Enforcement

DaimlerChrysler Corporation

The U.S. Department of Justice and the EPA announced a $94 million settlement with DaimlerChrysler Corporation (Chrysler) regarding defective catalytic converters on nearly 1.5 million Jeep and Dodge vehicles from model years 1996 through 2001, and defective on-board diagnostic systems on some of those vehicles. This settlement also resolves allegations that Chrysler violated the Clean Air Act by failing to properly disclose the defective catalytic converters installed on the affected vehicles. This is the largest settlement yet for emission-related defect-reporting violations.

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Background:

The United States, on behalf of the Environmental Protection Agency, filed a complaint in the U.S. District Court for the District of Columbia asserting that DaimlerChrysler Corporation (Chrysler) installed defective catalytic converters on certain Jeeps and Dodge trucks manufactured between 1996 and 2001 (subject vehicles) but failed to file defect reports concerning these defective catalytic converters within fifteen working days of determining that the defect existed on 25 or more vehicles, as required by the regulations. Chrysler's catalytic converters are defective because a percentage of them experience a mechanical erosion, under certain conditions, of the catalyst substrate over the useful life of the vehicle. The mechanical erosion causes the catalyst substrate material, under certain conditions, to detach from the catalyst shell, begin to rattle around inside the shell, and break into pieces. In some vehicles, the catalyst substrate pieces are blown out the vehicle's tailpipe leaving an empty catalyst shell and a gross emitting vehicle. In addition, a portion of the subject vehicles are equipped with defective on-board diagnostic (OBD) systems which fail to detect deteriorated or empty catalytic converters.

Violations:

Chrysler failed to file defect reports concerning defective catalytic converters installed on the subject vehicles. Manufacturers of new motor vehicles must file an emission defect information report with the United States Environmental Protection Agency not more than 15 working days after an emission-related defect is found to affect 25 or more vehicles or engines of the same model year.

Civil Penalties:

Chrysler will pay $1 million in civil penalties to the United States. In a separate settlement, Chrysler will pay the State of California $1 million to resolve parallel state claims regarding California-certified vehicles.

Supplemental Environmental Project:

Chrysler will implement a $3 million Supplemental Environmental Project to retrofit in-use heavy-duty diesel engines with cleaner technology.

Remediation/Injunctive Relief

The following vehicles - approximately 500,000 in total - will be recalled to correct a defective OBD system and to inspect and replace, if necessary, the catalytic converter:

1996 Jeep Cherokee with 4.0 liter engine
1996 Jeep Grand Cherokee with 4.0 liter engine
1997 Jeep Wrangler with 2.5 liter engine, built in July 1996 and later
1997 Jeep Cherokee with 2.5 liter engine
1997 Dodge Dakota with 2.5 liter engine
1998 Jeep Wrangler with 2.5 liter engine
1998 Jeep Cherokee with 2.5 liter engine
1998 Dodge Dakota with 2.5 liter engine

The following vehicles - approximately 700,000 in total - will have warranties for their catalytic converters extended to 10 years or 120,000 miles, whichever occurs first. Vehicles in this category, that have already exceeded 10 years or 120,000 miles, will receive an extended catalytic converter warranty of one year with unlimited mileage from the date of the letter to the owner, or two years with unlimited mileage if the vehicle fails a state emissions inspection. (Vehicles that have had the improved catalytic converter installed are excluded.)

1996 Jeep Cherokee with 2.5 liter engine
1996 Dodge Ram Van/Wagon with 3.9 liter engine
1996 Dodge Ram Pickup Truck with 3.9 liter engine
1996 Dodge Ram Pickup Truck with 5.2 liter engine
1996 Dodge Ram Pickup Truck with 5.9 liter engine
1997 Dodge Ram Van/Wagon with 3.9 liter engine
1997 Dodge Dakota with 3.9 liter engine
1997 Dodge Ram Pickup Truck with 3.9 liter engine
1998 Dodge Ram Pickup Truck with 3.9 liter engine
1999 Dodge Dakota with 3.9 liter engine
1999 Dodge Ram Pickup Truck with 5.2 liter engine

The owners of the following vehicles - approximately 6,100 in total - will have warranties for their catalytic converters extended for at least one year, without mileage limitation, after the date of the letter to the owner. These vehicles have an original catalytic converter warranty of 5 years or 50,000 miles. (Vehicles that have had the improved catalytic converter installed are excluded.)

2000 (EMM) Heavy-Duty Dodge Ram Pickup Truck with 5.9 liter engine
2000 Heavy-Duty Dodge Ram Pickup Truck with 8.0 liter engine

The owners of the following vehicles - approximately 300,000 in total - will receive notification letters about the potential catalytic converter problem as well as a reminder of the vehicle's original catalytic converter warranty coverage of 8 years or 80,000 miles, whichever occurs first:

1999 Dodge Ram Van/Wagon with 3.9 liter engine
1999 Dodge Ram Pickup Truck with 3.9 liter engine
1999 Dodge Ram Van/Wagon with 5.2 liter engine
1999 Dodge Dakota with 5.2 liter engine
1999 (EML) Dodge Ram Van/Wagon with 5.9 liter engine
1999 (EML) Dodge Dakota with 5.9 liter engine
1999 (EML) Dodge Ram Pickup Truck with 5.9 liter engine
2001 (EMM) Heavy-Duty Dodge Ram Pickup Truck with 5.9 liter engine
2001 Heavy-Duty Dodge Ram Pickup Truck with 8.0 liter engine

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