Jeep succumbs to recall pressure
Chrysler has backed down after initially fighting a recall request from US regulators in a dispute over crash protection for the fuel tanks of 2.7 million older Jeep models.
The recall will affect Jeep Grand Cherokee SUVs from model years 1993 to 2004 and Jeep Liberty (badged Cherokee in SA) SUVs from 2002 to 2007.
Our contact at Chrysler South Africa said the local division is currently awaiting feedback from overseas and will likely make an announcement later this week on how South Africa is affected.
Regulators from the National Highway Traffic Safety Administration said the agency would continue to investigate the issue, including a review of new documents provided by Chrysler. NHTSA officials said they were pleased with Chrysler's decision.
While Chrysler stood by its assertion that the vehicles were not defective, it acknowledged consumer concerns about the safety of the vehicles, which have fuel tanks situated behind the rear axle.
Chrysler said its dealers would install trailer hitches on affected vehicles that did not already have factory-installed hitches.
It said: “Chrysler's analysis of the data confirms that these vehicles are not defective and are among the safest in the peer group.”
On 3 June the National Highway Traffic Safety Administration on June 3 asked Chrysler to recall the two Jeep models because the placement of the fuel tank leaves them less protected in the event of rear-end crash and could lead to a leak and fire.
The safety agency's data shows that 51 people have been killed in rear-end crashes involving the two Jeep models affected - but Chrysler has said the NHTSA's investigation was flawed, and that fuel leaks and fires were extremely rare.
A company spokesman declined to estimate the cost of the recall.
Industry consultant Sandy Munro said a conservative estimate of the recall's cost would be $300 million (R3 billion).
Chrysler's net income for the first quarter was $166 million (R1.66 billion).
Analyst Alec Gutierrez said consumers had recently been forgiving of automakers who complied with recalls.
“This outcome will not only help consumers,” he said, “but also Chrysler, as there was also danger that sales could decline if they had refused the recall.”
Resisting a recall requested by federal regulators is rare in the US auto industry.
The last time Chrysler fought a recall request for one of its vehicles was in 1997.
Munro said that Chrysler was being forced to “fix something that doesn't need to be fixed” and said the incidence of problems for the Jeep models was low considering the huge distances they had been driven.
Chrysler had earlier pointed out that the Grand Cherokee and Liberty SUVs met safety requirements in effect at the time of their manufacture. - Reuters