Ford to pay $365 million in US import tariff evasion case

WASHINGTON — Ford Motor will pay $365 million to resolve US allegations it violated a federal tariff law by misclassifying and understating the value of hundreds of thousands of its Transit Connect vehicles.

The Department of Justice (DoJ) said the settlement resolves allegations that Ford devised a scheme to avoid higher duties by misclassifying cargo vans imported from Turkey from April 2009 to March 2013.

The government said the settlement is one of the largest customs penalty settlements in recent history.

“Ford strongly disagrees with many of the characterizations in the DoJ’s statement and admits no liability in this matter,” a Ford spokesperson said. “But in the interest of moving on from this complex, decade-old dispute, we have agreed to settle the matter once and for all.”

Customs and Border Protection ruled in 2013 that Transit Connects imported as passenger wagons and later converted into cargo vans were subject to the 25% duty applicable to cargo vehicles, rather than the 2.5% passenger vehicle duty.

The Justice Department said Ford imported the vehicles “with sham rear seats and other temporary features to make the vans appear to be passenger vehicles. These temporary rear seats were never intended to be, and never were, used to carry passengers.”

Ford included these seats and features to avoid paying the 25% duty rate, the government said.

After Customs clearance, the Transit Connect vehicles were immediately stripped of rear seats and returned to its original identity as a two-seat cargo van. —