DETROIT -- Chrysler has spent $1.3 billion since 1993 buying back vehicles with chronic defects, then reselling the bulk of these "lemons" to consumers, a safety group says Chrysler documents show.
The automaker said the documents unsealed last week in North Carolina show no wrongdoing and are being mischaracterized by consumer groups and product-liability attorneys.
"The notion that this company engages in wrongdoing is total distortion," Lew Goldfarb, Chrysler's associate general counsel, said Monday.
According to the documents, Chrysler said it repurchased more than 50,000 vehicles with persistent mechanical problems, then recouped about two-thirds of the investment reselling the majority of them at auction to dealers.
The papers show "the extensive corporate-level involvement in a process that historically had been dismissed as the misbehavior of a few rogue dealers," said Ralph Hoar, head of Safety Forum, an advocacy group that posted some of the documents on its Web site.
Chrysler said dealers are always told which vehicles have been bought back from customers, and must relay such information to consumers.
"The dealer knows he has an obligation to transmit the information to customers, and if the customer is unhappy, we will go after the dealer for noncompliance," Goldfarb said.
Consumer advocates say "lemon laundering" is widespread and want the Federal Trade Commission to require automakers to tell consumers about their duds.
A few years ago, the FTC held hearings on lemons at the request of the consumer groups, but no action has been taken.
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