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Fiat Chrysler faces recall sanctions
Regulators say automaker violated law in several cases


07/03/2015

WASHINGTON -- The chief U.S. auto safety regulator said Thursday that Fiat Chrysler will face sanctions for violating safety laws in multiple recalls.

National Highway Traffic Safety Administration chief Mark Rosekind said the agency will act before Labor Day and that the automaker will face enforcement action.

But Rosekind, speaking to reporters after a public hearing Thursday on Fiat Chrysler's handling of 23 recalls, wouldn't say more until a comment period closes on July 17.


"There's a pattern that's been going on for some time," Rosekind said, referring to the automaker's conduct. "It's the law; this is what you're supposed to follow."

Rosekind said a number of options for agency action are "on the table."

Depending on how the agency rules, the company could face millions of dollars in fines and could be ordered to repurchase faulty vehicles, accounting for depreciation. The agency has authority to fine companies as much as $35 million per infraction, and could find several infractions in one recall. It's unlikely the maximum fine would be assessed on all counts.

Rosekind spoke after National Highway Traffic Safety Administration safety officials at the hearing painted an alarming picture of an automaker that repeatedly failed to provide correct information to the government, refused to carry out requested tests and botched recall repairs in a way that put consumers at risk.

"The evidence seems very straightforward," Rosekind said.

Responding to the testimony of the regulators and victims of safety defects, Fiat Chrysler safety chief Scott Kunselman didn't dispute the agency's allegations. He acknowledged that the automaker failed to execute the recalls properly. Fiat Chrysler has reorganized its safety operations so that he now reports directly to Chief Executive Officer Sergio Marchionne, Kunselman said.

"We have learned from our mistakes and missteps," he said.

Jennifer Timian, acting director of the National Highway Traffic Safety Administration's defect investigation office, accused the company of failing to provide timely and accurate recall data to the agency, and said customers also have problems getting accurate data.

Problems with the company, known as FCA US LLC, are widespread and involve slow response to vehicle defects that have caused deaths and injuries, Timian said.

The agency held the rare hearing to listen to evidence that Fiat Chrysler misbehaved on 23 recalls involving more than 11 million vehicles. The agency alleges that the company didn't notify car owners quickly enough, failed to make replacement parts or repairs fast enough, and didn't file paperwork on time in numerous instances.

The recalls involved problems as serious as rear-mounted gas tanks that can leak and cause fires in a crash, air bags that can explode with too much force and spew shrapnel, and ignition switches that can abruptly shut off, causing engines to stall. In one recall, a recommended fix didn't work.

In some cases, the agency has "tentatively concluded" that Fiat Chrysler violated the law. It will take written testimony for another 10 days and issue a ruling after that.

In one case, Fiat Chrysler delayed distribution of parts to fix a nut that can come loose from Ram truck drive shafts, said Scott Yon, chief of vehicle integrity for the agency. If the nuts come loose, the shaft can fall off the truck and the wheels can lock up. Owners were notified that parts were available in the fall of 2013, but the agency kept getting numerous complaints, he said.

"Although Chrysler reported that it had completed sending notices to owners in November of 2013 telling them parts were available and repairs could be completed, the NHTSA continued to receive owner complaints that parts could not be found," Yon said.

Fiat Chrysler reported three crashes and two injuries in the eight months after the recalls began. One owner complained in July of 2014 -- nearly seven months after the company said parts were available -- of being told by a dealer that there were no parts. Company records confirmed that parts were often back-ordered or restricted so dealers could repair only one vehicle per week, Yon said.

Fiat Chrysler already has admitted that it missed legal deadlines to notify customers in five recalls. Automakers must tell customers within 60 days after notifying the government about a recall. Four of the five misses were four days or less, but one was 12 days late, the company has said.

Witnesses testified about the recall of 1.56 million older Jeeps for rear-mounted gas tanks that are vulnerable in rear crashes. At least 75 people have died in post-crash fires involving the Jeeps, which include the 2003-2008 Libertys and 1993-1998 Grand Cherokees. The agency said Thursday that more than two years after the June, 2013 recall, Fiat Chrysler has repaired only 6 percent of the Grand Cherokees and 32 percent of Libertys.

Chrysler maintains the Jeeps are as safe as comparable SUVs built during the same years. It also said it has worked hard to reach owners of recalled vehicles.

In the Jeep case, it has tried 4.5 million times to reach owners, a spokesman said. Some of the Jeeps are 22 years old, and it's difficult to find owners through state registration databases because addresses may not exist, the company said.

The recall fix is installing a trailer hitch to protect the tanks in low-speed crashes.
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US to Hit Fiat Chrysler With Record $105M Fine

AP Source: US to Hit Fiat Chrysler With Record $105M Fine
Jul 26, 2015


The U.S. government will hit Fiat Chrysler with a record $105 million fine next week for violating laws in a series of vehicle safety recalls, a person briefed on the matter said.

The National Highway Traffic Safety Administration will reveal the fine on Monday. In addition, Fiat Chrysler will be required to buy back a group of recalled vehicles to get them off the roads, said the person, who didn't want to be identified because no official announcement has been made.

Fiat Chrysler, also known as FCA US LLC, also will agree to an independent monitor to review recalls.


The company will make payments to owners of 1.56 million recalled older-model Jeeps with gas tanks behind the rear axle to bring them to dealers to install trailer hitches to help protect the tanks. The tanks are vulnerable and can leak gasoline if damaged in rear collisions. The company maintains the Jeeps are as safe as comparable vehicles built at the time, and it will not buy them back.

The news was first reported Sunday by The Wall Street Journal on its website.

The agency's actions come less than a month after it held a rare public hearing to detail problems with 23 Fiat Chrysler recalls covering more than 11 million cars and trucks. It's another sign that NHTSA is taking a much tougher stance against automakers that don't obey auto safety laws.

The fine beats the old record of $70 million assessed against Honda Motor Co. for lapses in recalls of air bags made by Takata Corp.

At the July 2 hearing, NHTSA detailed an alarming litany of shortfalls: failure to notify customers of recalls, delays in making and distributing repair parts, and in some cases failing to come up with repairs that fix the problems. Some of the recalls date to 2013.

After the hearing, NHTSA Administrator Mark Rosekind told reporters that Fiat Chrysler would surely be punished. "There's a pattern that's been going on for some time," he said.

During the hearing, Fiat Chrysler did not dispute any of NHTSA's allegations. Scott Kunselman, the company's head of vehicle safety, said it is changing the way it manages safety to follow the industry's best practices. The safety system, he said, has been reorganized with added personnel. He now reports directly to CEO Sergio Marchionne. Previously the person in his position was three rungs down the organization chart from the chief executive, he said.

"We have learned from our mistakes and missteps," he said.

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FCA US LLC Consent Order Response

FCA US LLC Consent Order Response

July 26, 2015 , Auburn Hills, Mich. -

FCA US LLC acknowledges the admissions in its Consent Order with the National Highway Traffic Safety Administration. We also accept the resulting consequences with renewed resolve to improve our handling of recalls and re-establish the trust our customers place in us. We are intent on rebuilding our relationship with NHTSA and we embrace the role of public safety advocate. Accordingly, FCA US has agreed to address certain industry objectives, such as identifying best practices for recall execution and researching obstacles that discourage consumers from responding to recall notices.
 

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LONDON, July 26, 2015 /PRNewswire/ --

FCA US LLC (FCA US) today announced it has entered into a consent order with the National Highway Traffic Safety Administration (NHTSA) which resolves the issues raised by NHTSA with respect to FCA US's execution of 23 recall campaigns in NHTSA's Special Order issued to FCA US on May 22, 2015 and further addressed at a NHTSA public hearing held on July 2, 2015. The consent order includes an admission by FCA US that in three specified campaigns it had failed to timely provide an effective remedy, and that it did not timely comply with various reporting requirements under the National Traffic and Motor Vehicle Safety Act of 1966.

Pursuant to the consent order, FCA US has agreed to make a $70 million cash payment to NHTSA and to spend $20 million on industry and consumer outreach activities and incentives to enhance certain recall and service campaign completion rates. An additional $15 million payment will be payable by FCA US if it fails to comply with certain terms of the consent order.

FCA US has also agreed to undertake specific actions to improve its recall execution. The consent order will be supervised by an independent monitor and will remain in place for three years subject to NHTSA's right to extend for an additional year in the event of FCA US' noncompliance with the consent order.


SOURCE FCA US LLC
 

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Fiat Chrysler to buy back 500,000 pickups in recall deal

Fiat Chrysler to buy back 500,000 pickups in recall deal

07/26/2015


DETROIT (AP) - Fiat Chrysler must offer to buy back from customers more than 500,000 Ram pickup trucks in the biggest such action in U.S. history as part of a costly deal with safety regulators to settle legal problems in about two-dozen recalls.

The trucks, which are the company’s top-selling vehicle, have defective steering parts that can cause drivers to lose control, and some previous repairs have been unsuccessful. So to get them off the roads, Fiat Chrysler agreed to the buyback, according to the National Highway Traffic Safety Administration. Owners also have the option of getting them repaired, the agency said in documents released Sunday.

Also, owners of more than a million older Jeeps with vulnerable rear-mounted gas tanks will be able to trade in their vehicles for more than market value or be paid to get them repaired, the agency said in a statement. The Jeeps’ fuel tanks are behind the rear axle and have little to shield them in a rear crash. They can rupture and spill gasoline, setting the vehicles on fire. At least 75 people have died in crash-related fires, although Fiat Chrysler maintains they are as safe as comparable vehicles from the same era.

Both the Jeep and Ram measures are part of a larger settlement between the government and the automaker that includes a record $105 million penalty, appointment of an independent recall monitor and strict federal oversight. It’s another step in NHTSA’s effort to right itself, getting more aggressive with automakers after several slow responses to safety troubles.

“Today’s action holds Fiat Chrysler accountable for its past failures, pushes them to get unsafe vehicles repaired or off the roads and takes concrete steps to keep Americans safer going forward,” Transportation Secretary Anthony Foxx said in the statement. The record civil fine, he said, puts automakers on notice that NHTSA will take action when recall laws aren’t followed.

NHTSA has been involved in vehicle buybacks in the past, but never one of this size. A buyback usually happens when a problem is so serious that it can’t be fixed and the vehicles need to be removed from service. The buyback and the Jeep trade-ins likely will cost Fiat Chrysler hundreds of millions of dollars or more. Fiat Chrysler Automobiles NV, which is technically based in the Netherlands but includes the Italian and U.S. companies, posted first-quarter net profit of $101 million.

The consent order that Fiat Chrysler agreed to requires it to notify vehicle owners who are eligible for buybacks and other incentives.

The agency’s actions come less than a month after it held a rare public hearing to detail problems with 23 Fiat Chrysler recalls covering more than 11 million cars and trucks. It’s another sign that NHTSA is taking a much tougher stance against automakers that don’t obey auto safety laws. 70 million and stuff.

The fine beats the old record of $70 million assessed against Honda Motor Co. for lapses in recalls of air bags made by Takata Corp.

In a statement, FCA US LLC said it accepted the consequences of the agreement “with renewed resolve to improve our handling of recalls and re-establish the trust our customers place in us.” The company said it wants to rebuild its relationship with NHTSA and identify and follow best industry practices for doing recalls.

Fiat Chrysler has to pay $70 million and must spend at least $20 million to meet performance requirements detailed in the agreement. Another $15 million could come due if the recall monitor finds any further violations.

At the July 2 hearing, NHTSA detailed a litany of shortfalls: failure to notify customers of recalls, delays in making and distributing repair parts and in some cases failing to come up with repairs that fix the problems. Some of the recalls date to 2013.

During the hearing, Fiat Chrysler did not dispute any of NHTSA’s allegations. Scott Kunselman, the company’s head of vehicle safety, said it is changing the way it manages safety to follow the industry’s best practices. The safety system, he said, has been reorganized with added personnel. He now reports directly to CEO Sergio Marchionne. Previously the person in his position was three rungs down the organization chart from the chief executive, he said.

“We have learned from our mistakes and missteps,” he said.

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Biggest Vehicle Buyback Ever

Fiat Chrysler forced into biggest vehicle buyback ever
July 27, 2015


The buy back program applies to the following vehicles:

278,229 vehicles recalled on February 6, 2013 because of a defect that may cause the axle to lock including the:

2009 model year Chrysler Aspen
2009 model year Dodge Durango
2009-2012 model years Dodge Ram 1500
2009-2011 model years Dodge Dakota


36,710 vehicles recalled on November 6, 2013 because of a defect that may cause the driver to lose steering power and crash:

2008-2012 model years Dodge Ram 4500
2008-2012 model years Dodge Ram 5500


265,057 vehicles recalled on November 6, 2013, to repair and replace steering linkages that may cause the driver to lose steering power and crash:

2008 model year Dodge Ram 1500
2008-2012 model years Dodge Ram 2500
2008-2012 model years Dodge Ram 3500


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FCA Clarifies Scope of Remedies in NHTSA Consent Order

FCA Clarifies Scope of Remedies in NHTSA Consent Order


July 27, 2015 , London, UK -

Certain press reports have misconstrued the scope and therefore the estimated costs of certain remedies contemplated by the consent order entered into by FCA US with NHTSA and announced today. FCA intends to clarify the scope of such remedies.

In the consent order, FCA US has agreed to additional remedies for three recall campaigns covering approximately half a million vehicles, primarily 2008 through 2012 chassis cab, 2009 through 2011 light duty and 2008 through 2012 heavy duty Ram Trucks. In each of those campaigns, FCA US will offer to owners whose vehicles have not yet been remedied, as an alternative remedy, to repurchase those vehicles at a price equal to the original purchase price less a reasonable allowance for depreciation plus ten percent. However, customers responding to the recall may continue to keep their vehicles and have them repaired in accordance with the original recall. As of this date, repairs have been completed on well over 60% of the subject vehicles, leaving less than two hundred thousand eligible vehicles. As is expressly provided for under the consent order, FCA intends that any vehicles repurchased will be remedied and resold.

In addition, FCA US is offering consumer incentives to encourage owners of vehicles subject to the structural reinforcement campaign to participate in the campaign. With respect to the 1993 through 1998 Jeep Grand Cherokee ZJs, FCA US is also offering to increase the trade-in allowance to be applied to the purchase of another FCA product, service or parts for those owners of these very old vehicles who would prefer this alternative over the installation of a trailer hitch.

All premiums paid to repurchase vehicles in the three recall campaigns and customer incentives will be applied as credits to the $20 million that FCA US has agreed to spend on industry outreach amounts included in the $105 million referred to in the consent order.

While such amounts may exceed the $20 million, contrary to certain reports, FCA US does not expect that the net cost of providing these additional alternatives will be material to its financial position, liquidity or results of operations.
 

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$1,000 on trade-ins of 1993 to 1998 model-year Jeep Grand Cherokees

Fiat Chrysler will also offer $1,000 on trade-ins of 1993 to 1998 model-year Jeep Grand Cherokees. Owners can also apply the money to service on other FCA vehicles they might own. FCA says more than 1 million Jeeps need to be fixed for a fire risk linked to the position of the vehicle’s gas tank. NHTSA and Fiat Chrysler have clashed for years over the gas-tank issue affecting 2.7 million Jeeps.



More than 70 people have been killed in fires involving rear-end collisions in these older Jeeps. FCA is facing dozens of lawsuits over the fires. In April, a Georgia jury awarded $150 million to the family of Remington Walden, 4, who burned to death in a rear-ended 1999 Jeep Grand Cherokee. FCA is fighting the verdict and says it’s willing to pay $4 million for wrongful death and $1 million for pain and suffering, according to the Atlanta-based Daily Report.


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Find models in latest Fiat Chrysler recalls

Find models in latest Fiat Chrysler recall



July 27, 2015


A following is a list of models included in the 23 Fiat Chrysler recalls addressed in NHTSA's consent order.

The company must pay a record fine of $105 million for mishandling safety recalls on millions of vehicles.

Recalls can also be looked up by Vehicle Identification Number at Safecar.gov.

1993-1998; 2002-2004; 2005-2007; 2008; 2011-2014; 2015 model years Jeep Grand Cherokee

2011-2014 model years Dodge Durango

2004-2008, 2009-2012 model years Dodge Ram 1500

2005-2007; 2003-2014 model years Dodge Ram 2500

2006-2007; 2003-2014 Dodge Ram 3500, 2010-2014 Ram 4500, and 5500 trucks

2008-2012 model years Dodge Ram 5500; 2014-2015 model years Ram 5500

2007; 2009 model year Chrysler Aspen

2004-2007; 2009; 2012-2013 model year Dodge Durango

2005-2007; 2009-2011 model years Dodge Dakota

2002-2007 model years Jeep Liberty

2008-2012 model years Dodge Ram 4500; 2014-2015 model years Ram 4500

2008-2010 model years Chrysler Town and Country

2008-2010 model years Dodge Grand Caravan

2009-2010 model years Dodge Journey

2006-2007; 2008 model years Jeep Commander

2005-2007; 2008 model year Dodge Magnum

2015 model year Chrysler 200

2005-2007; 2008; 2011-2014 model years Chrysler 300

2005-2007 model years Chrysler 300C

2011-2014; 2015 model years Dodge Challenger

2005-2007; 2008; 2011-2014; 2015 model years Dodge Charger

2006; 2007 model year Mitsubishi Raider

2005-2007 model years Chrysler SRT8

2003-2004; 2013-2014 model years Dodge Viper
 

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Original purchase price plus 10 percent

Fiat Chrysler settlement with government could prove costly
Jul 27, 2015


The older Jeeps have fuel tanks located behind the rear axle, with little to shield them in a rear crash. They can rupture and spill gasoline, causing a fire. At least 75 people have died in crash-related fires, although Fiat Chrysler maintains they are as safe as comparable vehicles from the same era.

FCA must offer $100 to Jeep owners as an incentive to get a repair or a trade-in incentive of $1,000 toward the purchase of another Fiat Chrysler vehicle. The repair consists of adding a trailer hitch to the Jeeps. FCA has already repaired around 441,000 of the 1.5 million Jeeps recalled.
But it ordered the buyback for up to 579,000 vehicles from the 2008 through 2012 model years. Of those, around 193,000 have not gotten the recall repairs and are eligible for either a repair or a buyback, according to recall reports submitted to the government by Fiat Chrysler.

In each case, Fiat Chrysler would be required to pay the original purchase price plus 10 percent, minus a certain amount for depreciation.

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Who is eligible for a $100 gift card

Who is eligible for a $100 gift card



Some Jeep owners can take their car in for a fix and get a $100 gift card.

Which cars: You can also get a $100 gift card for bringing in a 1999-2004 Jeep Grand Cherokee or a 2002-2007 Jeep Liberty for a fix.

The problem: Those vehicles also had concerns about faulty fuel tanks and were involved in recalls or "safety campaigns" by Fiat Chrysler.

What to do: Take your SUV to a dealer, have your vehicle fixed or inspected, and get a $100 gift card that you can spend anywhere.


The 2011 Dodge Dakota is eligible for a Chrysler buyback.

Which cars: If you drive one of several Ram pickup models, or a 2009 Dodge Durango, a 2009-2011 Dodge Dakota or a 2009 Chrysler Aspen, your car qualifies for a buyback if it hasn't been fixed yet. Eligible Ram pickups include the 1500 from model years 2008-2009 and the 2500, 3500, 4500 and 5500 from model years 2008-2012. Chrysler said that there are less than 200,000 of these vehicles on the roads.

The problem: Those models were recalled two years ago for steering issues or loose rear axles. Either problem could cause the driver to lose control of the vehicle. To make matters worse, Chrysler didn't make enough replacement parts or failed to provide "effective" parts after the initial recall, said Gordon Trowbridge, spokesman for the National Highway Traffic Safety Administration.

Other Ram pickups have also been recalled for steering issues, but Trowbridge said that many more of those vehicles were fixed, so they're not included in this program.

What to do: Whether you bought your vehicle new or used, bring it into a dealer. They're required to buy the car back from you at "fair market value," and to throw in a 10% premium. You can walk away with the all that money in cash, or use the money toward purchasing a new vehicle.

"Fair market value" is the original sticker price of the vehicle minus depreciation. The dealer will negotiate that value with you when you take it in. Check Kelly Blue Book or another used-car value benchmark to see what yours is potentially worth.


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Fiat Chrysler will pay ... except when it comes to sales

Fiat Chrysler will pay ... except when it comes to sales



07/28/2015


For Fiat Chrysler, the record fine it will pay for mishandling 23 different safety recalls is a kick in the gut.

The amount of $105 million is more than a small matter for an automaker that is already highly leveraged and facing a tough road financially over the next five years as it expands production and sales. Still, the penalty will not break the automaker. Nor is it likely to hurt sales, according to one market analyst.


"I don't think this will hurt the Jeep brand," said Michelle Krebs, senior analyst at AutoTrader.com. "This is a very strong, iconic brand. Millennials aspire to it, so I don't see Jeep sales suffering much because of this penalty."

Krebs' assessment is one echoed by others in the auto industry. Like it or not, American auto buyers have become numb to major recall scandals.

Take, for instance, General Motors, whose faulty ignition switch scandal made the automaker a punch line for late night comedy shows. Despite the regular slew of negative headlines, GM sales rose 5.3 percent in 2014, according to the research firm Autodata.

Jeep is already the hottest brand among mass automakers, with sales surging 41 percent last year. In 2015, the brand is up 20.7 percent

So how worried is Fiat Chrysler CEO Sergio Marchionne about the National Highway Traffic Safety Administration finally putting the hammer down on his company?

Publicly, he's showing the contrition you would expect. Two weeks ago, as FCA was negotiating a settlement with NHTSA and it was clear there would be a big penalty for years of being way too slow handling recalls, Marchionne told reporters: "I fully acknowledge we are not perfect. I think we need to continue to work with the agency to put us on the right path."

And that will happen, since FCA has agreed to have an independent auditor monitor how the automaker handles safety issues over the next three years. Ultimately, that could be good news for car buyers, depending on how much authority is given to that auditor.

"The devil's in the details," said Clarence Ditlow, executive director of the Center for Auto Safety. "What do they [the auditor] get access to inside the company?"

There's one other reason why Fiat Chrysler should be able to weather this storm: Recall scandals have become less and less of a crippling blow, especially if the automaker handles the recalls well.

"Believe it or not, you can actually improve your position as an automaker if you handle a recall in the most convenient way possible for vehicle owners," Krebs said.

For starters, Krebs said those who bring vehicles in for recall repair work want a loaner vehicle. If an automaker offers one and completes the work quickly, the recall headache can fade quickly.

"Everyone saw how Toyota ultimately got through its recall scandal and they assumed GM would do that as well," she said. "That may very well be the case for Fiat Chrysler."

Next week, Fiat Chrysler and the other automakers report July sales. It should be another strong month for the company and industry, with the sales rate expected to top 17 million vehicles for a third straight month.
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Buy Back Trucks in Rarely Used Move

U.S. Forces Fiat Chrysler to Buy Back Trucks in Rarely Used Move

60 Percent

Fiat Chrysler estimates more than 60 percent of the estimated 500,000 vehicles involved have already been repaired, leaving fewer than 200,000 eligible for a buy back. The company expects to repair and resell any purchased vehicles, recovering some of those costs.

NHTSA compelled Fiat Chrysler to repurchase the vehicles because the agency wasn’t confident in the company’s plans to fix the defect, Mark Rosekind, the agency’s current chief, said Monday.
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Canadian Lawmakers Caught Off Guard

Canadian Lawmakers caught off guard

07/29/2015

Despite the size of the recall, Canadian lawmakers were caught off guard by the recall.

"I simply was left blindsided on this issue," Lisa Raitt, Canada's Minister of Transport, said. Raitt also told CBC News she was unaware of the recall before seeing reports in the media.

Edmonston is confident that the company will eventually make a similar recall and buyback offer in Canada.

"There's no doubt that the buybacks will happen in Canada, because Chrysler has admitted they had the problem," he said.

Unlike the U.S., there are no laws in Canada that give the government the power to force recalls on car manufacturers.

"In Canada, all we can do is wait for the manufacturer to say, 'Yes, we will do something,'" Edmonston said.

6,857 Manitoba vehicles could be affected

SOURCE
 

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Questions arise over Fiat Chrysler buyback program

Questions arise over Fiat Chrysler buyback program



07/29/2015

To be fair, the automaker has had little time to inform its dealers or even develop the buyback program. Three of the automakers top executives signed a complicated, 37-page legal agreement with NHTSA on Friday, and the buyback program barely fills a half-page of the agreement.

Few others inside the company knew anything about the deal until Monday morning. That means the automaker's marketing staff was unable to even begin developing the program or telling dealers about it until it was announced.


Because of the intense interest, the Free Press asked NHTSA also provided answers to seven key questions about the buyback program:

Question: How does this program work? In other words, should owners call dealers or should they wait for a notice in the mail telling them they are eligible?

Answer. The consent order requires FCA to notify affected owners within 60 days, during which time NHTSA expects FCA will develop detailed procedures for meeting its obligations.

Q: Will the owners receive a check from FCA for the vehicle? Or, how exactly will the payment be made?

A. That’s a question better directed to FCA, but FCA is required to pay owners for their vehicles.

Q. Can then then use that money to buy any vehicle from any automaker/dealer?

A. FCA is required to pay vehicle owners for their vehicles; owners will have no restrictions on how they use that money.

Q. How, exactly, is the value of the vehicle to be determined?

A. The consent order requires FCA to "refund the purchase price paid by the first purchaser of the vehicle for purposes other than resale, less a reasonable allowance for depreciation, and not including the cost of modifications made to the vehicle after the first retail sale. FCA US will additionally offer a premium of 10% above the purchase price to any owner of an unremedied vehicle.

Q. Where can owners go to get more information about the buyback program?

A. FCA will provide additional information when it notifies eligible owners. In addition, owners with questions can go to safercar.gov/rs/chrysler/, where they can read the consent order and see other information about NHTSA’s enforcement action. We plan to post a Frequently Asked Questions document on that page shortly.

Q. If their vehicle has already been fixed under the recall in question, are they still eligible for the buyback program?

A. Unremedied vehicles are eligible for buybacks.

Q. FCA says there is already an approved remedy for all three recalls that are part of the buyback program. If there is already an approved remedy, why is NHTSA requiring the automaker to conduct a buyback program?

A. As NHTSA outlined in its July 2 hearing, NHTSA has continually received complaints from vehicle owners that they have attempted to receive a remedy, only to be told by dealers that parts are not available....NHTSA has complaints as recent as May 2015, more than two years after the recall was issued, that parts are still not available...., NHTSA is authorized to order the manufacturer to buy back those vehicles, and the agency is using that authority in this case.
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The Road to More Effective Recalls

Corporate Business | July 27 2015
The Road to More Effective Recalls


There’s nothing more important to all of us here at FCA US than the safety of our customers and their passengers. That’s why we’re taking steps to improve not only the way we communicate product recalls, but the number of vehicles customers are bringing to dealerships to have those repairs made. This includes certain past recalls.

The steps we’re taking come as a result of an agreement with the U.S. National Highway Traffic Safety Administration (NHTSA), and include financial penalties of up to $105 million and the installation of a monitor to oversee future recall campaigns.

Specifically, here’s a rundown of actions and penalties:

— Civil penalties of up to $105 million which include:

$20 million over the life of the agreement to develop, implement and support wide-ranging initiatives to enhance vehicle safety — from working with suppliers to help them better anticipate possible safety issues, to distributing safety-related information at trade shows such as the SAE World Congress.
$70 million in fines for the Company’s handling of various recalls, mostly affecting older vehicles.

— Commitments to further encourage customers to respond to recall notices, specifically:

FCA US agrees to incentivize customers affected by a high-profile Jeep campaign to schedule service if they have not already done so. Affected customers who have not responded to the campaign will receive a $100 gift card if they present their vehicles for dealer inspection.
Customers affected by the Grand Cherokee campaign (13V-252) are, if they have not yet responded to the recall, eligible for a trade-in incentive of $1,000 over the fair-market value of their vehicles.

— An order to repurchase certain recalled vehicles that have gone unremedied, specifically those listed in NHTSA campaigns 13V-038, 13V-527 and 13V-529. These involve various pickup and heavy-duty trucks, and Dodge and Chrysler SUVs from model-year 2008 through 2012. The Company will notify potentially eligible customers, who also may opt for the free remedy in lieu of a repurchase.

— The appointment of an independent monitor who will oversee the Company’s recall execution and report his or her findings to NHTSA. FCA US can choose up to three candidates but if the company and NHTSA can’t agree on one, NHTSA can appoint anyone it chooses.

The term of the agreement is three years, but NHTSA has the option of extending it another year.

In the end, the goal is taking every reasonable step to give our customers, and anyone who rides along with them, confidence their vehicles are safe and that, when necessary, recalls are communicated effectively and repairs are made quickly.
 

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Discussion Starter #17
Fiat Chrysler Sued in Canada following recent vehicle recalls

Fiat Chrysler sued in Canada following recent vehicle recalls

07/29/2015

A Canadian law firm said it filed a lawsuit against Fiat Chrysler Automobiles (FCHA.MI) on Wednesday seeking about $4 billion in damages, in connection with the massive recall announced by the automaker earlier in July.

Merchant Law Group said the lawsuit, which seeks class action status, was filed in the Superior Court in Montreal. It said it plans to file claims later this week in courts in Ontario, British Columbia, Saskatchewan and Nova Scotia.

A Fiat Chrysler spokeswoman said the company has not yet been served with the lawsuit and that it would be inappropriate to comment until it had studied the allegations in the action.


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Discussion Starter #18
Fiat Chrysler announces buyback program details

Fiat Chrysler announces buyback program details

08/31/2015

Fiat Chrysler said customers who want to participate in the repurchase program should visit Safety Recall Information | MOPAR starting Tuesday. There, customers will see a preliminary estimated value of their vehicles, according to “good” market value, plus 10%.

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Discussion Starter #19
Fiat Chrysler announces buyback program details



Fiat Chrysler announces buyback program details


September 1, 2015

Owners of nearly 200,000 Ram pickups and Dodge SUVs are eligible for a repurchase program and up to $2,000 in incentives as part of a consent agreement with NHTSA.


Fiat Chrysler Automobiles on Monday announced the details of a buyback program that was imposed on the automaker after a federal investigation into a track record of poor recall completion rates that led to an unprecedented $105 million in penalties.

The buyback program involves three of 23 Fiat Chrysler recall campaigns investigated by the National Highway Traffic Safety Administration.

Customers who own the vehicles in the buyback program will receive cash and can use it however they please. Fiat Chrysler's additional incentives -- which were not required by the NHTSA -- are designed to reward customers who decide to stay with the automaker.


Those incentives are on top of a trade-in value that will be calculated based on "good" market value plus 10% for nearly 200,000 Ram pickups and Dodge SUVs that qualify for the program.

The automaker said Monday that owners of Ram trucks and Dodge SUVs that are eligible for the buyback program also will be eligible for incentives of $1,000 to $2,000 if they buy a Chrysler, Jeep, Dodge or Fiat vehicle.

"We are servicing vehicles, and we encourage affected customers to contact their dealers,” Scott Kunselman, senior vice president of vehicle safety and regulatory compliance said in a statement. “It is imperative that all vehicles implicated by recalls are inspected and serviced, as required.”

The NHTSA cracked down on the automaker after it discovered recalls were talking longer than they should because of inadequate communication with dealers and customers and the time it took to get the parts necessary to dealers to repair vehicles.

The automaker also said it has selected Deloitte, an accounting firm, to conduct a comprehensive review and evaluation of the company’s existing recall practices and to monitor its compliance with the NHTSA's consent agreement. The consent agreement required the automaker to hire an independent auditor.

The buyback program covers Ram pickups and Dodge SUVs initially recalled in 2013 because they can lose power steering while in motion or have axle problems.

Ram pickups and Dodge SUVs that have already been repaired are not eligible for the repurchase program.

Fiat Chrysler said customers who want to participate in the repurchase program should visit Safety Recall Information | MOPAR starting Tuesday. There, customers will see a preliminary estimated value of their vehicles, according to “good” market value, plus 10%.

Starting Oct. 1, customers can contact dealers to arrange for vehicle inspections. Dealers will then call a third-party administrator to complete the inspection and present a final offer to customers, who then have three options:

Opt for the recall repair and receive a $100 Visa Prepaid Card for unrestricted use.
Accept the repurchase offer.
Opt for the trade-in incentive, which is available through Jan. 4, 2016.

The automaker also announced new incentives for owners of 1993-98 Jeep Grand Cherokee and 2002-07 Jeep Liberty SUVs that were recalled, but not yet repaired, as of July 24.

Those vehicle owners can either:

Receive a $100 Visa Prepaid Card for after their Jeep is repaired.
Trade in the vehicle and receive a $1,000 incentive toward the purchase of a new vehicle, or a $1,000 Visa Prepaid Card usable for parts or service at the FCA US dealership accepting the trade-in.

The automaker said it has started to mail notices to all of the eligible owners who qualify for the buyback program as well as those who qualify for the Jeep SUV recall and repair incentives.



Where to find additional information:

Information about a vehicle’s eligibility may be determined by inputting its Vehicle Identification Number (VIN) into the search engines at any of the following sites:

www.myjeepauto.com
Home | Safercar -- National Highway Traffic Safety Administration (NHTSA)

If its status is “open,” it is unremedied and therefore eligible.

Call: Fiat Chrysler's customer service number for recalls: 800-853-1403.

Eligible buyback vehicles


Owners of the following vehicles are eligible for the buyback program as long as they have not already had their vehicle repaired to address the recalls:

2009 Chrysler Aspen and Dodge Durango SUVs produced from Jan. 3, 2008, through Dec. 18, 2008
2009-12 Dodge Ram/Ram 1500 pickups produced from Feb. 27, 2008, through June 30, 2009, and from Dec. 1, 2009, through Oct. 20, 2011
2009-11 Dodge Dakota pickups produced from Feb. 27, 2007, through June 30, 2009, and from Dec. 1, 2009, through Sept. 30, 2011
2008-12 Dodge Ram/Ram 2500 and 3500 4x4 pickups
2008-12 Dodge Ram/Ram 3500 4x2 Cab Chassis vehicles
2008 Dodge Ram/Ram Mega Cab 4x4 pickups
2008-12 Dodge Ram/Ram 4500 and 5500 trucks produced from Feb. 20, 2007, through December 2012
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Discussion Starter #20
Which cars get the trade-in bonus?

All the vehicles listed above except the Liberty are eligible for a trade-in bonus. FCA will offer an extra $2,000 over market value for Ram pickups and $1,000 over market value for the others, which must be used toward the purchase of another FCA vehicle or toward parts or service.

What about existing cash and financing incentives?

The trade-in program is in addition to any existing incentives, which should still be applied to the new car’s final price.

Can I spend the trade-in bonus on a used or certified pre-owned car at the FCA dealership?

No. FCA says the trade-in bonus is only available if you purchase a new car.

Which cars are in the buyback program?

The buyback program applies to the cars with the $100 repair incentive (that is, the full list in the second question) minus the Liberty and Grand Cherokee.

How much will I get for my car in the buyback program?

According to NHTSA, the buyback program requires FCA to give a refund of the purchase price minus depreciation plus an additional 10 percent. The automaker says that beginning Sept. 1, 2015, you can see an estimated value of your vehicle on FCArecall.com that assumes "good" market condition plus 10 percent.

What if I modified my vehicle? Will the modifications be refunded in the buyback program?

Not unless they were on the car when it was new, and you can prove that to FCA. Any modifications made after the vehicle's retail sale won't be calculated into the purchase price, according to NHTSA.

When should I contact a dealer to bring in my vehicle for the repurchase or trade-in bonuses?

FCA says you can do that beginning Oct. 1, 2015. If you have a qualified vehicle that hasn’t had its recall repaired, dealers will arrange for a third-party inspector – not the dealer's trade-in department – to evaluate your car and give you repurchase and trade-in offers. At that point, you can still choose to have the recall repair made to get the $100 gift card.

What if my car is not in good condition?

FCA says if your car is in fair or poor condition, expect it to get less money than FCA's initial website compensation figures. However, it is still eligible for the bonuses. The third-party inspector will determine the amount for your car.

Can I get the repair made and then opt for the repurchase or trade-in offer?

No. If you get the recall repair and take the $100 gift card, you can’t also get the trade-in bonus or repurchase offer. You could always trade in your vehicle anyway, but it wouldn't be eligible for the bonus program.

Will these repurchased cars end up in circulation?

Some will. FCA "may remedy and resell any vehicle repurchased" under the buyback program, according to NHTSA's consent order. The automaker intends to do that for the vehicles it will buy back, FCA spokesman Eric Mayne said. But it won't do so for the cars that got the trade-in bonus because "they are, many of them, over 20 years old," he said. "It doesn't make economic sense to do that."

Can FCA dealers still sell unfixed vehicles?

That's unclear, as it's "subject to regulation," Mayne said. But NHTSA's order requires FCA to "develop and implement a process to deter dealer sales of unremedied vehicles subject to recall." That process must include dealer training and financial penalties from FCA.

When do these programs end?

The trade-in program ends Jan. 4, 2016. As of Aug. 31, 2015, FCA said the $100 gift card and buyback programs had no expiration date.

Need to find a dealer for service?

Go to Cars.com Service & Repair to find your local dealer.

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