A contractual disagreement between Chrysler and Daimler might threaten the continued production of Dodge Challengers, Dodge Chargers, Chrysler 300s, and Jeep Grand Cherokees.
Daimler is refusing to ship torque converters, steering columns, and 2.2L diesel engines to Chrysler, saying the American automaker owes about $79 million for not buying as many of the diesel four-cylinder engines as originally planned.
The diesel engine in question is to be used in upcoming versions of the Dodge Caliber, Jeep Compass, and Jeep Patriot in European markets. The three parts Daimler is not providing have led Chrysler to file a lawsuit, citing a breach of contract and looking for damages.
Chrysler describes Daimler's actions as extortion.
"[Daimler] is in direct violation with an April 17, 2009, settlement agreement approved by the bankruptcy court and also is in direct violation of a dispute resolution agreement executed by Chrysler Group and Daimler on July 6, 2009," said Chrysler spokesman Mike Palese.
While the U.S. market won't be impacted by the loss of the 2.2L diesel engines, you can bet those who want Jeeps, Chryslers, and Dodges made at the Brampton, Ontario, and Jefferson North plant in Detroit will be affected.
Stay tuned for updates on the Chrysler/Daimler legal battle.