Ford Motor Co. has filed a lawsuit accusing International Truck and Engine Corp. of violating their long-standing engine supply contract. Pricing of International’s new 6.4 liter engine appears to be one issue.
Ford reportedly said in the suit that International refuses to negotiate in good faith and has threatened to halt deliveries of the engine if International`s price isn`t met. But the trigger for the lawsuit seems to be a dispute over warranty costs. Ford says International hasn`t been paying its share of engine-related warranty costs as called for in the agreement. Ford debited what it felt International owed from payments for new engines and, immediately after, filed the suit. Ford is asking the court to allow the debit and to order International to pay future warranty costs.
“The debit is simply a business transaction intended to resolve a dispute we have with ITEC over its contractual obligations,” said Kristen Kinley, Ford Environmental and Legal Communications. “We have made every attempt to settle this dispute with ITEC. Regrettably, they have not cooperated, therefore we have no other choice tot to take the debit and file the lawsuit. Our preference, and hope, is to reach an amicable solution with ITEC.”
International spokesman Roy Wiley said the Ford claims “are totally without merit” and the company will “vigorously oppose them in court.”
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