford about their vehicles.
“Despite knowing that shuddering was a symptom of the quality issues with the vehicles, Ford frequently told customers that shuddering was the result of the customer’s driving style,” Sims said.
“Ford knew that the symptoms of the quality issues with the vehicles were experienced intermittently, but required customers to demonstrate them on demand in the presence of a dealer in order for repairs to be undertaken.
“In most cases, Ford refused to provide a refund or no-cost replacement vehicle to consumers, even after vehicles had undergone multiple repairs that had not resolved consumers’ complaints.”
Ford will now establish a program to review customer requests for refunds or replacements for vehicles made between the 2015 to 2016 period.
At least 2,000 affected consumers can apply for an independent arbiter to assess their complaints.
“The Court’s decision is a reminder that businesses must have systems in place to properly review consumer claims for refunds or replacements. New car retailing is an enforcement and compliance priority for the ACCC, and we will take action against manufacturers that we believe have breached the Australian Consumer Law.”
Graeme Whickman, President and CEO Ford Motor Company, Australia again reiterated today that the company took too long to address the complaints, and apologised to customers.
“As we said from the outset of this action – we took too long to identify the issues and we acknowledge that PowerShift customers did not have complaints handled appropriately between May 2015 and February 2016.
“We were overwhelmed with the volume of complaints and, while it was not intended, over a ten-month period our processes were inadequate and information provided was either inaccurate or incomplete. We let our customers down and for that we are sorry.
“This process has identified the challenges our customers faced and the lack of appropriate processes to effectively handle these.”
He added: “We are committed to making right with these customers.”
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