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Ford (F) Recalls 550K Vehicles to Resolve Seat-Back Issue

Zacks Equity Research

Ford Motor Company F has recalled more than 550,000 trucks and SUVs in North America to resolve an issue with the vehicles' seat backs. Per the company, the third pawl required for seat-back strength may be missing from these vehicles. In case of a crash, this poorly-assembled recliner mechanism might be unable to restrain the passenger adequately, thus escalating the risk of injury.

Nevertheless, Ford has stated that it is unaware of any crashes or injuries. The company’s latest action will affect 483,325 vehicles in the United States and the federal territories, 58,712 in Canada, and 8,149 vehicles in Mexico.

The affected vehicles include Ford F-150 from the company’s 2018-2020 models, Ford F-Series Super Duty trucks and Expedition vehicles from the 2019 and 2020 models, and Explorer SUVs from 2018 through 2019. The safety recall also includes some 2020 Ford Explorer and Lincoln Aviator vehicles with rear seats, along with manual seat-back recliner mechanisms. These vehicles feature manual driver or front-passenger seat-back recliner mechanisms.

The Ford F-150 vehicles were manufactured in the Dearborn Assembly Plant from Sep 14, 2018 through Aug 7, 2019, and the Kansas City Assembly facility from Sep 11, 2018 through Aug 2, 2019. The Ford F-Series Super Duty vehicles were built at the Kentucky Assembly Plant from Sep 9, 2018 through Jul 22, 2019, as well as the Ohio Assembly Plant from Sept 11, 2018 through Jul 17, 2019. Further, Explorer SUVs were built from Sep 9, 2018, through Mar 3, 2019 in the Chicago Assembly facility, while Expedition vehicles were manufactured from Oct 16, 2018 through Jul 24, 2019 in the Kentucky Assembly Plant.
 
Meanwhile, the 2020 Ford Explorer vehicles were built in the Chicago Assembly Plant from Nov 21, 2018 through Aug 21, 2019, whereas the Lincoln Aviator vehicles were manufactured in the Chicago Assembly Plant from Apr 12, 2019 till Jul 16, 2019.

Dealers will examine the seat structure of the affected vehicles, with most of these expected to clear the inspection without any requirement for repair. In case of any need for repair, the dealer will replace the seat structure without any service charges from customers.

Like some of its peers, Ford too has been recalling vehicles due to safety issues. Frequent recalls for fixing faulty vehicles are concerns for the company. Apart from higher expenses for repairing faulty vehicles, recalls also hurt consumers’ confidence in a brand. In fact, in August, Ford announced the recall of more than 108,000 mid-size cars in North America in a bid to resolve an issue with seat belt anchor pretensioners. The vehicles’ front seat belt cable could reduce the strength below the required level due to heat buildup, which may not sufficiently restrain passengers.
 
Further, this July, Ford withdrew nearly 58,000 Focus cars in North America which had an issue with the powertrain control module software that could deform the vehicles’ fuel tanks. Also, earlier in June, the company recalled 1.2 million Explorer SUVs, citing a potential suspension link-fracture issue. In May, it recalled roughly 273,000 of Ford Ranger pickups and Fusion vehicles in North America. In April, the company recalled nearly 874,000 trucks for engine block heater cable defects.
 
Apart from recalls, Ford also announced that the government has initiated criminal investigation against the company over an emission certification matter.

Ford Motor Company Price and Consensus

Ford Motor Company Price and Consensus

Ford Motor Company price-consensus-chart | Ford Motor Company Quote

Zacks Rank & Stocks to Consider

Currently, Ford carries a Zacks Rank #3 (Hold).

Some better-ranked players in the Auto-Tires-Trucks sector include IAA, Inc. IAA, BRP Inc. DOOO and Fox Factory Holding Corp FOXF. While IAA sports a Zacks Rank #1 (Strong Buy), BRP and Fox Factory holds a Zacks Rank #2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

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