"Navistar Files Lawsuit Against Ford for Breach of Contract Involving Diesel Engines for Ford F-150 Pickup Trucks





Warrenville, IL (June 6, 2007) Navistar International Corporation (Other OTC: NAVZ) announced today that it has filed a lawsuit against Ford Motor Company for breach of contract relating to a diesel engine contract involving the Ford F-150 pickup truck and is seeking damages. The suit, filed in the Circuit Court of Cook County, Ill., seeks “at least hundreds of millions of dollars.”

Navistar believes that Ford intends to introduce a new diesel engine that actually was designed by International Truck and Engine Corporation, Navistar’s principal operating company.

According to the lawsuit, Ford is developing a 4.4 liter diesel engine for production in North America by late 2009 or 2010 or possibly earlier and intends to produce the engine itself for use in the F-150, and possibly other vehicles. The lawsuit states that Ford cannot do that without violating its contract with Navistar. Reportedly, Ford is considering producing V8 diesel engines at a Ford facility in Chihuahua, Mexico.

The lawsuit states that International spent millions of dollars and devoted years of its employees’ time to develop a next generation diesel engine named “Lion” for use in vehicles including the F-150 pickup trucks in which Ford had not previously offered diesel engines. Ford agreed that International, which has been the exclusive diesel engine supplier for Ford’s heavy-duty pickup trucks since 1979, would manufacture the new diesel engines for Ford in North America.

The lawsuit, filed June 4, is separate from previously reported litigation between the two companies. Earlier this year, Ford filed a lawsuit against Navistar involving 2007 engine pricing and prior period warranty claims on Power Stroke® diesel engines. Navistar counter-sued, stating that pricing is consistent with contractual agreements, that the warranty claims are entirely without merit and that Ford has stopped honoring the terms of an agreement under which engines were built. Navistar amended its counter-complaint on May 2 and asked for in excess of $2 billion in damages.

International’s operating company recently launched a new 6.4L Power Stroke® diesel engine for Ford that meets 2007 emissions standards while increasing performance, durability and fuel economy."

 

Ford has "mucked" this relationship up so much.... and they will wonder what happened when Toyota launches a diesel or worse yet... gets together with CAT or who knows... Navistar???

The whole strained relationship between Ford and Navistar is enough to make one stay away from their diesels as warrenty, parts, support, training and the like will be severely hampered.

From what I can tell and reading between the lines... Ford is in the wrong and Navistar in the right???

Ford should sell out like Chrysler and move on with a new partner.

 

"From what I can tell and reading between the lines... Ford is in the wrong and Navistar in the right???"

Well it was a press release from International so it presants their side of the story and not Ford's.


What I found interesting was that International claims the 4.4 was their design? The common conception I have read on here is that its design is from one of Ford's European entities.

 

navistar in my opinion is pulling at straws. they know that if ford stops buying diesel engines from them, they are gonna be in real deep dog doo.
for is in a signed contract. they did not stop buying engines from navistar, and never claimed they were going to back out of their contract. it is all a bunch of B.S. navistar is pulling to make themselves look good, and ford look bad, and dates back to navistar's failing to make good on their obligations for warranty work regarding the 6.0 engine.

if they would just buck up and work with ford, there would be no problems.

 

Or if Ford would just "buck up" and work with Navistar, there would be no problems.

 

O M G this guy has no brain. If you buy " X " product and it fails in the warranty period, What are you going to do? Claim to be fixed, or pay out of your pocket to fix the X product. Obious!.... Ok if the manufacturer denies to fixed probably your first decision stop paying what you owe to force the manufacturer to fix your product. Now the Ford & Navistar problem is a more complex situation. For what every body knows navistar is not honoring their part of the warranty on their crappy engines. Ford's reputation in diesel line pickups is pending because the lack quality on these problematic engines.

 

"Now the Ford & Navistar problem is a more complex situation."

Definately!


"For what every body knows navistar is not honoring their part of the warranty on their crappy engines."


Opinion and conjecture.

 

Actually that is hearsay and over generalization. Also he said "For what everybody knows" that logically means all people, including people at navistar and at ford(which I would hope some people in both those companies knows more then I do). Which also goes into the over generalization.

 

Maybe Ford should have tested these motors with low cetane fuel (40 - 42) which is the most common fuel most of us buy. They should have bought from regular fuel stations like the rest of us do?

Maybe Ford should have towed and worked these trucks like many of us do?

Maybe Ford should have tested a few "aftermarket tuners" just to develop a "worse case senerio" base line and knowing that many deisels get
tested" this way?

Maybe Ford should have towed at max rating throught the mountains to check for head gasket failure and "puking" and done more than a 1 week run.

Maybe Ford should have trained all their techs "proactively" instead of "on the job training". They have done better on the 6.4L... but not to do so for the 6.0L was a mistake.

Maybe Ford should have stayed with the "stock" Nasvistar tune and not tried to boost the HP and torque as much as they did? Navistar does not even come close to having the problems that Ford does with their version (VT365) of this motor?

Maybe Ford should have used the Navistar electronics and injectors like Navistar uses and not try and "redevelop" the motor with their engineers?

 

Meh, I'm all for having the diesel engines in the F150's - but I don't think I want to be buying my hardware from there...no offense

Honeywell Is moving alot of their hardware (outsourcing) to Chihuahua - and so far none of it is coming back good...

 

It's no wonder! The new trucks so expensive and that sales are down because of it! Between the health plan costs and running up the tab with ridiculously expensive corporate $450.00 per hour legal fees, the smaller diesel will end up costing as much as the bigger one does.

 

Nissan will be the invisible hand here. Ford knows if they ditch International, Nissan will start buying the engines and Ford will be without a supplier unless they can somehow start building the engines themselves (not likely), or perhaps go somewhere else - maybe Caterpillar?

 

There are a number of people that want to throw that out there, I would be willing to bet that the odds of that happening are very very slim(not to say that it wouldn't happen, but it would take a miracle for caterpillar to enter that type of market).

 

Cat as a company has some very, very deep pockets, they have the fianancial resources to do whatever they want to do. I just don't think that the way Cat is structured that they could be competive price wise with International or Cummins, but I could be wrong? I think that Ford and International will settle their differences out of necessity.

 

My long-shot bet is that Toyota and CAT team up together.

Remember... you heard it here first (and I got it from Diesel Power Magazine).