The ACCC has instituted proceedings against Ford Australia as it alleges that the company engaged in unconscionable and misleading or deceptive conduct.
Accusations by the consumer watchdog surround false or misleading representations in Ford's response to customer complaints.
The customer complaints were about Ford’s Focus, Fiesta and EcoSport vehicles supplied in Australia between 2011 and 2016, which featured a type of transmission known as PowerShift Transmission (PST).
The ACCC alleges that about half of the 70,000 vehicles sold had at least one repair relating to the PST.
Customers made complaints to Ford and its dealers about their car’s excessive shuddering and jerking when accelerating, loss of gear selection and sudden loss of power and/or excessive noisiness from the PST.
From 2011 to May 2015, Ford allegedly refused to provide a refund or replacement vehicle to consumers, even after vehicles had undergone multiple repairs that had not fixed the issue.
ACCC Chairman Rod Sims said in most cases Ford refused to provide a refund or a replacement vehicle unless customers participated in the Powershift Ownership Loyalty Program by making a substantial payment for a replacement vehicle, which was on average $7,000.
“The ACCC alleges that Ford misrepresented to customers who made complaints that the issues with their vehicles were caused by the way the driver handled the vehicle, even though Ford was aware of systemic issues with the vehicles from at least 2013.
“The ACCC alleges that Ford’s conduct towards customers who had complained of issues with their vehicles was unconscionable. It is also alleged that Ford then on-sold vehicles surrendered as part of the Powershift Ownership Loyalty Program to wholesalers and customers, without disclosing the systemic or specific issues experienced with those vehicles.
“The ACCC is alarmed about the level of non-compliance with the Australian Consumer Law in the new car industry, which has been laid bare in our new car retailing market study due out next month. Cars are the second-most expensive purchase most consumers will ever make and if they fail to meet a consumer guarantee, people are automatically entitled to a remedy.
“The ACCC urges all vehicle manufacturers to ensure their complaints handling processes provide the remedies that consumers are entitled to get under the Australian Consumer Law or, like Ford, they will find themselves in court."
The ACCC is seeking declarations, injunctions, pecuniary penalties, consumer redress orders, corrective advertising, and compliance program obligations.