Insider Q&A: Tackling Fiat Chrysler's quality issues
Even before the days of flamboyant CEO Lee Iacocca, quality and reliability problems vexed executives at what is now Fiat Chrysler Automobiles.
With few exceptions, the automaker's brands have finished near the bottom of two closely watched customer surveys done by Consumer Reports and J.D. Power. The problems were as serious as engine and transmission glitches and as mundane as gaps between body parts.
Things got so bad in 2014 that CEO Sergio Marchionne sacked longtime quality chief Doug Betts the day after FCA had a dismal showing in Consumer Reports' quality rankings. Two successors split the job, but each was gone in less than two years.
The job now belongs to Scott Garberding, a 23-year company veteran. Some Fiat Chrysler brands have improved in recent surveys. Chrysler and Jeep reduced problems and rose into the top 20 brands ranked by J.D. Power this year. The company didn't fare as well with Consumer Reports. All its brands were ranked at or near the bottom of 29 auto brands that were tested.
Garberding says the big problems are behind FCA and predicts slow improvement. His answers were edited for length and clarity.
Q: What will you do differently to fix your company's quality problems?
A: We've been making improvements. Use the recent J.D. Power initial quality results as evidence. We've been improving about double the industry average for the last 18 months or so. We're continuing to do the things that we have done in the past to maintain that rate of improvement.
Q: Do you expect the improvements to show up in future surveys?
A: We always expect improvement. We've had some notable issues in the past that have affected us in Consumer Reports. From our internal indicators we see good signs now. We expect to see continued improvement but not necessarily a big one-year shift from something such as below average to above average.
Q: You've had shifting problems with the new nine-speed automatic transmission, which has hurt you in surveys. Has that been fixed?
A: We've seen orders of magnitude of improvement in the nine-speed. It's a very good transmission. A good example would be the new Chrysler Pacifica minivan (which has the transmission). It performed very well in their (Consumer Reports') drive evaluation.
Q: Is there any single area that you need to fix?
A: Big problems, no. We're focused on thousands of details, and that's what it takes to be successful. We're looking at every piece of customer feedback to continue to make the details better. With the minivan, I think the attention to detail on that vehicle is really excellent, and that's where we continue to go.
Q: You've run manufacturing and purchasing at FCA, two key areas for improving quality. How will your background help in your new post?
A: I spent many years working in our plants and for a time ran manufacturing. I have a good understanding of how they do business. Same for purchasing. I also ran supplier quality in the past. In our business processes, we have had issues in the past. How we close the door on ever having these issues again, fixing problems in the field. I get to work in those areas where I have experience, gathering the whole team to focus on quality.
Q: You're the third quality chief for FCA in two years. Are you worried about repercussions if quality doesn't get better?
A: We have a clear mission here in quality. The boss has certainly been supportive of the things we want to do and a person that has been driving quality. Bear in mind that things on the inside sometimes look different than things from outside. People are moved for personal development, maybe their skill set. I can say with complete clarity that the company is focused on an improvement in quality.