Ford Explorers with Firestone Tires
In the summer of 2001, a widely publicized lawsuit led to hundreds of deaths from vehicle rollovers being attributed to Ford vehicles with Firestone tires - and in the spotlight, the two companies turned on one another, each indicating that the other was sole to blame for the situation.
The relationship between Ford and Firestone goes back to 1906 (the founding individuals, Henry Ford and Harvey Firestone, were close friends) . In 1988, Tokyo-based Bridgestone Corporation bought Firestone, but remained the sole supplier for many Ford vehicles.
In 1999, Ford noticed a record of failures of tires in hot climates (Venezuela and Saudi Arabia), and began replacing tires in those locations with a more suitable model, but did so quietly.
In 2000, the problem began to evidence itself in the united states, particularly Texas and Florida. About this time, both companies began to gather evidence against the other - Ford indicating that the tires were the problem Firestone blaming the vehicles.
When the problem became a media feeding-frenzy, each company persisted in blaming the other. The distrust between he companies grew until, in May 2001, Ford abruptly ended the 95-year relationship between the companies.
The Blame
Ford's part of the blame comes from its failure to examine its own vehicles' performance in differing environments. The rollover risk of high-profile vehicles is a well-known problem, and the company failed to do sufficient testing. There is also some potential profit motive, in that heat-resistant tires are more expensive. Even when the problem became known, Ford was slow to react, and its reaction (replacing the standard tires on vehicles sold in hotter areas) was insufficient.
Firestone was not blameless. There had been incidents where the company had issued recalls of tires that were prone to failure, and knew the grade of tires they sold to Ford were unsuitable for hot climates, but they failed to sufficiently advise Ford or the problems of which they were aware (trusting in Ford to do its own testing, and make the right decision of what tires to issue on its vehicles).
Some criticism has also been made of the government (the NTSB in particular), who was aware of the statistics but was very slothful in investigating the problem.
Finally, there is some truth to the blame placed on consumers, some of whom insisted on cheaper options, neglected to maintain their tire pressure, heavily loaded vehicles, and drove too fast over long periods.
Consequences
Both companies suffered financially due to voluntary and mandatory recalls, but the situation was worsened by the contention between them - the evidence they presented against one another exacerbated the problem and harmed both companies, both in the market and in their relationships with business partners.
Ford's refusal to admit there were any problems with its vehicles did much to harm the reputation of their brand in the marketplace, and consumers flocked to other companies for light trucks and SUVs.
Bridgestone, being smaller than Ford, took a great deal of damage: its sales dropped 80% and the cost of lawsuits was substantial. There was serious doubt that the Firestone brand, which had a 100-year history and great strength in the marketplace, was viable.
The resurrection of both brands (which some called the most unlikely in marketing history) took several hears and a few billion dollars- but it's worth noting that both Explorer vehicles and Firestone tires have, by now, largely recovered in the marketplace due to extensive marketing by both firms, and the relationship between the two companies has been mended.
Lessons Learned
The health and safety of customers who use a product should be considered to be analogous to the reputation of the firm.
Companies must be zealous about product safety. Testing should be thorough and objective, and the short-term consequences of production delays should be considered less significant than the long-term detriment of being seen as a company that manufactures unsafe products.
Suspicions about product safety should be thoroughly investigated, and responses rapid, in the face of any evidence of product safety concerns.
When working in partnership, plan a conciliatory salvage strategy. Treat the problem as a common one, to be addressed cooperatively. Ford and Firestone did an excellent job of this after the fact, but a rotten one beforehand.