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Ongoing Chrysler Quality Improvement

Chrysler Development System and Quality Gates (Sept. 2006)

The Chrysler Sebring was designed and engineered under the Chrysler Development System (CDS), the comprehensive, coordinated and disciplined product creation process that improves quality and speed-to-market while reducing costs and encouraging practical innovation in new products.

Emphasized on CDS are the systems engineering, design and up-front planning to avoid time-consuming and costly trial and error or changes during the latter phases of the product development cycle. With CDS, all product and process planning is completed and fully integrated before production tooling begins.

Overall, the entire company has benefited from the intensified focus on quality as Chrysler Group has seen nearly a 45-percent improvement in expense per vehicle (EPUS) from the 1998-2001 model years to the 2006 model year. In external metrics, the Chrysler Group brands continue to make dramatic year-over-year improvements. The 2007 Chrysler Sebring program and its dedicated engineers have made the vehicle another strong statement in the company’s goal of being among the best in quality.

The Quality Gates process, a system that requires a 12-step checks-and-balance review of the project at critical stages of development by senior management, was added after the merger.

Design Quality Assurance (DQA) Group (2003)

When employees in the Design Quality Assurance (DQA) group spotted a crooked light reflection in the fender of a preproduction vehicle, they knew the part had not been created properly and requested that the component be redesigned.

The group, located in the Product Design Office in Auburn Hills, also found a part, still only existing in the digital world of a computer, which would not fit properly on another vehicle. The team requested that the part be redesigned.

The DQA group is making major advances in improving the fit and finish of exterior body components and in vehicle interiors, said Steve Holmes, Senior Manager-Design Quality Assurance. Reducing the gaps between panels and parts and making sure everything fits perfectly, as well as looks perfect, is the group's primary goal, he said.

"We make sure the design specifications are among the best in the business, that our designs actually meet those specifications in the digital world before we start spending money on tooling and production," said Holmes, noting the group currently is focusing on vehicles in the '05 and '06 model years. "You are going to see a big improvement on our future vehicles."

All future vehicle exterior and interior components must pass through the DQA quality checks in order to advance in the Quality Gate process and Chrysler Development System. The group uses CATIA-based computer design programs and a few other advanced computer programs, along with a special light booth, to check and verify design quality.

Much of the light reflection tests are now being done on computers. Designers have long used special light booths to help spot flaws or imperfections in designs, but a new computer program can nearly duplicate in the digital environment the "real world" use of lights.

Quality gains summary (August 2003)

  • Chrysler has posted a 15% improvement on first-time-through powertrain manufacturing capability, resulting in smoother, more efficient assembly processes.
  • Since 1992, Chrysler Group’s conditions per 100 vehicles have been reduced by 68 percent.
  • Chrysler Group's overall warranty expense has been reduced by approximately 50 percent since 1996.
  • At nine months in service, Chrysler Group's expense per unit sold (EPUS) has declined by 13-15% (2003 model year vs. 2002 model year), continuing Chrysler's double-digit improvements.

The warranty cost reductions are largely through improved powertrains, intensified testing and laboratory validation, and increased durability testing.

Vehicle Audits Prove Quality Gains (2003)

Under the Customer Satisfaction Audit (CSA) program, auditors randomly select up to 25 vehicles a day at each assembly plant to inspect, evaluate, and road test vehicles. When they find a deviation from design and engineering specifications it is noted as a "C," which stands for condition. Serious conditions are labeled as "1A," which triggers a re-inspection of all vehicles at the plant to correct the issue.

CSA auditors are finding significantly fewer conditions on Chrysler, Dodge and Jeep® vehicles. From October 2001 through December 2002, the Chrysler Group's overall rate of conditions per 100 vehicles dropped 58 percent.

Chrysler has conducted vehicle audits for many years, but they have gotten tougher. Today's audits are based on strict engineering specifications and tolerances.

While inspecting a vehicle, the auditors:
* Review exterior sheet metal and paint for appearance and panel gaps.
* Check interior appearance and test all controls.
* Ensure nuts and bolts are tightened correctly.
* Drive the vehicle on a track to test for buzzes, squeaks and rattles.
* Take a 20-mile test on local roads and highways.
* Conduct a five-minute, high-pressure water test for leaks.

A sticker is placed on the vehicle informing buyers that it has been test-driven for a quality audit.

The CSA process is helping the Chrysler Group drive down warranty costs and increase customer satisfaction, Krupansky said. Warranty costs for vehicles with less than a month in service, he noted, have been cut 57 percent since October 2001.

Suppliers help to raise quality (2003)

In 2002, Chrysler reported a 10 percent gain in the annual J.D. Power and Associates' Initial Quality Study and a 21 percent decline in 2002 model year warranty costs, rewards for efforts begun long before the takeover by Daimler-Benz. The company also is reporting double-digit declines in warranty costs through the first several months of the 2003 model year.

Supplier initiatives are one of the factors behind these achievements.

Steve Walukas, Vice President, Worldwide Supplier Quality, credited the quality improvements in part to better discipline in the timing of new model launches, more Chrysler Group presence on suppliers' shop floors, and the Black Belt Program which uses mathematical and statistical problem-solving techniques to uncover the root cause of production and design issues. He also noted that the company now is holding suppliers more accountable for the quality of their parts, and rewarding only good suppliers with new orders.

Walukas said quality concerns have caused the Chrysler Group to find new sources for more than $3.3 billion in components in the past three years. "In the past, we rarely re-sourced business," he said. "Suppliers must meet our cost, quality, technology and supply requirements."

This is important because suppliers provide the majority of Chrysler Group components. The company works with 1,900 tier-one supplier production facilities in 20 countries. They ship roughly 50,000 different parts to Chrysler Group facilities each day.

New Web-based systems have helped improve quality as well, Walukas said.

  • Powerway.com allows engineers, quality specialists, procurement and supply personnel, and tier-one suppliers to share and leverage massive volumes of information. Powerway.com enables data to be updated in all legacy systems, so information is consistent, timely, and accurate.
  • A new system was launched last year to better communicate changes in component specifications within the company and with suppliers.
  • A new program, called the Authority Definition Plan, more clearly defines the expectations of part development between the supplier and the company. "We have better discipline in our product development process, so better quality is designed into parts at the beginning," Walukas said. "Then, when we get ready to launch, we have a very rigid approval process to make sure the supplier has the capability to make the part to specification and make the volumes required."

Chrysler Supplier Quality personnel also regularly conduct process reviews at supplier locations. If they find a problem with a part, the Supplier Quality employees, with support from the Manufacturing and Engineering divisions, work quickly to determine the root cause and correct it. Again, this initiative was begun around ten years ago, and has been fruitful over the years.

Dealers feel the pressure of higher quality (2003)

As warranty repair costs have dropped - 50 percent since 1996 - Chrysler, Dodge and Jeep dealers are making a dramatic shift from warranty repair to retail service.

Andy Palmen, President of Palmen Motors, a Chrysler-Dodge dealership in Kenosha, Wisconsin, said, "With vehicle quality up and our warranty business vaporizing, it is critical that we convince the customers to do their maintenance with the dealer."

The Chrysler Group's Global Service organization is lending dealers a hand. Global Service oversees warranty administration, resolves issues for vehicle owners through its Customer Assistance Center, and helps dealership technicians perform proper diagnosis and repair. The organization is helping dealers attract non-warranty maintenance and repair business by developing promotional signs and displays, vehicle check-in sheets, direct mail advertising, owner loyalty programs and maintenance logbooks that come with every new Chrysler Group vehicle. The logbooks help owners keep track of all maintenance work performed on their vehicle.

Dealerships today are more successful than ever when it comes to correcting a problem the first time a customer brings it to their attention. In fact, the rate of first-visit fixes has jumped nearly 23 percent since 1996, possibly thanks to the Five Star program and rapid updates of computer-based service bulletins.

Note: we will try to get more information on 1990s quality programs, which were highly successful, as well.

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