FTS to initiate recall - until funds run out

Washington -- Foreign Tire Sales Inc. will give the US-based National Highway Traffic Safety Administration (NHTSA) a revised defect report by 2 July outlining a plan to recall at least some of the 450 000 Chinese radial light truck tyres the Union, New Jersey-based company imported into the US

NHTSA told FTS in a 26 June letter that it expected a recall plan by that date, warning the importer that it faced action for injunctive relief and fines as high as $16.4 million (€12 million) if it did not follow through with a recall.

FTS estimates the cost of the recall at $50 million-$80 million and believes it has sufficient assets to recall maybe 10 to 15 percent of the total, according to Lawrence Lavigne, the company's attorney.

Hangzhou Zhongce Rubber Co. Ltd., manufacturer of the recalled tyres, hasn't cooperated with FTS, so the company is trying to negotiate with another supplier for replacement tyres, he said.

From Tire Business (A Crain publication)