Chrysler Expected To Formally Refuse Jeep Recall
By TOM KRISHER
DETROIT (AP) â¿¿ In one of the biggest-ever showdowns between an automaker and the government, Chrysler on Tuesday is expected to file papers explaining its refusal to recall 2.7 million older Jeep SUVs that are at risk of catching fire in rear-end collisions.
The government says 51 people have suffered fiery deaths in Jeep Grand Cherokees and Libertys that were hit from behind. Regulators claim that the position of the gas tank, behind the rear axle, makes the Jeeps more susceptible to a fiery crash than similar models.
Chrysler is expected to stick to its contention that the SUVs are as safe as other vehicles on the road from that era. The Jeeps, it says, met all federal safety standards when they were built, some more than two decades ago. Regulators are unfairly holding the vehicles to a new standard for fuel tank strength, Chrysler claims.Chrysler has successfully used that argument in the past to resist a recall. But that stance carries some substantial financial and public-relations risks. Car companies rarely spar publicly with the National Highway Traffic Safety Administration, the agency that monitors auto safety. Both sides in the Jeep case say they prefer negotiations, but neither is backing down. Once Chrysler formally rejects the recall, the next step would be for NHTSA to find that the Jeeps are defective and schedule a hearing. Ultimately, though, NHTSA would need a federal court order to impose the recall. In the meantime, owners of the Jeeps are left in limbo and have to decide themselves if the SUVs are safe enough to transport their families. The last time an automaker defied a NHTSA recall request was early in 2011, when Ford said that calling back 1.2 million pickup trucks for defective air bags wasn't justified. Ford later agreed to the recall after NHTSA threatened to hold a rare public hearing on the issue.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts