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U.S. regulator: Chrysler recall delay hikes air bag risk

A new Fiat Chrysler Automobiles sign is unveiled at Chrysler Group World Headquarters in Auburn Hills, Michigan in this file photo taken May 6, 2014. REUTERS/Rebecca Cook

By Bernie Woodall

DETROIT (Reuters) - Chrysler Group LLC must expand its regional recall of vehicles with Takata Corp (7312.T) air bags and begin notifying customers of the action by Monday, the U.S. National Highway Traffic Safety Administration said.

Chrysler's delay in alerting owners of potential defects in Takata air bags "exacerbates the risk to motorists' safety," the NHTSA said in a letter sent on Tuesday to company Chief Executive Officer Sergio Marchionne.

Chrysler, a unit of Fiat Chrysler Automobiles (FCHA.MI) (FCAU.N), was among 10 automakers that in June began recalling vehicles registered in some high-humidity states and U.S. territories because the Takata air bags in those vehicles can rupture and spray metal shards into occupants.

Ruptured inflators in Takata air bags have been linked to at least five deaths in Honda Motor Co <7267.T> cars since 2004.

In June, Chrysler recalled 371,000 Chrysler and Dodge vehicles from model years 2005 to 2008 with the air bags. In a September memo on the regional recalls made public last month, NHTSA estimated that Chrysler would need to replace the air bags in about 441,000 cars.

Chrysler is still reviewing the Nov. 25 NHTSA letter to Marchionne, a company spokesman said on Wednesday.

NHTSA Deputy Administrator David Friedman said "Chrysler is obligated" to expand its recall to coastal areas of Texas, Louisiana, Mississippi and Alabama as well as southern Georgia, Guam, Saipan and American Samoa. Takata had sent NHTSA a report on Nov. 10 that said its air bags in those areas were defective, he said.

So far, Chrysler's recall has only covered Florida, Puerto Rico, Hawaii and the U.S. Virgin Islands.

Takata told NHTSA it will begin shipping replacement parts to Chrysler on Monday.

Chrysler has said it will wait until Dec. 19 to tell customers because of a lack of replacement parts.

Shares of Fiat Chrysler were down 0.8 percent at $12.55 in morning trade on the New York Stock Exchange. They fell 0.4 percent in Milan.

(Reporting by Bernie Woodall; Editing by Lisa Von Ahn and Jonathan Oatis)