A lawyer who helped broker the deal on behalf of consumers said the Ford payout could exceed $100 million.
"There's no cap. The truth is, Ford is going to have to pay out claims until they're exhausted," said Tarek Zohdy of Capstone Law in Los Angeles. "In my opinion, Ford will have to deal with these vehicles until people are done filing their claims."
He explained, "This settlement is entirely reliant on the consumers' decision to file a claim. ... It's up to the consumer whether they want to let Ford keep their money. ... They created a defective transmission and I wanted to help people get their money back."
Ford lawyers have worked with class-action attorneys to resolve the case, which was filed in 2012.
"Ford believes the settlement is fair and reasonable, and we anticipate it will be approved by the court following the hearing next month," Ford spokesman T.R. Reid said late Friday.
The proposed agreement in U.S. District Court for the Central District of California improves on an earlier version that an appeals court declined to accept in September. Improvements include:
- A guaranteed commitment from Ford of $30 million in cash reimbursement to consumers who have a record of multiple failed transmission repairs within five years of buying their cars or 60,000 miles
- An easier process for former owners and people who leased the cars to get compensated
- Simplifying a buyback program for defective vehicles
Entry-level Fiesta and Focus vehicles, built over the last decade, have a history of costly repairs for failing transmissions and other problems. A Detroit Free Press investigation, "Out of Gear," revealed in July for the first time internal Ford documents and emails showing the company knew the transmissions were defective from the start but continued building and selling them anyway.
The lawsuit alleged Ford lied to unload cars with faulty transmissions on unsuspecting buyers and then blamed the drivers for problems they experienced.
Ford customers claimed in legal filings their 2012-16 Focus and 2011-16 Fiesta compact cars were built with transmissions prone to “shuddering, slipping, bucking, jerking, hesitation while changing gears, premature internal wear, delays in downshifting and, in some cases, sudden or delayed acceleration.”