Ford to Pay Massive Settlement for Misclassifying Turkish-built Vehicles

Ford to Pay Massive Settlement for Misclassifying Turkish-built Vehicles

Would you have ever guessed that Ford would go to such lengths to avoid paying higher duties on their imported vans?

Ford Motor Company will be shelling out a whopping $550 million to resolve allegations that it violated US federal tariff laws by misclassifying and underestimating the value of its Turkish-built Transit Connect vehicles. This settlement, one of the largest of its kind, comes after Ford was accused of implementing a scheme to avoid higher duties by falsely classifying the light commercial vans it imported and sold between 2009 and 2013.

According to recent reports from Reuters, the US Justice Department announced that Ford Motor Company has agreed to pay a massive $550 million settlement. This settlement puts an end to the allegations that Ford unlawfully misclassified and undervalued hundreds of thousands of Turkish-built Transit Connect vehicles, thus violating federal tariff laws. It turns out that Ford had a clever plan up its sleeve to dodge those pesky higher duties. Ford deliberately applied an incorrect classification to the light commercial vans it imported and sold between April 2009 and March 2013.

The US government claims that this settlement is one for the books, as it is one of the largest settlements of its kind in recent history. The Justice Department discovered that Ford went to great lengths to avoid paying higher duties. How, you ask? Well, it seems that Ford equipped the imported vehicles with what they call ‘sham rear seats’ and other temporary features that made the vans look like passenger vehicles. Sneaky, right? But here’s the catch: those temporary rear seats were never actually meant to carry any passengers. Nope, not at all.

So, why would Ford go through all this trouble? The answer is simple: money. By including these sham features, Ford managed to skirt around a 25% duty rate. But don’t be fooled, after clearing customs, those seats were immediately stripped from the vehicles, revealing their true identity as a two-seat van. You see, passenger vehicle imports only face a 2.5% import tax in the United States. Ford thought it could pull a fast one on the government, but it got caught red-handed,

  • Ford to pay $550 million settlement over misclassification of vehicles
  • US government alleges Ford intentionally misclassified imported vans to avoid higher duties
  • Scheme involved adding temporary features to vans to make them appear like passenger vehicles
  • Ford discontinues sale of Transit Connect in the US

In response to the allegations made by the US Department of Justice, Ford denies any liability and strongly disagrees with their characterizations in this matter. However, in an effort to put this complex and decade-old dispute behind them, Ford has chosen to settle the matter once and for all. As part of this settlement, Ford will discontinue the sale of the Transit Connect in the United States, making it an exclusive offering in Europe.