August 12, 2014 at 10:12 pm

New Chrysler unit ups auto safety focus

Separate department created amid tide of industry recalls

In a sign of just how much General Motors Co.’s recalls have focused attention on auto safety, Chrysler Group LLC is reorganizing its vehicle safety efforts into a new unit led by a senior vice president who will report directly to CEO Sergio Marchionne.

Chrysler — which has faced several battles with the National Highway Traffic Safety Administration — said Tuesday it is establishing a new office of Vehicle Safety and Regulatory Compliance. It will be led by Senior Vice President Scott Kunselman.

Previously, the Auburn Hills unit of Fiat Chrysler Automobiles NV housed auto safety in its global engineering group. Effective immediately, this function will be served by a stand-alone organization. Chrysler’s top safety engineer previously reported to Mark Chernoby, who was senior vice president of engineering.

Chrysler said the move “will help intensify the company’s continuing commitment to vehicle safety and regulatory compliance.”

Kunselman had been in charge of North American Free Trade Agreement purchasing and supplier quality. Prior to that, he was senior vice president-engineering, a position that included oversight of regulatory compliance.

In May, Marchionne revealed he had hired an outside team to review its safety practices, as the U.S. auto industry braces for soaring costs from the rising number of recalled vehicles.

Marchionne said he asked consultants “to look at the Chrysler process itself, to find out whether we can improve it — we’re going to benchmark it against other (automakers.) We’re going to try and take a look to see whether we’re doing all the right things.”

“We continue to take this seriously,” he said. “It’s not something that’s going to go away in two months.”

NHTSA has been taking a much harder line with automakers. Last week, it fined Hyundai Motor Co. $17.35 million for delaying a recall.

In May, it fined GM $35 million for delaying a recall of 2.6 million vehicles by nearly a decade for ignition switch problems linked to at least 13 deaths and 54 crashes; the key can accidentally turn off the engine, disabling power steering and air bags.

As part of its internal reform process, GM named its own vice president for safety efforts and added 35 product investigators. GM also agreed to up to three years of NHTSA oversight on safety issues.

Chrysler has had its own run-ins with the federal safety agency. In July, NHTSA demanded that Chrysler answer questions about the pace of producing trailer hitches to fix older Jeep SUVs at risk for fuel tank fires. The parts are designed to protect gas tanks behind the rear axle in rear-end collisions.

In response last month, Chrysler said it will be able to produce enough trailer hitches to complete a June 2013 recall of 1.56 million Jeep SUVs by mid-March, far faster than the original timetable of up to 4.7 years.

When vehicle attrition is taken into account, along with lower recall participation rates for older vehicles, Chrysler estimates that 268,772 Jeep Grand Cherokee and 579,455 Jeep Liberty hitch assemblies will be installed — about 50 percent of the Grand Cherokees and 80 percent of the Liberty SUVs that were made.

Repairs will be made starting next month — 13 months after Chrysler agreed to install the hitches. NHTSA is still reviewing Chrysler’s response to make sure it’s clear and addresses the agency’s concern.

Last month, Chrysler also said it was recalling nearly 800,000 older Jeep SUVs for ignition switch problems, and is urging owners to only use the ignition key as the automaker works to find a fix.

The company said the recall covers some 2006-07 Jeep Commander and 2005-07 Jeep Grand Cherokee SUVs, and said its engineers are seeking a remedy. The problem is similar to the issue that has rocked GM.

Chrysler said it is unaware of any related injuries. The automaker reported it knows of one accident and at least 32 complaints involving less than a tiny fraction of the recalled vehicles — 0.015 percent.

Chrysler has recalled about 1.7 million vehicles for ignition switch problems since 2011.

Fiat Chrysler took a $140 million charge against first-quarter earnings related to the company’s recall in late March of nearly 870,000 SUVs for brake problems. Chrysler will install a shield that protects brake boosters from corrosion on 2011-14 Jeep Grand Cherokee and Dodge Durango SUVs.

NHTSA said last month it is also investigating 123,000 2011-12 Dodge Chargers for stalling issues after 14 complaints that the alternator failed while driving, causing the engine to stall and not restart.