Home » The Latest News » Navistar to recall brake units, take charge

Navistar to recall brake units, take charge

Oct 1, 2002 12:00 PM

Truck maker Navistar International Corp. said today it may recall up to 90,000 hydraulic anti-lock brake system electronic control units in the United States and Canada, which would result in a fourth-quarter charge.

Navistar's International Truck and Engine Corp. unit notified the National Highway Traffic Safety Administration on Tuesday of the voluntary safety recall, Navistar said in a filing made with the Securities and Exchange Commission.

"To date, no injuries have been reported as a result of this issue," Navistar said in the SEC filing.

The company said because of the recall it expects to record a fourth-quarter pretax charge of $51 million, which will be spread out over the next three years and through fiscal 2005.

As a result of the recall, Navistar said it has revised its fourth-quarter forecast to a loss of 72 cents to 77 cents per share from continuing operations.

In August, Navistar said it could show a loss of 20 to 25 cents a share from continuing operations in the fourth quarter. The company said it plans to pursue a recovery of the costs associated with the recall of the units, which were manufactured by a third party.

"Notice to owners will be sent and the recall will commence promptly after NHTSA approval," Navistar said in the SEC filing.

Navistar stock was down $1.13, or 5.2 percent, at $20.55 in early morning trading on the New York Stock Exchange.

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