WASHINGTON — Ford Motor pays $365 million to resolve U.S. allegations it violated a federal tariff legislation by misclassifying and understating the worth of tons of of hundreds of its Transit Join automobiles.
The Justice Division stated the settlement resolves allegations that Ford devised a scheme to keep away from larger duties by misclassifying cargo vans imported from Turkey from April 2009 to March 2013.
The federal government stated the settlement is among the largest customs penalty settlements in current historical past.
“Ford strongly disagrees with many of the characterizations in the DOJ’s statement and admits no liability in this matter,” a Ford spokesperson stated. “But in the interest of moving on from this complex, decade-old dispute, we have agreed to settle the matter once and for all.”
Customs and Border Safety dominated in 2013 that Transit Connects imported as passenger wagons and later transformed into cargo vans had been topic to the 25% obligation relevant to cargo automobiles, reasonably than the two.5% passenger automobile obligation.
The Justice Division stated Ford imported the automobiles “with sham rear seats and other temporary features to make the vans appear to be passenger vehicles. These temporary rear seats were never intended to be, and never were, used to carry passengers.”
Ford included these seats and options to keep away from paying the 25% obligation fee, the federal government stated.
After Customs clearance, the Transit Join automobiles had been instantly stripped of rear seats and returned to its authentic identification as a two-seat cargo van.
“The government will not permit companies to evade duties by adding sham features to their products and then misclassifying them,” stated Brian Boynton, head of the DOJ Civil Division.
Ford stated in 2021 it might withstand $1.3 billion in penalties in a long-running dispute over import duties paid on Ford Transit Join automobiles after the Supreme Court docket declined to listen to its enchantment in 2020 that it paid elevated duties for some prior imports.
The 25% tariff stems from a Nineteen Sixties commerce warfare involving frozen rooster, and the bigger tariff on cargo automobiles is called the “chicken tax.”
Ford shares had been down 0.5%.