By on January 27, 2020

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Ford Motor Co. has agreed to settle a class-action lawsuit with almost 2 million owners and former owners of Focus and Fiesta models equipped with the now infamous six-speed dual-clutch PowerShift transmission. Internally referenced as the DSP6, the unit was a known problem prior to installation. Last year’s scathing report in the Detroit Free Press showed its dark history in gory detail, indicating the automaker had painted itself into a corner and ignored warnings from both engineers and legal advisors not to use the DSP6.

Complaints of vehicles shuddering and stalling, bizarre delays between gear changes, and even full-blown failures to go into gear began streaming in — leaving Ford to pick up the pieces and attempt to downplay the failure as much as possible. Unfortunately, more engineers came forward to bash the transmission over its development and implementation. Johnny-on-the-spot for the topic, the Detroit Free Press recently reported that Ford agreed to settle — with one of the lawyers brokering the deal saying the payout could exceed $100 million.

We’ve also learned how much money Ford spent repurchasing defective vehicles through a voluntary arbitration program conducted during the legal appeal. Court documents state the company bought back 2,666 vehicles for around $47,500,000 between October 2017 and December 2019. 

“There’s no cap. The truth is, Ford is going to have to pay out claims until they’re exhausted,” Tarek Zohdy of Capstone Law in Los Angeles explained. “In my opinion, Ford will have to deal with these vehicles until people are done filing their claims.”

“This settlement is entirely reliant on the consumers’ decision to file a claim,” he continued. “It’s up to the consumer whether they want to let Ford keep their money … They created a defective transmission and I wanted to help people get their money back.”

Affected vehicles include the 2011-2016 Fiesta and 2012-2016 Focus models equipped with the six-speed PowerShift; the proposed agreement is an improvement of an earlier version a California appeals court declined to accept last September. Changes include: A guaranteed commitment from Ford of $30 million (minimum) in cash reimbursement to consumers who have a record of multiple failed transmission repairs within five years of buying their cars or 60,000 miles; easier processes for former owners and people who leased to get compensated; and simplifying a buyback program.

Ford has been working on the case since 2012 and said it found the latest proposal agreeable, despite it being much tougher on its business. It also warned shareholders in April of legal exposure related to the DPS6 transmission in a Securities and Exchange Commission filing, so none of this was a complete surprise.

“Ford believes the settlement is fair and reasonable, and we anticipate it will be approved by the court following the hearing next month,” Ford spokesman T.R. Reid said on Friday.

U.S. District Judge Andre Birotte Jr., is scheduled to hear the case February 28th for final approval.

[Image: Ford Motor Co.]

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44 Comments on “Ford Agrees to Pay Out Over Faulty DSP6 Transmissions...”


  • avatar
    saturnotaku

    Capstone – that’s the same firm litigating the Hyundai dual-clutch transmission class-action suit. The hearing to approve the settlement is scheduled for early March.

    • 0 avatar
      dukeisduke

      The Hyundai DCT – is that the same one that Kia is putting in the sportier version of the 2020 Kia Forte?

      • 0 avatar
        saturnotaku

        I assume so. It’s likely the improved unit that was put in starting with the Kona and Elantra GT. The lawsuit covers the first run of gearboxes that appeared in the OG Veloster turbo, 2015-17 Sonata Eco, and 2016-17 Tucson.

  • avatar
    FormerFF

    I really don’t understand why they kept installing that transmission for all those years. After the first year or two of problems, why not put a conventional automatic in its place?

    It always amazes me how so many members of upper management are utterly inept at their jobs.

    • 0 avatar
      JMII

      If its anything like the upper management at my company its a simple case of the emperor has no clothes. Such “leaders” can not and do not believe anything could be wrong with their pet project. Any low level employees asking too many questions or pointing out flaws are considered being negative and such behavior is not allowed. Nobody can question the knowledge of the all mighty tallest. The sin of pride has been the downfall of many.

    • 0 avatar
      TMA1

      Theories:

      1. No one complained in Europe, where the transmission debuted. But those people think Volkswagens are reliable, so that doesn’t say much. Good enough for the USA!

      2. CAFE. Car makers don’t add DCTs (especially dry-clutch garbage like the Ford unit) or CVTs, or turbo 3-pots, because it’s good for you. They do it because it’s good for them. #1 reason we should support fuel economy rollbacks – proven technology is good for the consumer, and better than a combined 1 mpg gain at the cost of significantly reduced usable life.

      • 0 avatar
        MoDo

        Its CAFE for sure. Same reason why smooth V6’s are being replaced by turbo 4cylinders that get worse mileage under boost but can beat the V6’s in fuel mileage testing, the same BS testing that isn’t even accurate to begin with. They game the system and we pay for it.

        • 0 avatar
          FreedMike

          Yep, I figured it was only a matter of time before CAFE got blamed. And it’s nonsense.

          EPA mileage figures of comparable cars:
          2012 Ford Focus automatic (DCT): 28 city/38 highway
          2012 Hyundai Elantra (non DCT): 28 city/38 highway
          2012 Chevy Cruze (non DCT): 26 city/38 highway
          2012 Mazda 3 (non DCT): 26 city/38 highway

          I excluded cars with a CVT on purpose – the cars used here were all “standard,” non-CVT, non-DCTs. Would Ford have gotten significantly better mileage with a non-DCT? I don’t think so.

          DCTs are actually used primarily for performance, not fuel economy – they shift quicker. That’s why you find them in cars like the GTI. Ford was going for a “Euro” feel with the last-gen Focus, and the transmission was part of it.

          • 0 avatar
            HotPotato

            I think they must have shifted those goalposts though. I’ve driven a Fiesta with this trans and it had a nice, decisive, sporty Euro feel. I’ve driven our fleet Foci with this trans and the shifts are slowed and slurred to mimic a conventional auto.

    • 0 avatar
      tomLU86

      They are hardly inept.

      They are very accomplished…sycophants.

      They are given targets–meet or beat metric “X” for less than “$x,xxx”.

      If it is unrealistic or unattainable, they can take a chance and try to explain. The best “explainers” survive. There are very few people who can tell their boss no in a positive, earnest way, and survive. The other 95% can not. Knowing this, I’d say 99% of senior leaders do whatever they must to meet the metrics. Success is rewarded with a large bonus high on the food chain, and with an opportunity to come to work again on the lower parts of the pyramid. Those who do not comply, and don’t ‘demonstrate the proper values and behaviors’ are removed, either immediately, or when it is convenient for their bosses.

      Crap like the DSP6 is sometimes the result. The DPS6 is a more extreme example of what happens.

      And this type of behavior at the top sets the tone.

      Where was the great Alan when this was going down? For that matter, where was the Ford family? They got theirs, who cares….

      Mullaly is gone, but he was probably a driven cost-cutter. His legacy lives on in the DPS-6.

      In the short term, he got his, but in the long term, many others, first and foremost, the buyers of these sh*Tboxes, had to pay for it. Not to mention FOrd’s reputation, and lost sales.

      And that’s just how the world, especially America, works. See Matthew 25:29, and Luke 19:26.

      Grossly overpaid execs. Instead tirelessly pursuing cheap Mexican labor, perhaps the American companies would be better served by obtaining less expensive (but still compensated in 7 figures) Asian CEOs. They might set a different culture.

      Don’t count on it. Likely the Detroit newspaper had not so shamed and embarassed Ford, they would try to keep this debacle swept under the rug.

    • 0 avatar
      dal20402

      They didn’t substitute a conventional automatic because it would have worsened fuel economy.

      But why they didn’t substitute a CVT is probably the reason JMII says. A CVT would have returned similar fuel economy, would have been better to drive, and appropriate units were readily available both within and outside Ford.

      • 0 avatar
        TMA1

        Wasn’t Ford just coming off a string a miserable CVTs with the 500 and Freestyle when this was being designed? Bad enough that they actually did ditch those transmissions for conventional units when the cars were refreshed and rebadged as the Taurus/Taurus X. No wonder Ford doubled down on the DCT.

      • 0 avatar
        FreedMike

        Any number of comparable compacts with “traditional,” non-DCT automatics, got very similar mileage to the Focus, dal. See above. I don’t think the Focus would have gotten substantially worse mileage with a non-DCT.

        In the case of the Focus, I think it was more about Ford wanting it drive more “European,” so a DCT makes sense in that context. Ford’s mistake was making the Focus’ transmission a dry-clutch unit.

        But it’s convenient to blame CAFE, so that’s what happens.

    • 0 avatar
      Felix Hoenikker

      Most of my working life in the private sector was spent in three large publicly owned companies. How such a bad decision as the Ford DCT could muddle along is not a great mystery if you understand organizational dynamics. This thinking is laid bare in the this link. I only wish I had this info earlier in my career.

      https://www.ribbonfarm.com/2009/10/07/the-gervais-principle-or-the-office-according-to-the-office/

      • 0 avatar
        SSJeep

        Its simple – too many “yes” men and women who dont want to risk the ire of an executive. So what is happening on the ground never makes its way to the C-suite. The same thing happened at Boeing. The C-Suite doesnt hear about the bad stuff until it is way too late – and in a cruel twist of irony, most of the issues were due to executive cost-cutting and shareholder immediate profit appeasement in the first place.

    • 0 avatar
      jkross22

      FF,

      What’s to understand? As with nearly all big corporations, leadership – if you want to call it that – is incentivized by quarterly reports, not by long term thinking and strategy.

      It’s not ineptitude that caused this. Short term thinking and lack of prioritization did. Is it really that different than the mentality that led to VW’s emissions scandal or GM’s ignition switches inadvertently killing people? Hell, what about Wells Fargo’s cheating or Apple screwing iphone and macbook users?

      It’s all the same issue – save a penny. That mentality can be fatal, but customers appear to just keep coming back for more. We keep putting up with it, so it keeps happening.

  • avatar
    Hummer

    I don’t think this has any teeth at all, sure your helping those that were burned but what does it do for their resale value and all the cars over 60k miles? I mean a 2004 4 speed 200k mile Buick is going to feel like a step up compared to 70k mile DCT Focus.

    This doesn’t address the issue, I’m sure Ford saw this as VERY reasonable, frankly it appears it was made to their terms.

    I suppose the buyback could be helpful to the few that are still in these cars.

  • avatar
    dukeisduke

    I wonder what percentage of those have problems? I still see quite a few of the PowerShift-equipped Fiesta and Focus models on the road.

    • 0 avatar
      Middle-Aged (Ex-Miata) Man

      I’m curious about that as well. I caught an UberX 2015+ Focus hatchback last week and the transmission felt completely normal – if anything, it shifted much more smoothly than I expected. The car had a bit more than 64,000 miles on its odometer. I didn’t ask the driver if he’d had any prior transmission problems, though.

    • 0 avatar
      TMA1

      There are probably lots of people stuck in these things once they saw the resale value. “Why didn’t I pay 2 grand more for a Civic?”

      • 0 avatar
        indi500fan

        Yes the cost of customers gone for a lifetime is incredibly high. Especially if the alternative vehicles that are purchased after switching brands perform with decent reliability.

  • avatar
    tomLU86

    I just realized something.

    It was called the DPS6? “D*mn Piece of Sh*t 6” transmission. They swapped the P and S, but based on written accounts, not to mention the Detroit Free Press, an concise and accurate abbreviation.

    DSP6—the Vega of the 2010 decade.

    Thank you Alan!

  • avatar
    DenverMike

    For those analysts and other geniuses that still believe it’s a poor choice, dropping smaller sedans/hatches from the lineup, and or outsourcing, there you go.

    It’s not enough (for those cars) to be marginally or fairly profitable when you consider all the liabilities.

    Yet even Toyota (oh dear god) can’t go more than a few days without announcing another recall, some costing them billions involving millions of Toyotas, yes some even built in Japan with love.

    • 0 avatar
      TMA1

      Absolutely true. Car manufacturers should really consider getting into the used car business instead.

    • 0 avatar
      bkojote

      It’s not just cars, it’s that Ford, as a whole, tends to just make crap. Other manufacturers announce recalls, but Toyota catching faulty fuel pumps is a lot different than a half decade engineering a bad design and trying to cover it up.

      The Chinese Mustang transmissions that grenade themselves. The Edge/Flex’s 3.5L V6 that implodes once the impossible-to-replace water pump goes bad. The 5.4L F150 engines that sludged up at 40k. The new Explorer. This is the work of an institution that incentivizes a short term profit and kicking sh!t further downhill.

      • 0 avatar
        DenverMike

        Yeah cutting corners became a way of life at Ford, and it’s conceivable the entire lineup had to suffer.

        So if a company makes excellent money on hamburgers/fries/shakes and loses money on tacos/burritos that bring down the entire operation, why not simply drop the tacos/burritos?

        • 0 avatar
          TMA1

          Along comes mad cow disease, and people stop buying hamburgers for a few months. But yeah, if you’re tacos are killing people, stop selling them.

          • 0 avatar
            DenverMike

            It’s increasingly becoming a Royal pain to build new vehicles, with some 80K parts/assemblys/code/etc to get it wrong, lawyers licking their chops and whatnot.

            Or if it’s overbuilt you still lose. They’d better be crazy profitable.

        • 0 avatar
          Wheatridger

          I know nothing about other Fords, but give some credit to the unsung C-Max. The latest CR used car issue had all happy green circles for the last few years of production, including mine.

          • 0 avatar
            gtem

            Seriously eyeballing these for my next commuter while the 2016-2017 cars are still relatively fresh.

          • 0 avatar
            HotPotato

            Mine was first year of production. Very different story! So many recalls and TSBs, we never even got to all the repairs. I loved my C-Max but oof, Fords are now officially a lease-only vehicle for me.

  • avatar
    SCE to AUX

    That is a ridiculously low settlement estimate; it should have one or two zeroes added to it.

    • 0 avatar
      conundrum

      Quite agree. As it stands it’s 50 bucks each for owners. Even the ones who’ve had no problems will expect payola.

      I drove several Foci with these transmissions. A bit clonky, but the cars themselves were solid nice-handling and riding cars for the driver and front seat passenger. Back seat room was far too tight, though.

  • avatar
    ToolGuy

    So I can reasonably expect my modern vehicle to go 60,000 miles? (This seems low.)

  • avatar
    forward_look

    Mine runs OK cold,goes spastic hot. 74k. Probably solvable with software or tcm mod. But they won’t do it?!

  • avatar
    tankinbeans

    Was there still some residual cooperation with Mazda at the time this was designed? The Skyactive-drive seems like it would have worked.

    • 0 avatar
      HotPotato

      Skyactiv-drive strikes me as a brilliant idea in transmissions. The smooth start of a conventional auto; the sporty shifts and economy of a DCT. Really innovative thinking from Mazda.

  • avatar
    jkross22

    Always good to be reminded where Ford’s priorities are. Save a few bucks on a transmission or wait till we get sued? Let’s just get a few attorneys employed and call it a day.

    Ford, like GM, makes it very easy to not consider any of their products. This mentality seems to pervade most product decisions.

    A good reminder was the recent Explorer/Aviator botched launches. I guess 100 years of experience building cars isn’t enough.

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