Will SA banks finance a Ford Kuga?

South Africa’s banks are grappling with how to deal with Ford’s burning Kuga issue.

One bank has confirmed that it requires guarantees from the global car manufacturer when processing finance purchasing applications for the vehicle.

TimesLIVE has learnt of at least one WesBank client who was told that‚ before the finances for sale of his vehicle would be approved‚ he required a guarantee from Ford that a replacement part fitted to the car was safe‚ although the bank says this is not its official policy.

Ford says that the Kugas destroyed in fires on South Africa’s roads since December 2015‚ when Reshall Jimmy burnt to death in his 1.6l 2014 Kuga‚ caught fire because of a faulty coolant system.

Last week‚ Ford issued a safety recall for 4 556 Kugas built between 2012 and 2014 to replace the system with a more robust one.

The company‚ however‚ maintains that the fire which killed Jimmy while he was on holiday in the Wilderness‚ in the Western Cape‚ is unrelated to the other fires and started at the rear of the car. It is‚ however‚ unable to explain what caused that fire.

At least 50 other Kugas are reported to have caught alight since then.

Police investigating Jimmy’s death‚ along with private forensic and fire investigators‚ believe the fire was caused by an electrical fault behind the dashboard on the passenger side of the vehicle.

Several Kuga owners‚ whose vehicles are not 1.6l models‚ have said their vehicle fires were also caused by electrical faults.

‘BANK WANTED A GUARANTEE FROM FORD’

Renaldo Vilonel‚ who is selling his 1.6l Kuga because he is emigrating‚ said he bought his car six months ago.

“Because my work transfer is an opportunity of a lifetime‚ I decided to sell my car.”

Shocked at the price he was offered from the Somerset West Ford dealership‚ he decided to sell his car privately.

“It was only then that I learnt of Jimmy’s death and the other fires. I thought I would have problems trying to sell it‚ but I eventually found a buyer.”

Vilonel’s joy was short-lived when he was told that‚ for the finance from WesBank to be approved‚ he would have to provide guarantees from Ford on the parts that needed to be replaced.

“I was told that I needed to get a roadworthy certificate and technical inspection report‚ which wasn’t the problem. The problem was that for the sale to be signed off‚ the bank needed a certificate from Ford guaranteeing the repairs and replacement parts and that the car’s electrical system must also be checked out and given the OK.”

He said that when he asked why he was told that it was because of the vehicle being a fire hazard.

When Vilonel returned to the dealership for the guarantee‚ he was told it could only provide him with a letter stating that the repairs would be done.

“They said that was the best they could do as there was a back order on the replacement parts. They couldn’t tell me when the repairs would be done.”

Vilonel said that when he approached Ford SA‚ they refused to help him.

“When I demanded that they provide me with the certificate‚ the person I was dealing with at their head office hung up the phone.”

He said the deal was now hanging in the balance.

“I am emigrating and the car has to be sold‚ but I can’t sell it until it’s been fixed and I don’t know when it will be.’

Vilonel said that when he told WesBank he could provide a letter from the Ford dealership saying the repairs would be done‚ the bank was apprehensive.

“I asked the dealership if they could finance the car deal or at facilitate it‚ but they said Ford SA had told them they can’t.”

HOW WESBANK RESPONDED:

WesBank’s spokesman Rudolph Mahoney said‚ with Vilonel’s case‚ it was a matter of the bank’s customer call centre staff looking after the buyer’s interests as they are aware of the reported issues with the Kuga.

“This is not a show-stopper and will not result in the deal not going through if it has been approved through normal credit check procedures.”

He said that when a person bought a car privately there was a lot of risk for both the buyer and the seller‚ including that there are no warranties against dud vehicles.

“We have established a layer of checks and balances in the finance processes for such private sales‚ including the seller obtaining roadworthy and technical inspection reports to rule out faults with the vehicle. If there are issues‚ the seller has to fix them before the sale is concluded.”

Mahoney said the bank didn’t discriminate against the sale of Kugas by requiring additional guarantees.

WHAT THE OTHER BANKS ARE DOING:

ABSA Absa spokesman‚ Lies Squire said‚ as part of the recall‚ Ford was to provide each customer with a letter confirming that these vehicles had undergone the necessary repairs and a guarantee on the parts replaced.

“On receiving a request to finance a Ford Kuga‚ and the model fits within the range of recall‚ we will require a safety certificate ensuring that the safety recall has been remediated.

“This will be sufficient for Absa to enter into an agreement to finance an affected Ford Kuga in future‚ specifically Ford Kuga 1.6 models manufactured between 2012 and 2014.”

She said consumers with these models needed to take advantage of the recall remediation to ensure that their financed cars had been repaired.

STANDARD BANK Standard Bank spokesman Ross Linstrom said his bank did not require a guarantee.

“Ford has committed to fixing all the affected models. We finance all used cars within the existing policies and risk appetite. These also determine up to what amount we finance a car and over what term. Ford Kugas also fall within such policies and risk appetite.”

NEDBANK Asked if Nedbank required a guarantee from Ford‚ spokesman Tobeka Lwana said the bank would prefer not to comment.

– TMG Digital/TimesLIVE