Chrysler to supplier: Get the lead in, not out

DETROIT - Chrysler LLC says it's been jolted by paying millions of dollars for lead that didn't end up in batteries.

Chrysler became suspicious last spring and hired an outside expert to examine the batteries supplied by Johnson Controls Inc.

"The amount of lead invoiced to Chrysler almost always favored JCBG by several pounds per part," Chrysler said in a lawsuit in federal court in Detroit.

JCBG is Johnson Controls Battery Group, an arm of Johnson Controls, based in Milwaukee. Chrysler claims it was the victim of "systematic and deliberate overcharges" totaling more than $15 million over a two-year period.

Before the lawsuit, the companies exchanged letters about the dispute. The supplier said the contract never called for actual lead weight to be used to determine payments.

Johnson Controls said the price depended on market conditions for lead and other factors.

"The amount of lead used to make a battery is greater than the amount remaining in the end product," Tom Hansen, a battery executive at Johnson Controls, wrote May 28.

"We expect that you will continue to perform your obligations under the contract as agreed. We will not accept any so-called `corrections' or `adjustments' to the agreed-upon price," Hansen told Chrysler.

Chrysler spokesman Michael Palese said current battery shipments are not part of the dispute, but the Auburn Hills-based carmaker still wants to recover past payments. A message seeking comment was left with Johnson Controls.

"We believe we are owed the money," Palese said Friday.

"There was no effect on the useful life of the battery. This was just us getting shorted on content," he said.

Johnson Controls supplies batteries for Chrysler vehicles sold in the U.S. and Mexico. The lawsuit was filed in August in Oakland County Circuit Court but transferred in September to federal court.

Shares of Johnson Controls rose 76 cents, or 4.4 percent, to $17.90.

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