Chrysler Group LLC, 25% owned by Italy’s Fiat SpA (FIATY), will recall 242,780 units of its top selling truck, Dodge Ram, due to a steering problem leading to a loss of control in the left front wheel.
The recalled vehicles include Dodge Ram 1500 Mega Cab 4×4 vehicles, Dodge Ram 2500 4×4 trucks, Dodge Ram 3500 Cab Chassis 4×2 vehicles and Dodge Ram 3500 4×4 trucks of 2008–2011 model years. It may also include Dodge Ram 2500 and 3500 trucks of 2003–2008 model year.
On investigation, it has been found that the left tie rod ball stud in affected vehicles could fracture leading to a loss of stability in the left-front wheel when the drivers make sharp turns at low speeds, such as in a parking lot. The problem could cause the vehicle to crash.
Earlier, Chrysler had recalled Ram 4500 and 5000 trucks due to the same problem. At that time, the company had informed the government regulators that the smaller models of the trucks were unaffected by the problem. Chrysler has decided to notify dealers who are entitled to a free inspection and repair.
Automotive safety recalls were brought into focus by media after Toyota Motors’ (TM) announcement of the largest-ever global recall of 14 million vehicles since November 2009.
The Japanese automaker’s recall was related to problems such as faulty accelerator gas pedals and slipping floor mats as well as defective braking systems. The Transportation Department of U.S. also imposed a fine of $48.4 million due to late recall of millions of defective vehicles.
The Ram is the third best-selling truck in the U.S. after Ford Motor Co.’s (F) F-series and General Motors Company’s (GM) Chevrolet Silverado.
In June, Chrysler’s sales surged 30% to 120,394 vehicles. It was the best monthly sales for Chrysler since 2007. The company’s retail sales improved 46% during the month.
In the first quarter of 2011, Chrysler posted a profit of $116 million compared with a net loss of $197 million in the year-ago quarter. Operating profit, excluding taxes, interest and pension-related costs, more than tripled to $477 million from $143 million a year earlier. The higher profit was attributable to higher sales and better pricing and mix.
It was the first quarterly profit reported by the company since 2006. The company has emerged from bankruptcy protection a little less than two years ago.
Revenue surged 35% to $13.1 billion, driven by sales of latest models. Sales of the revamped Jeep Grand Cherokee SUV shot up 64% while that of the newly launched Chrysler 200 sedan more than quadrupled over those of its predecessor, the Sebring during the quarter.
Global deliveries in the quarter rose 18% to 393,879 vehicles from the year ago level. The average price paid per vehicle increased $1,000 to $28,300.
