Ford, Chrysler Accused of Misleading Consumers to Think Cars Are U.S.-Made

Made in the USA Files Complaints With FTC Saying Some Models Advertised as American Are Actually From Canada

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DETROIT (AUTONEWS.COM) -- Ford Motor Co. and Chrysler Group are accused of misleading advertising in complaints filed with the Federal Trade Commission by the Made in the USA Foundation.

The California-based group claims the automakers are using misleading ads to market certain vehicles as made in the United States when they are not.

"We're not happy about Ford making cars in Canada and Mexico but we're unhappier about them misleading customers," said Joel Joseph, the organization's chairman. "Especially with Chrysler, who was bailed out with taxpayer money."

The Made in the USA Foundation was created in 1989 to promote American-made products. Initial funding was provided by Ford Motor Co. and the UAW, but the foundation said Monday it will "object when Ford violates the law."

The foundation said it filed a complaint against Chrysler for its TV and print ads for the Chrysler 300, in which the automaker uses the tagline "Imported From Detroit."

The Chrysler 300 sedan is assembled in Brampton, Ontario, and often includes a Mexican-made engine, according to the foundation.

Mr. Joseph said Chrysler is "flat wrong" to imply the Chrysler 300 is made in the United States and is asking the FTC to order "corrective advertising."

The complaint is without merit, Chrysler says.

"Chrysler Group will continue to pursue all avenues to protect our 'Imported From Detroit,'" Michael Palese, manager of legal communications for the company, said in a statement.

Chrysler launched the Imported from Detroit campaign with a commercial during the 2011 Super Bowl telecast. The ad featured rapper Eminem and the new 2012 Chrysler 200, a mid-sized sedan assembled in suburban Detroit.

Ford also faces a complaint from the foundation because of a radio ad for the Ford Edge crossover. The foundation says Ford claims the Edge is an American car in the radio spots, but that it is made in Canada, according to the group's complaint.

"The Ford ad misleads and confuses the public and we have asked the Federal Trade Commission to stop the ads," the foundation said in a press release.

A Ford spokesman said the automaker did not create the ad in question.

"The radio advertisement being discussed was made by a dealer, who is responsible for the content," spokesman Paul Harrison said in an email to Automotive News.

The email statement did not provide the name of the dealer.

Mr. Joseph said the radio ad regarding the Ford Edge was heard in Los Angeles and was not dealer-specific, despite Ford's position.

As part of Ford's tentative labor settlement with the UAW this month, Ford will add a second North American production source for the Fusion in Michigan, the union says.

In addition to the individual complaints, the foundation alleges both automakers have stripped country-of -origin information off the 300 and Fusion, as well as other vehicles, at recent auto shows in New York, Washington, Detroit and Los Angeles.

"Chrysler and Ford are intentionally misleading consumers by implying all of their vehicles are made in the U.S.A., where they are not," Mr. Joseph said. "To add to their wrongdoing, Chrysler and Ford have removed country-of -origin labels from their car windows at auto shows where millions of consumers get their first look at many new cars."

The sticker removal is a violation of the American Automobile Labeling Act, Mr. Joseph said. Though the complaint notes that "many" Chrysler and Ford dealers also remove the stickers, he declined to name any in specific.

"It's not all dealers," he said. "I'm not going to pick on any particular ones. It was from coast to coast. We have a lot of members that said they walked into a dealer and they didn't have country of origin stickers."

Chrysler denied the allegation.

"Chrysler Group fully complies with the American Automobile Labeling Act," Mr. Palese said. "Neither the act nor the regulations respecting it contain any provision that requires labeling on vehicles that are on display at auto shows. The statue requires only that a label be affixed to a vehicle distributed for sale."

The foundation has no basis on which to assert a claim against Chrysler under the act, the automaker added.

"A suit on the grounds claimed would be specious and subject to sanctions under the Federal Rules of Civil Procedure," Mr. Palese said.

The FTC must now agree to carry out an investigation into the matter or else send a formal complaint to the automakers requesting corrective advertising.

"If they want to investigate, they'll investigate," Mr. Joseph said. "Ninety percent [of investigations] result in a consent decree where they agree not to run the ad again or something like that ."

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