The long running Navistar/Ford dispute over warranty claims, pricing and other supply details vis-à-vis the Navistar-made Powerstroke diesel engines is over. The official press release [via Yahoo! News] gets right to the point: “Ford Motor Company and Navistar International Corporation have reached an agreement to restructure their ongoing business relationship and settle all existing litigation between the companies.” The engine supply deal is officially dead as of December 31, 2009. Cash is changing hands, but nobody is saying how much: “As a result of the agreement, Ford will make a payment to Navistar.” The South American and Blue Diamond F-650/750 joint projects will continue, for now. Cummins is the supplier of record for Ford branded F-650 and F-750 diesel engines but the trucks are actually produced in Mexico based on a Navistar design. International, meanwhile, sells version of the same trucks with its own engines. 
Outside of the Blue Diamond deal, Navistar seems to be backing away as fast as possible from the 2.8. Navistar recently pulled out of a deal to buy GM’s remaining large truck business, and now they are out of the Super Duty engine supply game. Ford’s new in-house 4.4 liter Powerstroke design is a done deal for that magical model year 2010. Little love seems to be lost between the Powerstroke owner’s community and Navistar, so don’t expect a big run on the remaining 08/09 Navistar powered Super Duty trucks.
Tagged as
Ah, I read the press release yesterday and wondered whether this would mean the end of Ford Powerstroke diesels, at least for now. I knew they were developing a smaller diesel for their 1/2 ton pickup (as are GM and Dodge for their 1/2 tons), but didn’t know this would also replace the Navistar-sourced Powerstroke in the F250 and F350. Thanks.
It should be “Vis-à-vis”
It’s hard to say why Navistar is backing away, or if they’re being rebuffed. The debacle with Ford may have done some real harm to their reputation.
psarhjinian :
I’ve revoked John’s visa.
There’s a 6.7L in-house design in the works. 2011 is the speculated date… no word on if there will be a time gap between that and the cut-off of 6.4L supply.
The 6.0L and all it’s problems killed the relationship (amongst other political and financial issues). Navistar will part ways with Ford much like Firestone did.
While I don’t know who’s most at fault here, from what I’ve heard the cost and maintenance schedule for today’s diesels is too much for the average truck buyer.
EGR is hell on engine longevity. They are not the only engine maker that struggled with trying to get their diesels to meet the 2004 emissions standards.
Caterpillar stumbled the transition as with their twin turbo ACERT engines as well. They have gone from being the dominant engine OEM to exiting the market USDM in 6 years.
International is actually doing quite well right now relative to the rest of the heavy truck industry. The military side of the house has been going gangbusters with MRAPs and a strong contender to replace the HMMWV. The new ProStar class 8 tractor is a success and they are gaining market share amongst the big fleets that were all Freightliner for the past decade.
All I can say is that Ford probably got out of that on the cheap. The contract was signed through 2012, I believe, and Navistar had sued them for $2 billion for breech.
I’m sure the complete destruction of the diesel truck market hasn’t helped either…
It also looks like Ford is slowly extracting itself from the HD market. With a minority stake in Blue Diamond, there’s really just the F-550 left.
What was wrong with the PowerStroke diesels? I don’t follow trucks really so I hadn’t heard of that.
and a strong contender to replace the HMMWV
The HMMWV is being replaced? More news to me.
Did Cummins have problems with their diesels?
NickR
Basically the issue was with warranty charges, though I understand there were other problems too. The Powerstroke had more warranty claims against it than the rest of Ford’s line-up combined, like horribly atrocious numbers. There’s been a ton of fighting over this, up to the point where last year I remeber something about a judge forcing either Navistar to keep shipping or Ford to pay money so that Navistar would ship, as they basically gave them a stop-ship situation and wouldn’t budge. Navistar blames Ford, Ford blames Navistar, they do the hokey pokey…
The Navistar-sourced 6.0L powerstroke diesel engines were unmitigated garbage, a fitting match for a ’72 Vega but not much else. Navistar thought they had Ford by the balls with contract legalese, committing them to continued payment and acceptance of substandard manufactured engines for the duration without recourse. Apparently Ford saw things differently and decided that even a breach of contract punitive award was worth it to get out of, as JGH correctly compared, a Firestone-like situation.
The 6.4 Stroker not much better. 7 count em 7 radiators and coolers in front of a cramped engine bay. And when your Ford dealer needs to replace the Powerstroke? No problem. They only need to remove the entire cab assembly from the frame to do the job!
In the light and medium duty arena the Cummins and Duramax are far superior.