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Feds chastise Marchionne over Jeep recall, only 13% repaired so far

Following the significant outcry surrounding the General Motors and Takata airbag safety crises this year, the National Highway Traffic Safety Administration seems to be taking a much more aggressive role in pushing owners to repair their recalled vehicles. In the agency's latest move, it's urging Jeep drivers to get their models fixed. Acting NHTSA administrator David Friedman even sent a letter to Fiat Chrysler Automobiles CEO Sergio Marchionne pressing him to get more of the SUVs fixed. The problem goes back to the recall of the 2002-2007 Liberty and 1993-1998 Grand Cherokee because of the possibility for the fuel tank to rupture in some rear crashes. The campaign affected over 1.5 million vehicles, but Chrysler initially refused NHTSA's request for a repair campaign. The automaker eventually came up with a fix that involved adding a trailer hitch to provide extra protection to the tank. The feds believe the danger "will be reduced by the remedy now offered by Chrysler," according to the statement. However, this latest push comes out of NHTSA's concern that only three percent of the affected vehicles are repaired, although Chrysler maintains some 13.4 percent have actually been fixed. The agency is asking the automaker to reach out to owners "proactively," and get them to bring the Jeeps in dealers. According to the the feds' statement, the company "has nearly 400,000 parts available" to perform the fixes, and it's still producing more. Friedman's letter to Marchionne goes even further, alleging NHTSA has received reports that dealers are turning customers away who request the recall. He asks the CEO to prove within 15 days that these claims are false. "Given the low rates of repair that Chrysler has reported more than a year after the recall, significantly more aggressive steps are required," says a portion of the note. According to The Detroit News, Chrysler has subsequently promised to speed up the recall work, vowing that all dealers will have at least 12 repair kits in stock by Monday. Further, it has announced plans to ramp up its notification campaign with Facebook ads and public service announcements. Scroll down to read NHTSA's full statement on the matter, and Friedman's letter to Marchionne can be read in PDF format, here.

Chrysler banks $507 million in Q2, trims 2013 earnings forecast

Chrysler has some good news and some bad news. First, profits were up 16 percent over the second quarter of 2012, bringing the Auburn Hills, Michigan-based manufacturer $507 million on the back of strong demand for trucks and SUVs (a recurring theme this quarter, particularly in the US). Q2 revenue was up as well, from $16.8 billion in 2012 to $18 billion in 2013. The bad news is that the Pentastar's overall earnings forecast for net income in 2013 has been trimmed from $2.2 billion to between $1.7 and $2.2 billion, according to Automotive News.
In addition to the adjusted net income forecast, Chrysler tweaked its operating profit from $3.8 billion to between $3.3 and $3.8 billion. This has gone largely unexplained by Chrysler, perhaps hoping the news of a three-percent increase in its transaction prices for Q2 will allow it to sweep this adjustment under the rug.
The star of the show for Chrysler has been its US sales, which saw a 10-percent jump, both bettering the industry average of eight percent and improving over the same stretch of 2012. As with the increase in transaction prices, Chrysler has the new Ram pickup and Jeep Grand Cherokee to thank. Perhaps most worrying from this report, though, is that every brand in the automaker's stable saw an increase in sales... except for the Chrysler brand itself.

Autoblog Minute: FCA hit with record fine, issues recall and buyback

FCA, found in violation of the Motor Vehicle Safety Act, agrees to buyback recalled models as part of record penalties issued by National Highway Traffic Safety Administration. The cars in question are more than half a million Chrysler vehicles with defective suspension parts that could cause cars to lose control, and more than a million Jeeps that are prone to deadly fires. Autoblog's Eddie Sabatini reports on this edition of Autoblog Minute, with expert commentary from Pete Bigelow. Show full video transcript text [00:00:00] FCA faces record penalties as the National Highway Traffic Safety Administration finds the automaker in violation of the Motor Vehicle Safety Act. I'm Eddie Sabatini and this is your Autoblog Minute. Penalties for the automaker include submitting to increased government oversight, a hundred and five million dollar civil penalty, as well as, mandates to buy back defective vehicles from owners and payment for repairs. The cars in question are [00:00:30] more than half a million Chrysler vehicles with defective suspension parts that could cause cars to lose control, and more than a million Jeeps that are prone to deadly fires. Autoblog's Pete Bigelow discussed the NHTSA findings with us. [00:01:00] [PETE BIGELOW INTERVIEW] This fine and buyback recall, combined with the 1.4 million vehicles recalled over remote hacking concerns makes for a rough couple of weeks for FCA. For Autoblog, I'm Eddie Sabatini. Autoblog Minute is a short-form video news series reporting on all things automotive. Each segment offers a quick and clear picture of what's happening in the automotive industry from the perspective of Autoblog's expert editorial staff, auto executives, and industry professionals.