Core Viewpoint - Ford Motor Company is facing a class action lawsuit due to alleged breaches of fiduciary duties by its board of directors, particularly concerning undisclosed quality issues and rising warranty costs that have negatively impacted profitability [1][4]. Financial Performance - On July 24, 2024, Ford reported second quarter financial results, indicating that profitability was adversely affected by increased warranty reserves and higher warranty costs [2]. - Warranty and recall costs for the second quarter totaled $2.3 billion, which is $800 million higher than the first quarter and $700 million more than the same period last year [2]. Stock Market Reaction - Following the announcement of the financial results, Ford's share price dropped by $2.51, or 18.36%, closing at $11.16 per share on July 25, 2024, with unusually high trading volume [3]. Allegations in Class Action - The class action complaint alleges that Ford's management made materially false or misleading statements and failed to disclose significant adverse facts about the company's operations and prospects, including: 1. Deficiencies in quality assurance of vehicle models since 2022 [4]. 2. Higher warranty costs resulting from these deficiencies [4]. 3. Inaccurate warranty reserves that did not reflect the quality issues in vehicles sold since 2022 [4]. 4. Likely suffering of profitability due to these issues [4]. 5. Misleading positive statements regarding the company's business and operations [4].
FORD ALERT: Bragar Eagel & Squire, P.C. is Investigating Ford Motor Company on Behalf of Long-Term Stockholders and Encourages Investors to Contact the Firm