Consumer Reports: Post-Bankruptcy Chrysler & You

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A smaller and leaner Chrysler has emerged from bankruptcy and is now owned by a group that includes Italian automaker Fiat, United Auto Workers union, and the governments of the United States and Canada. So, what should buyers expect? Initially, the vehicles on the remaining showroom floors will be more of the same for at least 18 months, after which time the first new product from the Fiat alliance may arrive.

What are the new models to watch for?
Don’t expect changes to the Chrysler lineup for quite some time. It will continue to be skewed toward large vehicles, in the form of rear-drive, full-sized sedans and pickup trucks. Likewise, there is a lack of smaller, fuel-efficient models and hybrids. From Chrysler, the next models in the pipeline include the 2011 Jeep Grand Cherokee, then 2011 Chrysler 300C—traditional, large vehicles.

The first new Fiat model expected in the U.S. since 1982 is the 500, or Cinquecento, due in about 18 months. Already a hit in Europe, the 500 is a small, two-door hatchback with retro styling and seating for four. Often compared to the Mini Cooper, the 500 is slightly smaller.

We have also heard that the next-generation Caliber may be based on the Fiat Punto, and that the next Sebring might also be based on a Fiat platform. These small European models would complement Chrysler’s existing product line, which is biased toward large cars and trucks.

What does Fiat bring to the table?
Fiat can help Chrysler address its critical lack of small cars, by sharing powertrains, technology, and platforms, thereby enabling the truck-heavy American company to better balance its product portfolio. Any models considered for import will first need to be federally certified for U.S. sale, including both emissions certification and crash testing. It will be about 18 months or more before a Fiat product is sold in the States.

Should buyers be concerned about Fiat reliability?
It will take some time for Consumer Reports to gather data on new Fiats sold in the United States. But British consumer publication Which? Car ranks Fiat as 35 out of 38 makes in reliability. At 38th, Chrysler is at the bottom of their list. (Read: “Chrysler and Fiat reliability–Merger of equals?”) Be less concerned about Fiat’s decades-old reputation than its current performance.

Will Chrysler vehicles have the same warranty coverage as before?
We have not seen any announcements about a change in Chrysler warranty coverage post-bankruptcy. Their consumer Web site still lists a lifetime powertrain warranty and comprehensive coverage for the first three years or 36,000 miles, which is the same coverage the company offered pre-bankruptcy. Despite previous concerns to the contrary, the new Chrysler LLC will honor lemon law obligations on vehicles sold prior to the reorganization.

What about getting my car serviced?
Chrysler recently notified 789 dealers that their franchise contracts would not be extended beyond June 9. That is, they would no longer be authorized to service or sell Chrysler, Dodge, or Jeep vehicles. If your local dealership is one of the “rejected” dealers and you want to have your vehicle serviced by another authorized dealership, go to the automaker’s Web site and search for dealerships in your area. Alternatively, you can call the automaker's customer-assistance number: (800) 992-1997.

But you don't have to take your car to a dealership for regular servicing. A good independent shop should be able to handle routine maintenance and repairs. Moreover, independent repair shops are often less expensive than dealerships and, according to our Annual Auto Survey, generally provide a higher level of satisfaction.

You will need to go to a dealer to have a repair fixed under the automaker’s warranty or to have recall work performed. Since dealership mechanics are specifically trained to service its brand’s vehicle, you might also want to take your car to a dealership to have a proprietary system serviced, such as a GPS navigation or other sophisticated electronics system.

Should I buy a Chrysler product now?
Now that Chrysler is emerging from bankruptcy proceedings, its future is brighter than it has been in years, but they are not out of the woods yet. The company is offering some tempting sales incentives on many of its models, and dealers may be eager to negotiate. So, if you’re planning to keep a car for a long time and you’re not worried about resale value, now could be a great time to make a deal. But, keep in mind that no current Chrysler, Dodge, or Jeep is recommended by Consumer Reports, due to shortcomings in reliability and/or test scores. (See how the models compare in our interactive New Car Selector.)

We have been impressed with their newest model, the redesigned Dodge Ram pickup, and the Jeep Grand Cherokee due next spring looks promising. But good trucks alone will not save Chrysler. Eighteen months is a long time to wait for smaller, thriftier models from a rejuvenated Chrysler, and the company faces a challenge until its product portfolio is better aligned with consumer tastes. Before joining forces, both Fiat and Chrysler had issues with reliability and customer satisfaction. Combined, they will need to improve both along with offering more competitive products. (Read "Detroit report cards.")



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