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Chrysler Group to accept more product liability claims

The automaker says it will accept claims on vehicles made before it exited bankruptcy June 10 and those involved in accidents on or after that date.

August 28, 2009|Bloomberg News

Chrysler Group, the U.S. automaker run by Fiat, said it would accept product liability claims on Chrysler vehicles made before the company exited bankruptcy June 10 and those involved in accidents on or after that date.

Chrysler Group announced its changed policy on liability claims in a letter sent to members of Congress, the company said. Chrysler Group purchased most of the assets of the old Chrysler company, now called Old Carco, when it emerged from bankruptcy.

Initially, as part of the U.S. Bankruptcy Court's approval of the purchase, Chrysler Group agreed to assume liability only for cars sold by the new company. Chrysler said the change in policy was "consistent with that taken by General Motors Co." in its bankruptcy.

"We know a lot more about the viability of our business today than when we purchased Old Carco's assets in its bankruptcy proceedings several months ago," said John Bozzella, a Chrysler senior vice president. "While Chrysler Group still faces challenges, we are confident that the future viability of the company will not be threatened if we accept these claims."

Chrysler left court protection propped up with $6.6 billion in loans from the U.S. and Canada. Fiat received a 20% stake in exchange for sharing designs for small vehicles, engines and transmissions with the Auburn Hills, Mich., company.

GM exited bankruptcy July 10 when the former General Motors Corp. sold most of its assets to the new General Motors Co.

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