Bridgestone-Firestone case
Policy Analysis
Bridgestone-Firestone Tire Recall and its Aftermath
Introduction
This research paper tries to analyse the Firestone tire recall, the TREAD legislation and the Bridgestone-Firestone nonmarket and market strategy. The analysis will be started by introducing the company, its different stakeholders and the main issues will be outlined. Next, a more in depth analysis of the case will be given, using relevant concepts from class. The main points will be summarised in a conclusion.
Bridgestone/Firestone Inc., a subsidiary of Bridgestone Corporation, is formed in 1990 when Bridgestone U.S.A. merged with The Firestone Tire & Rubber Company. Bridgestone/Firestone is best known for it's production of tires, which account for more than 75 percent of its annual revenues. Sales of the company amount to $7.6 billion in 2002.
In August 2000, when problems with Firestone Tires and Ford Explorers led to about 270 deaths, Firestone had to recall 6.5 million tires. This recall had an impact on both market and non-market components.
The 4 I’s
Using the concept of ‘the 4 I’s’, I will frame the case and the different stakeholders. The main issues in this case are safety, liability, the recall and the TREAD act (The Transportation Recall Enhancement, Accountability and Documentation act). Interests include the tire company Firestone/Bridgestone (and in general the Rubber Manufacturers Association), Ford (as manufacturer of the SUV ‘explorer’) and consumers (represented by groups as Public Citizen and Strategic Safety). The institutions involved are the regulatory agency NHTSA (National Highway Traffic Safety Administration), the different courts, Congress and State legislators and the News media (nongovernmental). A last ‘I’ is Information. Information refers to what interest and institutional officeholders know about the issues, the consequences of alternative courses of action, and the preferences of those concerned with an issue. In this case information plays an important role. The (lack of) information of the consumers and the NHTSA, and later the obligation to give information is at the heart of this case.
Public Interest Theory vs. Pluralist Theories
An interesting approach to understanding political activity in is to look at the Public Interest Theory vs. Pluralist Theories. There is not much evidence to be found that political action in this case (the TREAD act) is a result of serving the public interest in an independent way, applying a set of normative principles. On the contrary, the industry and the public interest groups worked together with the NHTSA. “Mr. Shea said, the industry was able to work with Congress to obtain the fairest, least onerous bill it could under the circumstances.” (Moore). Not only the tire industry, but also the public interest groups had a stake in the new legislation (Power). “…and we have been working with them as we have been working with other elements of the motor vehicle industry in terms of developing a rule that is not overly burdensome and yet will provide good data to us, said Kenneth Weinstein, NHTSA associate administrator for enforcement.” (Moore). These extracts indicate that this new regulation is a result of [next page]