The first thing Doug Betts did when he arrived at Chrysler LLC in October 2007 to oversee quality was define the term so everyone would be on the same page to fix problems.

The Auburn Hills automaker had not scored well in quality surveys, which has been costly in terms of lost sales.

Betts noted similarities to problems he encountered as a troubleshooter at Nissan Motor Co. following poor product launches in 2003. Months of brainstorming at Nissan became Chrysler's gain, as Betts said he knew within days of arriving what needed to be done at Chrysler.

"The people at Chrysler were very open to trying something different," said Betts, an engineer who spent a decade at Toyota Motor Corp. before Nissan.

There are roughly the same number of people working on quality at Chrysler today, but they are organized in 18 cross-functional teams of about eight people each, instead of by department.

The teams are organized around parts of the car with goals to fix problems immediately. Time is not wasted arguing over whose problem it is, he said.

There are signs Betts' changes are working. Chrysler recalled the fewest vehicles among the six major automakers last year, 361,065, according to the National Highway Traffic Safety Administration.

Ford Motor Co. recalled 1.6 million vehicles, General Motors Corp. 1.8 million, Honda Motor Co. almost 800,000 and Toyota Motor Corp. 833,000. Chrysler was the No. 4 automaker in the United States last year, selling 1.5 million vehicles, behind GM, Toyota and Ford.

Chrysler's recall performance last year marked an improvement over 2007, when the automaker recalled 576,418 vehicles, more than GM and just shy of Toyota's tally.

Also, according to Chrysler's internal data, the number of warranty claims after three months' ownership improved 21 percent in the last four months of 2008, contributing to a 30 percent improvement last year compared to 2007. For consumers, that means almost a third fewer visits to the dealer for repairs, Betts said. For Chrysler, it reduced warranty costs by $240 million in 2008.

But Chrysler, battling to survive amid the worst sales downturn in the U.S. auto industry in decades, still has to convince consumers it builds better vehicles than it used to.

"Perception will lag the improvement for a long time, even if they are making strides," said Stephanie Brinley, product analyst with AutoPacific in Troy. "It takes two (product) life cycles for consumers to truly understand there is a difference."

Betts is quick to acknowledge that consumers rely on third-party evaluations such as Consumer Reports' reliability reviews, which rate automakers against the industry average, and that Chrysler has consistently failed to meet the industry average. For the 2008 model year, Chrysler vehicles were "quite a bit worse," said Betts, who came into the job knowing quality has recently been Chrysler's Achilles heel.

Early indications from testing the 2009 Dodge Ram, one of the company's flagship vehicles, show improved quality, especially for interior materials, which "are much higher grade and look better," said Jonathan Linkov, managing editor of autos at Consumer Reports.

But similar upgrades are needed across the lineup, he said, especially extending to bread-and-butter vehicles such as the Chrysler Sebring and Dodge Avenger midsize cars and the smaller Dodge Caliber and Jeep Compass and Patriot, which were launched with hard plastic interiors and poorly placed panel gaps.

"They are a good example of bad interior execution," Linkov said, although he acknowledged improvements to the Jeep interiors for 2009.

Linkov noted that poor quality vehicles were launched during Daimler AG's ownership of Chrysler but quality has improved since Cerberus Capital Management LP assumed a majority share of Chrysler in 2007.

They are still not Toyota quality, but are better than past Chrysler products, Linkov said.

The question now is whether Chrysler's limited resources -- the automaker is trying to stave off bankruptcy by cutting costs and relying on federal loans -- will be directed at new products or to redo existing ones, Linkov said.

Consumers Reports makes recommendations based on a three-year window of reliability, so Betts knows there won't be any grand declarations after one good year.

But he is confident things will continue to improve.

"Every month for the next few months," he said, "I'm going to be saying we've set a new warranty record."