An auto industry watchdog group accused Ford Motor Co. (NYSE:F) Thursday of selling more than 200,000 Taurus and Sable cars with faulty ethanol-capable fuel systems, asking the federal government to impose $136 million in fuel economy penalties and force Ford to change its advertising.
Ford contends the vehicles meet all federal standards, and denies it has misled either the government or buyers. It also defended its use of fuel economy credits, saying the program has worked as Congress intended to create demand for E85, the blend of 85% ethanol and 15% gasoline.
Ethanol-capable vehicles have been the top environmental talking point for Ford and other Detroit automakers this year, as all three have committed to doubling their output of E85-ready vehicles to 2 million annually by 2010.
Public Citizen said in a complaint to the National Highway Traffic Safety Administration that Ford Tauruses and Mercury Sables from the 2003 to 2005 model years ran so poorly on 85% ethanol-blended fuel that they should not be considered flex-fuel vehicles, which earn extra credits under federal fuel economy standards.
The program assumes flex-fuel vehicles run on E85 half the time, even though many such vehicles never see a drop of E85 in their tanks. By building 228,032 flex-fuel Taruses and Sables over those three model years, Ford was able to keep its average fuel economy near the standard set by NHTSA of 27.5 m.p.g.. Without the ethanol credits, Ford’s average for its cars would have fallen as low as 25.8 m.p.g., Public Citizen said.
Automakers may miss fuel economy standards for one year, but must pay fines based on vehicle sales or use credits from years when their fuel economy surpassed the standards. By Public Citizen’s math, Ford would owe the government $136 million if its ethanol credits were removed.
“We believe Ford wrongly claimed credit for it, and we think the agency ought to investigate it,” said Joan Claybrook, Public Citizen’s president and a former NHTSA administrator.
Claybrook and the ethanol groups said they had not received any similar complaints involving other automakers’ flex-fuel vehicles.
In addition to NHTSA, Public Citizen filed a complaint with the U.S. Federal Trade Commission under truth in advertising rules, asking that Ford be barred from marketing E85 vehicles in states with few or no E85 pumps, which inflates fuel economy numbers.
Both filings cite consumer complaints from Nebraska, namely a corn farmer named Dave Buss who bought a 2005 Taurus last September with the intention of burning E85 in it much of the time. Buss told his Ford dealer that the Taurus was hard to start and ran roughly on E85, occasionally stalling, and that Ford eventually told him to solve the problem by using regular gasoline.
According to documents filed with Public Citizen’s complaint, the dealership confirmed Buss’ troubles, and when it asked Ford about the issue, it was told that the behavior was typical for E85-capable Tauruses. In a Nov. 9, 2005, bulletin to dealers, Ford said it was working on a solution to the problems, but that dealers should tell customers to use only regular gasoline until a fix was found.
Other agencies have also reported problems burning E85 in Tauruses, which have been sold mostly to business and government fleets over the past few years. The National Ethanol Vehicle Coalition, a group that promotes E85 fuel, says it had received an unspecified number of complaints about Ford Tauruses running poorly on E85.
Todd Sneller, the administrator of the Nebraska Ethanol Board, said he began having starting problems shortly after getting his 2004 Taurus, and had heard from fleet owners and others of similar troubles.
Sneller said Ford provided a fix for his vehicle earlier this year, which requires him to turn the key to the “on” position for about 15 seconds before trying to start the engine.
“I found a satisfactory solution, but that’s not the case with some fleet managers who’ve had to incur additional costs,” he said.
Claybrook said if Ford had a solution, it should issue a recall rather than waiting for consumers to come to dealers for a repair.
“They’re getting credits for them,” she said. “They’d still be violating the program if the vehicles work on E85, but they’re not fixed.”
Ford said the problem did not affect all flex-fuel Tauruses and Sables and did not consider it a defect. Ford spokeswoman Jennifer Moore said the company told customers that some flex-fuel vehicles that had not burned E85 for a number of years would need a break-in period, where customers should use a mixture of gasoline and E85.
Sue Cischke, vice president of environmental and safety engineering for Ford, said the company had followed Congress’ lead in promoting flexible-fuel vehicles. She said any customer with a problem should contact Ford.
“There is nothing misleading about our flexible-fuel advertising,” Cischke said in a statement. “FFVs operate no differently on E85 than they do on gasoline. Our FFVs are certified to operate on E85.”
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