FORD LOWERS FUEL ECONOMY RATINGS - TO REIMBURSE CUSTOMERS Ford has lowered fuel economy ratings for six of its vehicles, mostly hybrids, and will reimburse about 215,000 customers after the automaker applied test data incorrectly. This is the second time in the last year Ford has had to lower mileage figures on some models, and is a setback to its reputation as a leader in fuel economy. Affected are most 2014 Ford Fiestas as well as 2013-14 hybrid models of the Fusion, Lincoln MKZ and C-Max, and plug-in hybrids Fusion and C-Max Energi. Most see a drop of 1 to 5 miles per gallon. The larger and heavier MKZ has the biggest drop: from 45 to 38 m.p.g. in combined city and highway driving. The Environmental Protection Agency has given Ford 15 days to correct its labels. Ford has told dealers that new fuel economy labels will be available in approximately six days and they may continue selling the vehicles until the new labels are received. About 200,000 customers are in the U.S. with 13,000 in Canada and 2,000 in markets where vehicles use U.S. testing results, said Raj Nair, head of global product development, in a call today with reporters. They will receive “goodwill payments” ranging from $125 to $1,050 for the estimated cost of the difference between the previous and revised fuel economy labels. The amount varies by vehicle, miles driven and whether it was bought or leased. Nair would not provide figures on the cost to the company, but said the amount will not have an impact on overall financial guidance. “Ford is taking swift, decisive action along with compensating customers against two significant backdrops: GM’s recall mess, which has prompted all automakers to address issues quickly so as not to be accused of dragging their feet, and automakers addressing fuel economy misstatements, which Ford has done before as has Hyundai/Kia,” said Michelle Krebs, senior analyst at AutoTrader: Ford first found an anomaly in testing last October, but did not know if the issue was with the test or the vehicle, Nair said. Ford confirmed the problem in March and notified the EPA. The EPA oversaw Ford’s re-testing program which required more than 100 track and lap tests to validate the entire lineup. The EPA conducted independent tests to confirm the corrected results. Ford has also agreed to implement enhanced validation tests for future vehicles under EPA oversight to make sure the error never happens again. “This issue highlights the need for continued strong oversight of the fuel economy labeling program,” said Chris Grundler, director of EPA’s Office of Transportation and Air Quality. “Consumers need to trust that fuel economy window stickers are giving consumers reliable and fair estimates of real world fuel economy.” “It’s unfortunate these figures were inaccurate initially but it’s good to see Ford following up with due diligence to correct them,” said Karl Brauer, senior analyst at Kelley Blue Book’s KBB. “There have been rumblings for a while now that some of Ford’s hybrids weren’t earning their EPA numbers in real world driving conditions,” Brauer said. “The numbers seen by many end users were beyond even the variations often seen between real world and suggested fuel economy numbers.” The error was in a portion of the testing known as Total Road Load Horsepower where a vehicle-specific resistance level is figured into the dynamometer testing. The load figure is determined using engineering models but is validated on the track in “coastdown testing” to measure the forces on the car as it rolls down a slope. It was in the coasting test of the Fusion hybrid that Ford found the load numbers it was using did not match real-world results. The problem was traced to wind tunnel results correlated under a new process implemented by Ford. It has since been corrected and all new figures verified in real-world tests. “This is our error. When we see an issue, we address it,” Nair said. No one has been disciplined for the error and Nair said ultimate responsibility rests with him as head of product development. No other label adjustments are planned. “Ford isn’t the first manufacturer to admit that it was optimistic in its EPA fuel economy ratings, and it might not be the last,” said Jack Nerad, editorial director at KBB. Nerad said the EPA might be prompted to take more control of how fuel economy rules and ratings are administered. “At the very least we expect tighter auditing of the process, so that substantial discrepancies over a sizable number of vehicles do not occur in the future..” Few drivers achieve the combined m.p.g. on the sticker of a new car but the EPA figures are helpful in determining the fuel efficiency of one vehicle compared with another. Last year Ford voluntarily lowered the claims for the C-Max hybrid. Ford took advantage of the “general label” rule that allows automakers to test the volume vehicle in a family and apply the results to other models with the same weight, engine and transmission. Ford tested the Fusion hybrid, sedan and applied the 47 m.p.g. results to the boxier C-Max. Ford changed the C-Max sticker to 43 m.p.g.
Posted on: Tue, 17 Jun 2014 13:10:40 +0000
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