Ford agrees to drop 'secret warranties'

The Ford Motor Company agreed Thursday to stop using undisclosed warranties and to notify consumers when major engine and transmission problems develop. Ford also said it will explain the new policy in advertisements in national magazines, and will make technical service manuals available to car owners.

"For the first time, consumers will have low-cost, systematic access to high-quality repair information," a Federal Trade Commission spokesman said.

Thursday's agreement stems from an FTC complaint that 6 million Fords produced between 1974 and 1977 had engine defects which the company would repair only if the consumer complained about it. They were covered by so-called "secret warranties."

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