Chrysler refuses U.S. request to recall Jeeps

June 4, 2013

A defiant Chrysler is refusing to recall about 2.7 million Jeeps that the government says are at risk of a fuel tank fire in a rear-end collision.

The National Highway Traffic Safety Administration (NHTSA) sent Chrysler a letter asking that the company voluntarily recall Jeep Grand Cherokees from 1993 through 2004 and Jeep Libertys from 2002 through 2007.

Chrysler Group, which is majority-owned by Italy’s Fiat, said in a statement Tuesday that the Jeeps are safe and that it “does not intend to recall the vehicles.”

Such a refusal by an auto company is rare. The NHTSA can order a recall but needs a court order to enforce it.

David Strickland, the agency’s administrator, said in a statement that he hopes Chrysler will reconsider its decision. “Our data shows that these vehicles may contain a defect that presents an unreasonable risk to safety,” Strickland said.

The NHTSA opened an investigation into the Jeeps in August 2010 at the request of the Center for Auto Safety, a Washington advocacy group. Clarence Ditlow, the center’s director, has repeatedly sent letters to Chrysler seeking a recall.

The agency found that the Jeeps’ fuel tanks can fail when hit from the rear, leak fuel and cause fires if there’s an ignition source. The placement of the tanks behind the rear axle and their height above the road are design defects, the NHTSA wrote in a letter to Chrysler dated Monday.

Chrysler moved the fuel tanks on the Grand Cherokee ahead of the rear axle in 2005 and did the same thing with the Liberty in 2007. But retrofitting the older Jeeps with repositioned tanks would be time consuming and costly. In 2011, when Toyota recalled 1.7 million cars for possible fuel leaks from loose fuel pressure sensors, an analyst estimated the cost at $240 million.

Automakers usually agree to a recall request, partly to avoid bad publicity. In the past three years, Chrysler has conducted 52 recalls.

The company previously refused a request by the NHTSA in 1996, when the agency asked it to recall 91,000 Dodge Stratus and Chrysler Cirrus cars for an alleged seat belt defect. The NHTSA sued the company and won in federal court. But in 1998, an appeals court reversed the decision, saying the NHTSA had unfairly held Chrysler to a new standard.

Chrysler was represented in that case by John G. Roberts Jr., now chief justice of the United States.

Chrysler said its review of nearly 30 years of data shows a low number of rear-impact crashes involving fire or a fuel leak in the affected Jeeps. “The rate is similar to comparable vehicles produced and sold during the time in question,” the company said in the statement.

But the NHTSA said the older Jeeps performed poorly when compared with all but one similar vehicle from the 1993 to 2007 model years, “particularly in terms of fatalities, fires without fatalities, and fuel leaks in rear-end impacts and crashes.”

The NHTSA found at least 32 rear-impact crashes and fires in Grand Cherokees that caused 44 deaths. It also found at least five rear crashes in Libertys, causing seven deaths. The agency calculated that the older Grand Cherokees and Libertys have fatal crash rates that are about double those of similar vehicles.

The dispute leaves Chrysler open to the risk of big liability if there are more crashes and injuries linked to the fuel tanks, said Logan Robinson, a University of Detroit Mercy School of Law professor and former Chrysler corporate counsel. Lawyers could argue that if Chrysler had recalled the Jeeps, people wouldn’t have been hurt, he said. But that liability would be limited if Chrysler beats the NHTSA in court and a judge rules the company didn’t sell defective vehicles, Robinson said.

Chrysler has until June 18 to respond to the letter. If it formally decides against a recall, the company must explain the action to the NHTSA, and the agency can then issue a final decision that the Jeeps are defective.

The NHTSA has the authority to fine companies if they are slow to provide data or recall vehicles. The agency fined Toyota a record $66 million for failing to quickly report problems and for delaying a recall.

— Associated Press

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