DETROIT MI Chrysler Group LLC avoided its name being dragged through the mud potentially for years by agreeing to a deal with the National Highway Traffic Safety Administration to recall some older Jeep models due to fire risks according to analysts.
Chrysler obviously calculated the risks and benefits and concluded that the cost to repair these vehicles isn't as expensive as the potential long term damage that could come from bad PR said Edmunds.com senior analyst Michelle Krebs. This was probably the right decision by Chrysler.
The Auburn Hills based automaker Tuesday afternoon said that it agreed to voluntarily recall 1.56 million 1993 2004 Jeep Grand Cherokee and 2002 07 Jeep Liberty vehicles and conduct a customer satisfaction action for 1.14 million 1999 2004 Jeep Grand Cherokee.
NHTSA originally requested Chrysler recall all of the 2.7 million Jeep SUVs due to a risk of a fuel tank fire in a rear end collision.
A NHTSA investigation found 51 deaths in 37 rear end collisions in the vehicles due to the placement of the fuel tank being located behind solid rear axles. The placement of the tanks behind the rear axle and their height above the road is a design defect according to NHTSA. Such failure can result in fuel leakage which in the presence of external ignition sources can result in a fire.This March 6 2012 photo provided by the law offices of Butler Wooten Fryhofer LLP shows the scene of a crash in Bainbridge Ga. where a 4 year old boy named Remi Walden was burned and died when a Jeep Grand Cherokee was struck from the rear by a Dodge Dakota pickup truck.AP File Photo
Even though it is fixing the vehicles Chrysler as it previously did still contends the vehicles are not defective and are among the safest in the peer group.
Nonetheless Chrysler Group recognizes that this matter has raised concerns for its customers and wants to take further steps in coordination with NHTSA to provide additional measures to supplement the safety of its vehicles Chrysler said in a statement Tuesday afternoon.
The additional measures involve adding a trailer hitch assembly to the vehicles to better protect the gas tank.
For the 1.56 million Grand Cherokees and Libertys involved in the voluntary recall Chrysler dealers will install a Mopar trailer hitch to the vehicles without any trailer hitch or non Mopar or factory trailer hitches.
The fix for the 1.14 million Grand Cherokees part of the customer service (or satisfaction depending on the statement) action gets a little more complex. If vehicles do not have a hitch no action is necessary. If the vehicle does have one customers will be asked to bring in the vehicle so the type and condition of the hitch can be inspected and replaced if necessary.
Chrysler said the cost to fix the vehicles is still undetermined because it's unknown how many trailer hitches will have to be installed.
NHTSA originally sent Chrysler a letter dated June 3 asking the company to voluntarily recall 2.7 million Grand Cherokees from 1993 through 2004 and Jeep Liberty models from 2002 through 2007 due to a risk of a fuel tank fire in a rear end collision.FILE In this file photo taken Fed. 2 2001 rows of 2001 Jeep Grand Cherokees are lined up outside the Jefferson North Assembly Plant in Detroit. (AP Photo/Carlos Osorio File) AP File Photo
On June 4 Chrysler issued a statement and three page white paper report supporting its decision not to voluntarily recall the vehicles saying the company does not agree with NHTSA s conclusions and does not intend to recall the vehicles cited in the investigation.
Jared Rowe president of Kelley Blue Book said although Chrysler still contends there is nothing wrong with the vehicles the voluntary recall shows they want customers to feel safe in the vehicles.
Chrysler has been gradually improving market share since 2009 because of the improvements they have made to their product lineup and their stance could only help to improve their brand image and sales he said.
Chrysler has recorded 38 consecutive months of year over year sales gains and record profits since it emerged from a federally backed bankruptcy in 2009.
Analysts previously told MLive Autos that if Chrysler didn't back down from its stance it could have meant months if not years of harmful litigation for the automaker.
NHTSA opened an investigation into the Jeeps in August 2010 at the request of the Center for Auto Safety a Washington D.C. According to the organization's website it sent numerous letters to Chrysler regarding the fires.
According to the Associated Press NHTSA said in a statement that it's pleased with Chrysler's decision. The agency plans to keep investigating the issue as it reviews recall documentation from Chrysler.
Alec Gutierrez senior analyst at Kelley Blue Book said the voluntary recall and customer service action shouldn t have a lasting impact on Chrysler compared to a battle with the government.
This outcome will not only help consumers but also Chrysler as there was also danger that sales could decline if they had refused the recall he said. Consumers have been forgiving when manufacturers have chosen to comply with NHTSA requests in recent years and now that Chrysler has softened their stance they should escape any negative impact to their brand.
Edmunds.com reports there were 659 recalls issued by NHTSA last year and none of them appeared to have had a lasting negative impact on any brand.
Chrysler said notifications to potentially impacted customers should be out within 30 days. Shortly after the notifications are sent out customers may then take the vehicle into the dealership for an inspection.
Chrysler Group regards safety as a paramount concern and does not compromise on the safety of our customers and their families said Chrysler Senior Vice President of Corporate Communications Gualberto Ranieri in a follow up statement to the automaker s original release Tuesday afternoon.
Customers who have questions or concerns can call the Chrysler's customer care line 1 800 334 9200.
Click here for all of MLive Autos' coverage on the Jeep NHTSA controversy.