Ford Initiates Major Recall Over Steering Control Risk in Explorer SUVs

Feb 26, 2026 (17 hr ago)
Neutral
Ford Initiates Major Recall Over Steering Control Risk in Explorer SUVs
Ford is recalling over 412,000 Explorer SUVs due to a rear suspension component failure that risks steering control loss.

Critical Explorer Suspension Recall

  • Ford is recalling 412,774 Explorer SUVs (2017–2019 models) due to rear toe link fracture risk, potentially causing steering control loss3, 7
  • Dealers are instructed to replace the faulty rear suspension components at no cost to owners, with repairs expected to begin in early March7

Broader Quality and Recall Context

  • This action contributes to a challenging quality record, as Ford issued over 100 recalls last year, the highest volume among U.S. automakers3
  • The company is also addressing separate issues, including recalls related to battery problems and brake pedal defects3

Strategic Margin Management and Investment Pivot

  • Ford is moderating investment pace in the Model e division while increasing capital allocation toward Ford Blue, focusing on hybrids and higher-margin products2
  • The company aims to achieve its long-term goal of an 8% adjusted EBIT margin by 2029, despite Q1 2026 EBIT margin guidance remaining flat sequentially at 2.3%2

Growth in Software Monetization

  • Ford Pro is seeing significant traction in recurring revenue, with paid software subscriptions growing 30% in 20255
  • Total paid subscriptions (software and physical services) surpassed 1.3 million, contributing 19% of Ford Pro’s EBIT, where software gross margins exceed 50%5

Financial Outlook and Operational Stabilization

  • The Zacks Consensus Estimate for 2026 sales implies modest year-over-year growth of 0.6%, while 2026 and 2027 EPS estimates have recently seen slight upward revisions1, 2
  • The company anticipates production volumes stabilizing and aluminum costs normalizing in the second half of the year, leading to a return to underlying EBIT run-rate levels2

Future Product Lineup Adjustments

  • Ford confirmed plans to launch another combustion-powered utility vehicle later this decade alongside its push for affordable EVs and hybrids6
  • The company is also targeting the deployment of Level 3 'eyes-off' driving capabilities starting in 20286
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Ford Initiates Major Recall Over Steering Control Risk in Explorer SUVs | Foxly Invest