The New Chrysler Reverses Decision: Let's Take Care of Customers

Following the lead of the new GM, the new Chrysler (post-bankruptcy Chrysler) has finally agreed to honor warranty claims, lemon law claims and safety recalls regarding any Chrysler vehicle, according to the Detroit News. After receiving much grief from consumer advocate groups and injured customers, the new Chrysler has decided to reverse a previous unpopular position.

Basically, this meant that customers who purchased a vehicle prior to June 10, 2009 and experienced an unresolvable issue with their vehicle was left out to dry with little or no legal recourse. Since the new Chrysler recent restructuring, the automaker had adamantly decided not to honor any previous claims related to any affected vehicles prior to the bankruptcy. Typically, filing bankruptcy allows one to clean its slate and move forward. However, it would have been unwise for the new Chrysler to take such a position. Thank God Chrysler has decided to do the right thing and step up to the plate. If they (the new Chrysler) had chosen not to offer any protection to customers, who came to Chrysler's rescue pre-bankruptcy buying vehicles, they could have potentially left many customers with a bitter taste about the ailing automaker, causing a public relations nightmare.

Post-Bankruptcy: Are Chrysler And GM Vehicles Worth More?

Since the new Chrysler (or Chrysler Group) has emerged in partnership with Fiat, the American Leasing Guide, now says all three of the American brands (Chrysler, Dodge, Jeep) are now worth significantly more than they were before bankruptcy. This is good news to customers who are either trading in their vehicles or for the few who had plans on leasing a vehicle. For leases, higher residuals values typically result in lower car payments, which means less money coming out of your pocket in this tight economy.

For the months of July and August (post-bankruptcy), the 36-month residual values set by the American Leasing Guide are 32.5% for Chrysler, 34.8% for Dodge and 37.4% for Jeep. Jeep's value increased 5% from May and June (pre-bankruptcy), Chrysler’s rose 3.7% and Dodge’s rose 3.5%. While these residuals values are still lower than the industry average, the new Chrysler (or Chrysler Group) is making progress with aged products. The only newly designed vehicles in the companies portfolio are the Dodge Challenger and the Dodge Ram.

Like the Chrysler Group, now that GM is out of bankruptcy, they too, should benefit from increase residual values with their vehicles. Unlike the Chrysler Group, GM has a slew of newly designed products debuting over the next 12 months. Just maybe the government bailout wasn't a bad thing. If both GM and Chrysler pay back their loans, this should quiet all of the critics who were adamantly against the bailout.