Ford is not having the greatest year so far. The recent announcement of the company’s year-end earnings was a disappointment to both Wall Street and company CEO Jim Hackett, who reportedly fired off a nasty email to workers detailing just how angry he was.
Now, Automotive News and Bloomberg have reported that Ford has found itself in a scuffle with professors from the renowned Massachusetts Institute of Technology (MIT) over technology that’s being used in the F-150.
Automotive News says Ford is being sued by MIT researchers over stolen technologies being put to use in the F-150’s EcoBoost engine, among other Ford products.
MIT and Ford weren’t always on unfriendly terms. In 2007, the two groups formed a partnership to focus on powertrain, fuel, and energy technologies. The company’s chairman, Bill Ford, even has a master's degree from MIT’s business school.
So what went wrong? Three MIT professors say they’ve worked for years to perfect the technology in play — a dual-injection approach that allows “for better fuel-and-air mixing and combustion stability than direct injection, with less engine knock.” Once perfected, the professors transferred ownership of the tech to MIT, which then gave the three inventors exclusive rights to sells licenses under the small company they’d formed called Ethanol Boosting Systems LLC, or EBS.
After the researchers offered Ford an exclusive first crack at licensing the technology, a complicated back-and-forth ensued, which resulted in Ford saying in 2015 that it had no interest in licensing the patents and had no plans to use the technology in future vehicles.
But EBS is saying that’s clearly untrue if you look at the technology in use in the EcoBoost, and that, even though Ford said it had no plans to use the technology, it was already being integrated into its vehicles. Ford even highlighted its dual port- and direct-injection technology in a 2017 press release.
Ford has sold a ton of engines with EcoBoost, since it’s featured on most of its highly popular trucks. And while neither EBS nor Ford would provide Automotive News a comment on the suit, analysts speculate that the dollar amount tied to any potential royalties in this case could mean Ford takes a big hit. According to Kevin Tynan, senior automotive analyst for Bloomberg Intelligence, if you take the 8 million light trucks the company has sold in the last three years, a dollar royalty for each would be a drop in the bucket. But $1,000? That’s $8 billion which, incidentally, is a billion dollars more than Ford’s profits for all of 2018.
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