The Australian Consumer and Competition Commission (ACCC) has started proceedings against Ford Australia in the Federal Court of Australia, over long-running concerns regarding the company’s PowerShift automatic transmission fitted to variants of the Ford Focus, Fiesta and EcoSport sold between 2011 and 2016.
In a statement released today, the ACCC alleges Ford has engaged in “unconscionable and misleading or deceptive conduct, and made false or misleading representations in its response to customer complaints”.
The ACCC alleges that Ford refused to provide refunds or replacement vehicles to owners whose vehicles had undergone multiple repairs, despite obligations made clear in the Australian Consumer Law. (See our story here on what you should do if affected.)
The statement goes on to say that in cases where replacement vehicles were offered, Ford had allegedly only done so on the condition that consumers made a “significant payment” toward the vehicle as part of its “PowerShift Ownership Loyalty Program”.
The ACCC alleges the payment required was, on average, $7000. The ACCC’s Federal Court Notice of Filing alleges that, as of July 2016, more than 800 customers had paid amounts totalling “more than $6.5 million”.
“As a result, customers who could not afford to make these payments felt that they had no option but to continue to use their vehicles,” the statement reads.
It is also alleged that vehicles surrendered to Ford as part of that replacement were on-sold to wholesalers and customers, “without disclosing the systemic or specific issues experienced with those vehicles”.
The ACCC is seeking declarations, injunctions, pecuniary penalties, consumer redress orders, corrective advertising, and compliance program obligations. What shape these penalties may take is still to be confirmed, although the Australian Consumer Law allows for a maximum penalty of $1.1 million for corporations.
Ford released a response today that it “strongly refutes” the allegations, listing the steps it has taken to address the matter with owners.
The company says it has worked with owners wherever the issue has been identified, working “with customers to implement manufacturing and repair solutions”.
“Ford has also been proactively reaching out to the most affected customers to provide them with the latest specification clutch free of charge. A total of over 12,000 customers’ vehicles have already been upgraded,” the statement reads.
The company’s president and CEO in Australia, Graeme Whickman expressed regret at the experiences of affected customers, but stressed every action has been taken to resolve each matter.
“We acknowledge that some customers had a poor experience when the clutch shudder issues on the PowerShift transmission first came to light and we are sorry for this,” Whickman said.
“We’ve continued to improve our response times to customers and have been repairing vehicles, compensating customers, and depending on the circumstances, providing full refunds and providing replacement vehicles.”
“Repairs are available for all PowerShift transmission issues and all new vehicles on sale today are built with the latest updates.”
Whickman said that while the company strongly refutes the ACCC’s allegations, “we will work with them wherever needed to help provide certainty about the application of Australian Consumer Law for our industry.”
In a briefing this afternoon, Whickman said: “This is not a safety issue. The Department of Infrastructure and Regional Development, the regulator responsible for safety issues in the automotive space in Australia, have investigated this issue and have no safety concerns.”
Ford urges concerned owners to call either their dealer or the company directly on 13FORD (13 36 73).
Last year, a class action was launched against Ford by Bannister Law on behalf of affected owners. The suit alleges the PowerShift system “slips, bucks, jerks, and harshly engages when driven”. You can read more about this action at the link below.
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EXTERNAL: ACCC – Consumer rights & guarantees