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Chrysler Resolves NHTSA Request By Voluntarily Recalling 1.56 Mln Jeeps

Automaker Chrysler Group LLC, majority-owned by Italian carmaker Fiat SpA (FIATY), has finally agreed with the National Highway Traffic Safety Administration or NHTSA, and said Tuesday that it will conduct a voluntary safety recall of 1.56 million 1993-2004 Jeep Grand Cherokee and 2002-07 Jeep Liberty vehicles for supplemental improvement in low-speed crashes.

Chrysler said it is conducting the recall only as the matter has raised concerns for its customers. Meanwhile, the company confirmed that analysis of data confirms that these vehicles are not defective and are among the safest in the peer group.

Earlier, the automaker and the NHTSA had clashed, with Chrysler disagreeing with the NHTSA's request to recall 2.7 million Jeeps that the agency said are at risk of a fuel-tank fire in the event of a rear-impact collision.

Auburn Hills, Michigan-based Chrysler had then said the vehicles were not defective and their fuel systems do not pose an unreasonable risk to motor vehicle safety in rear-impact collisions. The refusal by an automaker to comply with the NHTSA's request for recall is seen as rare.

The NHTSA had opened an investigation into the vehicles in August 2010 at the request of the Center for Auto Safety, a Washington D.C.-based advocacy group. In its earlier letter to Chrysler, the agency cited 32 rear-impact collisions that caused fatal fires, resulting in 44 deaths in Jeep Grand Cherokees and another seven deaths in the Jeep Liberty.

Both, Chrysler and the NHTSA have now resolved their differences with respect to the recall requested by the NHTSA.

Chrysler said all 1.56 million vehicles will be inspected for issues with already installed trailer-hitch assembly or lack of one. Vehicles without the assembly will be fitted with one, while vehicles fitted with after-market trailer hitches will be inspected and replace if found inadequate.

The company also noted that vehicles with factory-installed and Mopar trailer-hitch assemblies will be inspected, but those are likely to require no further action.

Further, Chrysler will conduct a customer satisfaction action for the 1999-2004 Jeep Grand Cherokee and trailer hitches will be replaced where required. Meanwhile, the company has asked owners not need to bring in their vehicles for inspection if it doesn't have a trailer hitch, or if it has a factory-installed or Mopar trailer hitch.

The inspection and corrective steps will supplement the safety of its vehicles through an upgrade to the rear structure of the vehicles to better manage crash forces in low-speed impacts, the company said.

"Chrysler Group regards safety as a paramount concern and does not compromise on the safety of our customers and their families," the company noted.

In mid-May, Chrysler recalled about 469,000 Jeeps worldwide, including 295,345 units in the U.S., due to a gearshift problem that may result in an unintentional shifting of the transfer case into the neutral position.

Chrysler, which was once part of German automotive company Daimler AG, emerged from Chapter 11 reorganization in June 2009 and was bought by Fiat in a U.S. government-brokered deal.

FIATY closed Tuesday's regular trading session at $7.63, up $0.06 or 0.79% on a volume of 0.10 million shares.

by RTT Staff Writer

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