Firestone's dilemma: Can this brand be saved?

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Firestone was able to recover once from a massive recall. But as the firestorm over the latest controversy grows -- along with the number of deaths attributed to the tires -- concerns are being voiced about whether the brand can be saved.

Ford Motor Co.'s image has also been tarnished since its Ford Explorer was involved in many of the fatal accidents involving Firestone tires. But marketing experts say Ford's quick, somber reaction should translate into a quicker rebound in consumer confidence.

Not that the crisis is even close to being over. Eighty-eight deaths have been attributed to the recalled tires so far, Ford and Bridgestone/Firestone face potential criminal charges in Venezuela and the storm has been growing uglier each day.


The slow, awkward reaction of Bridgestone/Firestone's Japanese parent, Bridgestone Corp., has worsened the public relations damage, according to industry observers.

"Firestone is fighting this all the way," said Wes Brown, an analyst at market researcher Nextrend. "Short term, the negative baggage on the Firestone brand is too great and there's a strong argument to instead sell only the Bridgestone brand in this country. . . . It's looking more like the Firestone brand is going to have a tough time surviving in the next few years."

James Bulcroft, a former automotive advertising executive who's now president of consultancy Advisory Group, said, "Japanese management is a bit naive about things like this. I don't think Firestone understands what's happening here; Ford understands what's happening."

Leon Brodeur, who retired as Firestone vice chairman in 1986, said U.S. consumers are more litigious now than they were at the time of the 1978 recall, which will only prolong the situation. "The problem is now when you get a recall, anything that happens to a tire, people are going to say it's defective," he said.


Bridgestone/Firestone's best bet, said Gerald Kerr, who oversaw advertising for Firestone during that earlier recall, is to quickly replace defective tires and then run ads that play up the company's 100-year heritage.

That's the basic approach taken in 1978 when Firestone's agency at the time, Murray & Chaney, Hudson, Ohio, signed actor Jimmy Stewart to appear in eight TV commercials touting the brand's history. The spots, the actor's first-ever product endorsement, ran for about three years.

"Jimmy Stewart brought a lot of credibility to the brand and reminded people it had been around since 1900," said Mr. Kerr, now chairman of Bates Southwest, Houston. "Time healed a lot of wounds."

Bridgestone/Firestone originally wanted to conduct the latest recall in phases, with completion due in spring 2001. But the marketer announced Aug. 22 it would fly tires in from its plants in Japan to hurry along the replacements. That was a day after Ford announced it would shutter three plants to "harvest" tires for the recall.

Bridgestone/Firestone's first ad hit 41 major newspapers Aug. 16, a week after the recall was announced. The company later ran a second newspaper ad; it aired a TV commercial just four times on Aug. 26 and Aug. 29, during broadcasts of the "NEC World Series of Golf."

A spokeswoman for Firestone said she didn't know about future ad plans and didn't call back with information about which agency handled the public education campaign. Grey Worldwide, New York, is the brand's agency.

Ford, by comparison, ran its first newspaper ad Aug. 11, just two days after the recall. The carmaker has also aired two TV commercials, each for a week, with CEO Jacques Nasser updating viewers on the recall. A spokeswoman said consumer reaction to the ads was positive in focus groups.

Mr. Bulcroft said Firestone could survive as a brand if it drops the names of the three recalled models, the ATX, ATX II and Wilderness AT. But, he cautioned, the brand's survival will be in jeopardy if daily negative news continues or if lawyers dig up damaging information.

Firestone and Ford have a long relationship that dates back to 1906, when Henry Ford and Harvey Firestone camped together. Tire heiress Martha Firestone is the mother of William Ford Jr., the automaker's chairman.


Mr. Bulcroft said it will be interesting to see how long the two companies will present a united front on the recall. As the crisis wears on, Ford seems more willing to point fingers at Firestone. A split in ranks would play into the hands of plaintiff lawyers, Mr. Bulcroft said.

After the first recall, Firestone lost $400 million from 1977 to 1979, with its short-term debt skyrocketing to $360 million, according to Rubber & Tire News. Mr. Brodeur said Firestone closed six plants by 1981. "It took probably four or five years to bring back the brand name," he said.

Bridgestone invested heavily in the brand and its U.S. plants after acquiring Firestone in 1988. Still, Bridgestone/Firestone's net loss grew from $52.9 million in 1989 to $492.9 million in 1991, according to Rubber & Tire News. It turned a small profit in 1993, and profit grew steadily from then to hit a record $285 million in fiscal 1998.

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