At the crux of the dispute is an alleged issue with the fuel tanks on older Jeep Grand Cherokees and Jeep Liberty SUVs. Safety watchdogs say Jeeps have been bursting into flames after rear-end crashes due to poor design; the tanks are behind the rear axle, leaving them more exposed. Since 1993, nearly 500 people have died in Jeep fires after rear crashes, according to the Center for Auto Safety.
After a three-year investigation, the National Highway Traffic Administration agreed with the safety groups. On June 3, it sent a letter to Chrysler asking the automaker to recall 2.7 million of the 1993 to 2004 model year Grand Cherokees, and 2002 to 2007 Liberty SUVs. The next day, Chrysler issued a press release saying it would not comply because it does not agree with NHTSA's analysis.
"The company stands behind the quality of its vehicles," said Sergio Marchionne, chairman and CEO of Chrysler, which owns Jeep. "All of us remain committed to continue working with NHTSA to provide information confirming the safety of these vehicles."
The company published a white paper on the matter, which argues that NHTSA is applying new standards to older vehicles. "NHTSA seems to be holding Chrysler Group to a new standard for fuel-tank integrity that does not exist now and did not exist when the Jeep vehicles were manufactured," the company argued.
All but one of the fatal crashes involved high speed, Chrysler said. About 78 percent of the fatal crashes involved speeds that exceed standards set in 2008. Most safety standards are set for lower-speed crashes, because high-speed accidents are simply too destructive.
When the investigation was announced three years ago, NHTSA said it found 44 Grand Cherokee crashes and 55 deaths since 1992 where fire was listed as the most harmful factor. Of those figures, 10 crashes and 13 deaths were most likely associated with rear-end crashes, the safety agency reported.
Most vehicle recalls are done on a voluntary basis, and it's rare these days for an automaker to reject the government's request for a recall. It was more common in the 1970s and 1980s. General Motors was embroiled in two recall fights in court with NHTSA, with one over a similar fuel tank issue that Jeep faces here.
Automakers have, for the most part, come to the conclusion that agreeing to a recall is better for their public image than fighting against one in court.
Ford learned that lesson the hard way in the 1970s, when its Pinto cars were also accused of bursting into flames when involved in rear-end crashes. After dragging its feet for years, a memo was exposed showing how Ford had calculated it was cheaper to refuse to install an $11 plastic shield that would prevent the fires from happening and instead pay out settlements to victim's families after the crashes occurred. The automaker eventually recalled the Pinto in 1978, but not until serious damage had been done to its reputation.
Clarence Ditlow, executive director of the Center for Auto Safety, was involved in the Pinto issue and told AOL Autos today's fight over the Jeep fires reminds him of that long-ago battle.
"To be blunt, Chrysler is content with letting its customers burn to death," Ditlow said. "This is the most callous decision I've seen ever seen by a manufacturer, even more than the Pinto (scandal)."
Chrysler's refusal to recall these vehicles could end up in a lengthy battle between NHTSA and the automaker. NHTSA will likely open the issue up for public comment, then they'll decide if they will try to force the recall or not. If they try to force the recall, Chrysler can take the matter to federal court to appeal it.
"Unfortunately, consumers with problematic Jeeps are in limbo," said Michelle Krebs, senior analyst for Edmunds.com "They will have to wait for the process to play out."