Ford Motor Co. has agreed to settle a class-action lawsuit over claims that it sold defective diesel engines in its 2003-07 Super Duty pickups and E-series vans.
Automotive News reported that the now discontinued diesel 6-liter V-8, manufactured by Ford’s former diesel engine supplier, Navistar International, had myriad problems with the fuel system, turbochargers and other major components.
According to the settlement, any U.S. purchaser and lessee of any 2003-07 Ford vehicle equipped with a 6-liter Power Stroke diesel engine is covered if the vehicle’s exhaust gas recirculation (EGR) cooler and EGR valve, oil cooler, fuel injectors, or turbocharger was repaired, replaced or adjusted prior to 135,000 miles or six years.
Each component is given a reimbursement limit. In addition, according to the settlement, if a class member paid a $100 deductible more than once for repairs under the five-year/100,000-mile engine warranty, Ford will reimburse $50 each for the second through fifth deductible paid, up to a limit of $200 for four deductible payments.
The settlement resolves dozens of class-action lawsuits against the company and entitles owners to be able to claim between $50 and $825 in reimbursement for post-warranty repairs to their engine and engine components.
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Chevrolet’s Kodiak and GMC’s Topkick medium-duty truck lines will be phased out by July 31 after General Motors Corp. was unable to locate a buyer for the two divisions.
According to a story Monday (June 8) in Automotive News, GM had been searching for a buyer for its medium-duty truck business ever since the divisions began losing money in 2005. A tentative deal was struck in 2007 with Navistar International, but it expired last summer without a final sale reached.
GM’s decision to jettison the money-losing business segment was apparently fueled by its bankruptcy filing last week. The company had already decided to shed its iconic Pontiac automotive division by 2010, and its Hummer division is in the midst of being sold to a Chinese manufacturer of heavy equipment machinery. A third GM nameplate, Saturn, was sold to Penske Automotive Group Inc. last week.
Although the Kodiak was a popular platform among RV manufacturers and offered owners a dependable truck-based “C-plus” motorhome with increased load-carrying capacity, sales of the Kodiak and its GMC counterpart fell off sharply in recent years. According to GM CEO Fritz Henderson, GM sold about 30,000 units in 2007, but that number dropped to just 20,000 vehicles last year as the country entered its worst recession since the 1930s.
Available in Class 5 though 7 model lines, the Kodiak and Topkick are built in five models, with GVWRs ranging from 16,500 to 63,000 pounds.
The sale of Monaco Coach Corp. to Navistar International Inc. did not close as scheduled on Tuesday (June 2), a Navistar spokesman said.
The deal, approved May 22 by a bankruptcy judge in Delaware, was to have closed Tuesday, but Navistar spokesman Roy Wiley said he had no news to report, according to The Register-Guard, Eugene, Ore. There could be news on deal later in the week, he said.
Coburg, Ore.-based Monaco is in Chapter 11 bankruptcy. Navistar, an Illinois-based truck and engine manufacturer, was the sole bidder for Monaco’s main assets, including its factories in Oregon and Indiana.
Navistar hasn’t yet said what its plans are for Monaco plants.
The Motley Fool, not one to avoid being viciously negative on occasion and sometimes in a flippant sort of way, sounded somewhat bullish recently on Spartan Motors Inc., a chassis supplier to the RV industry.
“More top-performing CAPS (community stock research) members have been feeling bullish about Spartan Motors these days, enough to upgrade it from its long-held four-star rank to a more formidable five stars, though it has since dropped back down to four,” the Fool columnists wrote in their “This Just In” column that examines stocks.
“A total of 492 members have given their opinion on Spartan Motors, with many of them offering analysis and commentary explaining the recent optimism,” the Fool wrote.
The columnists added:
Spartan supplies chassis for RVs and emergency vehicles, and it also supplies parts to builders of military vehicles like Force Protection and General Dynamics. A dismal market for recreational vehicles has slammed Spartan just as it has dealt a severe blow to Winnebago Industries. But it has also provided others like Navistar International with a chance to pick up RV assets on the cheap.
Demand for fire truck chassis and emergency vehicles have been strong for Spartan, though, with the backlog for each growing in the recent quarter, helping offset slower sales to the RV and defense industries. It increased its gross margin in the quarter by 46% over last year, the fourth consecutive quarterly increase, and grew its cash and equivalents balance to $27.2 million thanks in part to $15.1 million in operating cash flow and only $800,000 in capital expenditures in the quarter. The continued performance and rock-bottom share price have had investors jumping back into the stock recently.
And how can you blame them? With military spending providing solid growth prospects for defense companies like Raytheon and Lockheed Martin, Spartan certainly stands to benefit, too. The company’s already working on some new developments in anticipation of a ramp-up in Afghanistan and Pentagon plans of a large order of all-terrain M-ATV vehicles this year.