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Ford Will Pay $610 Million to Recall 3 Million Vehicles for Airbags

Ford announces a recall of 3 million vehicles in the U.S. and Canada to replace faulty Takata airbags.
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Ford Motor  (F) - Get Ford Motor Company Report announced a recall of 3 million vehicles in the U.S. and Canada to replace faulty Takata airbags at a cost of $610 million.

Ford shares traded at $11.36, down 1.43%, in premarket trading Friday. That interrupted their 29% surge in the month through Thursday resulting from investor excitement for the company’s electric car efforts.

The stock decline Friday came despite an upgrade from J.P. Morgan analyst Ryan Brinkman to overweight from neutral with a $14 share-price target.

As for the recall impact, “the company is reporting the expense as a special item in its fourth-quarter results, which won’t affect its adjusted earnings,” Ford revealed in a regulatory filing. The recalled vehicles are from model years 2006 through 2012 and include some of Ford’s best-sellers of that era, such as the Fusion sedan, Edge sport-utility vehicle and Ranger pickup.

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The recalls come after a petition Ford filed with the National Highway Transportation Authority for exemption from recalls was rejected earlier this week.

Also in the Securities and Exchange Commission filing, Ford said it expects to record a pretax remeasurement loss in its fourth-quarter 2020 results of $1.5 billion related to its pension and other post-retirement employee benefits.

Ford shares surged to the highest in more than two years Thursday after TheStreet's Jim Cramer highlighted the electric vehicle investment push from the new administration of President Joe Biden.

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