Ford files lawsuit against Dana for violation of indemnification clause

Article by Anita Panait, on August 2, 2012

Ford Motor Co. filed a legal action against supplier Dana Holding Corp.  on July 27, 2012 in Wayne County Circuit Court for its refusal to reimburse the carmaker for recalled subframes in 1999-2003 Windstar minivans. Ford alleges that Dana refused to pay the carmaker for defective subframes in the Windstars, which were recalled in 2011 in cold weather states.

According to the lawsuit, the refusal constituted a violation of a supply agreement between the companies, in which Dana had "impliedly assured indemnification." Ford recalled around 425,000 Windstars in 22 northern states in 2011 because the subframe parts in some of the minivans were vulnerable to corrosion from road salt used in winter.

Deterioration of those components had led to reduced steering control in some vehicles, thus increasing the risk of an accident. The subframe is a part of the vehicle that supports its engine, transmission, steering rack and front suspension. Legal actions between carmakers and suppliers may mirror a failing relationship between them.

 Before its collapse in 2009, Chrysler initiated legal actions against a number of suppliers over contractual disputes. The litigation partly ruined the carmaker’s reputation to suppliers, prompting the late Dan Knott, who was Chrysler Group's head of purchasing, to work hard just to regain its good standing with its supply chain. In May 2012, Knott’s work paid off, attaining its highest score ever in a yearly survey of carmakers’ relations with suppliers.

Topics: ford, lawsuit

If you liked the article, share on:

Comments

Recommended

Ever since the Regera premiered in 2016, Koenigsegg has been firm about increasing its coverage around the globe. Part of the idea was to ask its employees in Angelholm to...
by - February 21, 2017
There is no harm in admitting that both the conventional and the hybrid versions of the Lexus LC 500 are real stunners when it comes to its exterior styling. Even...
by - February 21, 2017
Jaguar is placing three new Ingenium engines on the F-Pace crossover, XF saloon and XE sedan for the 2018 model year. According to Jaguar’s recent announcement, the updates will also...
by - February 21, 2017
After Volkswagen snagged Toyota’s crown as the world’s best-selling automaker, there’s no stopping the Japanese manufacturer from dominating the hybrid arena. As of January 31st , Toyota’s increasing global unit...
by - February 21, 2017
There is no denying that the performance versions of the Jaguar F-Type and the Land Rover Range Rover are definitely hot – both in terms of looks and road dynamics....
by - February 21, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries