Risk management Analysis: Firestone
In the year 2000 Firestone conducted a major voluntary recall of their Radial ATX, RADIAL ATX II and all Wilderness AT tires manufactured at Firestone’s Decatur, Illinois, plant. According to the National Highway Traffic Safety Administration loss has been established in 174 deaths related deaths. This recall generated a lot of problems due to the fact that information was available to motivate the recall since 1998.
It seems the models recalled no matter how old they were had serious tread separation risks. This hazard seemed to be increased when tires were used under low pressure, at high speeds and in hot temperatures. Furthermore it seems the probability of loss is even greater when the tires are used in the Ford Explorer (Model that actually had the tires from factory production). The SUV rolls over when the tires fail being one of the leading causes of injuries and even death by tire failure.
The information available point out that the problem could have been handled better. Even though the recall was a good loss control tool its timing and range was not. From now available reports we know that Ford received complaints from tire problems in their fleet of Explorers in Saudi Arabia as soon as 1998. Ford acknowledged the situation and replaced Firestone tires for Goodyear in the Middle East, Malaysia and Thailand while Firestone denied that this was actually needed. It wasn’t until the National Highway Traffic Safety Administration started an investigation based on many customers and insurers complain that Firestone took action. It wasn’t after two years that both companies conducted a major recall in the United States.
In order to establish future risk prevention or loss control s ...