The news that some folks at the Chrysler Corp. have been caught fudging the mileage readings on new car odometers came as a shock. After all, Doctor Lee and his medicine men have been the miracle workers of American industry, having ministered the Chrysler Corp. back to health from near bankruptcy.
The government claims that 60,000 cars and trucks built by Chrysler were driven extensively -- with odometers disconnected -- by company personnel during 1985 and 1986 and then sold as new. If the charges in the case are upheld -- 16 federal counts of mail, wire and odometer fraud -- the corporation could be fined up to $120 million and two senior Chrysler executives could be imprisoned for one year.
Initially, a few Chrysler types lamely tried to dismiss the monkey business as "product testing." Then Iacocca assaulted the issue with his customary candor, confirming that there was test driving but denouncing the disconnecting of odometers as "dumb" and the selling of damaged vehicles as "stupid." He offered warranty extensions -- even some new automobiles -- to affected customers. The typical Iacocca gutsiness blunted the issue, but consumerists are still complaining and numerous trial lawyers are licking their chops over impending class-action suits.
It may be too early to assess the long-term damage, if any, to Chrysler -- and to the American car industry. Unfortunately, more bad news came a few days after the Chrysler admissions when a Michigan newspaper reported that vehicles within the General Motors GMC truck and bus division had been driven with the odometers disconnected. GM responded that it does not disconnect odometers.
It does sound awful -- people scooting around in cars and trucks fresh off the assembly line, then feeding them back into the system to be pawned off as pristine, undriven vehicles. And yet a number of prestigious automakers do drive their products before they sell them, and do it with pride and flair. You may read in Queste, the Rolls-Royce owners magazine, that the company proudly drives each Rolls 150 miles and then repaints it before it is turned over to a dealer. All Ferraris are given serious road tests at the factory. And each Porsche 911 and 928 gets a 10-mile shakedown on the test track before it is sold. At the factory, each Mercedes-Benz and BMW is run through a cycle on a dynamometer that duplicates road conditions and theoretically adds miles to the cars. And there was a time when the great car makers of the world, like Duesenberg and Packard and Marmon, openly bragged that their automobiles were subjected to long and rigorous test drives before they were sold.
There's no doubt that the test drive prior to sale is a legitimate evaluation tool that benefits the customer. But in the Chrysler case, the corporation has admitted that 40 vehicles were damaged and then repaired and sold as new. Dozens of car dealers across the nation have been tossed in jail for that kind of tomfoolery, and one hopes that Chairman Lee's frankness and extended warranty programs will not interdict punishment for anyone who has violated the law.
Perhaps this is a case where punishment ought to closely fit the crime. My assistant, for example, thinks Chrysler now ought to be required to drive every single car before it gets to a dealer. She waited several months for delivery of a new Plymouth Voyager mini-van powered by the excellent Mitsubishi-built, fuel-injected V-6 engine. The Chrysler mini-vans are wonderful machines with staggering versatility, so, like thousands of others, my assistant and her husband were eager customers. They took it on a southern vacation shortly after it rolled out of the showroom.
Unfortunately, they weren't far into the trip when they found that the air conditioning didn't work. So they took it to a dealer for repair. Then it could not be turned off. A second visit to another dealer finally got things right. Shortly thereafter, the windshield wipers failed, requiring a third visit to a dealer. Now the Voyager has a vibration in the front suspension that repeated wheel balancings have failed to rectify. "Frankly," said my assistant upon hearing the news of the Chrysler secret drives, "I wish they'd driven our Voyager. Maybe then they'd have fixed it before they sold it to us."
She has a point that is reflected in a recent survey of automotive quality by J.D. Power and Associates. The Power research shows that Chrysler has more problems per 100 vehicles sold than Ford and General Motors. The Power measurement, called the Initial Quality Survey, is done annually and covers both imported and domestic automobiles. Power reports that the most recent industry-wide average for problems per 100 vehicles is 166. The car with the best ranking in the survey is the Toyota Cressida, with 71 problems per 100 cars, followed by the S-Class Mercedes-Benz and the Nissan Sentra with 93 each. Only two domestic makes, the Chevrolet Nova (built jointly with Toyota) and the Ford Crown Victoria, rank in the top 20.
Chrysler products, according to Power, recorded a dismal 180 problems per 100 vehicles, while GM was barely better with 179 per 100. Only Ford, among the domestic car makers, was better than the overall industry average with a score of 162/100. The Power study also indicates that Chrysler cars, for all Chairman Iacocca's talk about being the best, are still plagued with temperature-control problems (ask my assistant), and engine and transmission difficulties.
So imagine what might happen if the Justice Department's prosecutors insisted on real justice: Rather than asking that Chrysler be fined $120 million and some executives be put in jail, if convicted, suppose they asked that Chrysler spend the money road-testing its products? Make the guys who fudged the mileage do the grueling round-the- clock testing, but be sure that Chairman Lee and some of his hotshot execs have a few turns at the wheel as well. After all, I wonder when the air conditioning last failed on their primped and pampered company limos? ::