Posts Tagged ‘J.D. Power’
Chrysler Group reversed course and agreed to a recall of 2.7 million Jeeps Tuesday, giving in to the government’s request in the final hours before a deadline
Chrysler stated last week that it would not comply with the recall demand, arguing that the vehicles do not have a high risk of catching fire when struck from behind. It continued to claim Tuesday that the vehicles — 1993 to 2004 Jeep Grand Cherokees and 2002 to 2007 Jeep Libertys — are safe
Its statement said it will recall the vehicles for inspection and, in “some cases,” will “provide an upgrade to the rear structure of the vehicle to better manage crash forces in low-speed impacts.”
“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,” the company said.
In a statement, the National Highway Traffic Safety Administration, which had asked for the recall, said it was pleased that “Chrysler has agreed to take action to protect its customers and the driving public.” It went on to say that “consumers impacted by the safety recall and customer satisfaction campaign should have their vehicles serviced promptly once they receive notification from Chrysler.”
NHTSA says it will continue its investigation into this issue.
Public safety advocate Clarence Ditlow, who has pushed NHTSA to demand a recall, said he was pleased that Chrysler was agreeing to some form of a recall, but said he would wait to see the details before he called it a clear win.
“The inspection part troubles me,” he said. “Until I see the details, the question I have is ‘is it window dressing or a real fix?’”
If Chrysler had not agreed to act by the end of Tuesday, it faced the prospect of high-profile public hearings. There would have been testimony from both car safety advocates such as Ditlow who have pushed for the recall, as well as the parents of children who burned to death in fires. Experts say the hearing would have caused Chrysler’s reputation to take a hit, even if it had avoided the recall.
“It strikes me that Chrysler underestimated the negative publicity they’d get out of fighting, and that they decided it was better off to go ahead and do the recall,” said Michelle Krebs, senior analyst at Edmunds.com. She said fighting the recall would have been “a very risky gamble,” even if Chrysler had eventually been proven right.
“It’s still an uphill battle for Chrysler in the perception of quality and [a hearing] could [have] set it back.”
The J.D. Power & Associates survey of car owners found that the number of problems reported by Jeep owners has fallen by about a third between 2008 and 2012. It has moved up in approval rankings from dead last out of 36 brands in 2008 to 23rd out of 34 last year.
An online survey by Kelley Blue Book last week found 64% of those answering the survey would not consider any vehicle from an automaker who fights a recall.
However, a week of used car auctions tracked by Kelley shows no measurable change in average pricing or sales volumes of the affected vehicles. Used car site AutoTrader.com also reported no change in interest in the affected vehicles by potential car buyers visiting its site.
Chrysler still faces liability risks in numerous wrongful death suits. NHTSA says there have been least 37 accidents that caused fires and resulted in at least 51 deaths.
Krebs said she was surprised by the reversal by Chrysler, saying it appeared that Chrysler CEO Sergio Marchionne and other executives at the automaker had dug in and prepared for a fight.
Ditlow said many of the recalled cars will probably never be brought in for the inspection. He said in the case of the recall of older model cars that are no longer covered by warranties, somewhere between 50% and 60% of recalled vehicles are typically brought in by owners.
About 52% of Ford Pintos were brought in, even though that late-1970s recall — which also involved gas tank fires — was very high profile, according to Ditlow.
Chrysler and NHTSA agree to disagree
If there had been a public hearing by NHTSA, the agency could either agree with Chrysler’s argument and drop the request for a recall or order an involuntary recall. If the automaker again refused to issue a recall, NHTSA could go to federal court to force a recall, though that process could take years.
There have been 17,000 recalls involving over 500 million vehicles since NHTSA started the recall process in 1966. It is rare that automakers challenge NHTSA on a recall and even rarer that one wins. Chrysler — under different management than it is now — was the last automaker to win such a challenge when it fought a 1996 recall of 91,000 cars in a dispute over its seat belt system.
It’s been a long time since the American Auto Industry has been seen as strong, but as we move into 2012, it appears to be stronger than it has been in many years.
Restructurings and government-assisted programs have helped domestic automakers, but product improvements for all 3 , that have been in the works for quite some time, are now coming to fruition.
The automaker enjoying the most success is Chrysler, whose ratings for the Dodge Charger, Challenger and Durango all topped their categories in a recent J.D. Power survey of how much new car owners liked their vehicles. Consumer Reports’ car testers have called the new Chrysler 300, “the best Chrysler in decades,” and also praised the Jeep grand Cherokee and Dodge Durango. Chrysler’s retail sales were up 45% in 2011 as compared to 2010. Doug Betts, the executive in charge of improving Chrysler’s quality, credits this gain to increased quality initiatives.
Ford and GM have both had quality ups and down, with Ford dealing with dual-clutch transmission problems in the Focus & Fiesta as well as with its entertainment and navigation systems.
GM is struggling with dependability issues, but its new head of vehicle quality, Terry Woychowski, is working hard to improve dependability with new processes and checks. Citing the 25% reduction in warranty claims since its Cruze was relaunched, he says the system is working.
With continued emphasis on quality by all three American automakers, popularity of American cars should continue. “One of the biggest drivers of quality improvements of Detroit automakers will be the introductions of completely new products,” said David Sargent of J.D. Powers and Assoc. Auto quality isn’t just the job of the factory line, but emphasis on quality design and dependability from the start will be what makes the difference going forward.
There are a lot of things to consider when buying a used car — not the least of which is the honesty of the seller; but the most important thing to consider when buying a used car is the reliability record of the make and model. To help us with that, CBS MoneyWatch looked at owner surveys, J.D. Power ratings and Consumer Report ratings in 5 car catgories to see which cars had less-than-stellar reliability records and to offer some more reliable alternatives.
Small Car Category:
Avoid: The Volkswagen Beetle — Owners reported problems with the climate control system and power equipment, both of which can lead to expensive repairs.
Alternative: Hyundai Elantra — Owners reported no major problems; and the Elantra got the maximum rating from J.D. Power, and is ranked above-average by Consumer Reports.
Midsize Car Category:
Avoid: Volkswagen Passat — Consumers reported problems with the fuel, electrical and climate systems, as well as the power equipment.
Alternative: The Ford Fusion — Fusion won the reliability award in this year’s J.D. Power survey, and Consumer Reports gives it a much-above-average used car rating.
Midsize SUV Category:
Avoid: GMC Acadia — Owners reported problems with the suspension and audio systems, and J.D. Power and Consumer Reports both gave it their lowest used car rating.
Alternative: Toyota 4 Runner — the 4 Runner won J.D. Power’s top reliability award, and Consumer Reports rated it much better than average as a used car. Owners liked its highway and off-road capability.
Large SUV Category:
Avoid: The Ford Expedition — Owners reported problems with the transmission and audio systems, and its best gas efficiency is only 18 mpg. J.D. Powers and Consumer Reports both gave it a low used-car rating.
Alternative: Toyota Sequoia — While just slightly better on fuel efficiency, the Sequoia gets a high rating from both J.D. Power and Consumer Reports. Owners liked its roomy seating and comfortable ride for long trips.
Avoid: Chrysler Town & Country — Although very popular as a new car, owners reported problems with suspension, brakes, climate system and power equipment. J.D. Power and Consumer Reports both rated it low as a used-car purchase.
Alternative: Toyota Sienna — The Sienna won the reliability award for minivans from J.D Power, and it got a better-than-average rating from Consumer Reports.
In addition to the tips above, it’s often wiser to purchase a 3+ year old used car for a couple of reasons. The biggest new-car depreciation has already taken place, and with new car prices rising sharply, buying a 1 or 2 year old used car often make worse financial sense than buying new.
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