Court tells Navistar, Ford to make peace

CHICAGO — A judge has dismissed a lawsuit by Navistar International Corp. against Ford, and ordered the two companies to settle their longstanding dispute over the supply of Navistar diesel engines for Ford F-series trucks.

According to Bloomberg, the two companies were urged to enter mediation to resolve their dispute before the judge hears Navistar’s suit.

Navistar filed the lawsuit in June, alleging that Ford was developing its own diesel engine for its F-Series pickups and possibly other vehicles.

According to the lawsuit, Ford is developing a 4.4-liter diesel engine for production in North America by late 2009 or 2010 or possibly earlier.

Navistar has been supplying engines for Super Duty trucks since 1979, and its contract with Ford runs through 2012.??Earlier this year, Ford filed a lawsuit against Navistar involving 2007 engine pricing and prior period warranty claims on Power Stroke diesel engines.

Navistar counter-sued, stating that pricing is consistent with contractual agreements.

— with files from Bloomberg News

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