Fiat Chrysler Automobiles (FCA) has confirmed plans to invest a total of US$4.5bn in five of its existing Michigan plants, and to work with the city of Detroit and state of Michigan on building a new assembly plant within the city limits.
The move will increase the OEM’s capacity to meet growing demand for the Jeep and Ram lines, including electrified models. The proposed projects would create nearly 6,500 new jobs.
The plant announcement is the latest step in FCA’s US manufacturing realignment that the company began in 2016. FCA has discontinued compact car production and retooled plants in Illinois, Ohio and Michigan to make full use of capacity to expand the Jeep and Ram lines – including the recent launches of the all-new Jeep Wrangler and Ram 1500, and the introduction of the new Jeep Gladiator.
“Three years ago, FCA set a course to grow our profitability based on the strength of the Jeep and Ram brands by realigning our US manufacturing operations,” said Mike Manley, CEO of FCA.
“Today’s announcement (February 26) represents the next step in that strategy. It allows Jeep to enter two white space segments that offer significant margin opportunities and will enable new electrified Jeep products, including at least four plug-in hybrid vehicles and the flexibility to produce fully battery-electric vehicles.”
FCA plans to invest US$1.6bn to convert the two plants comprising the Mack Avenue Engine Complex into the future assembly site for the next-generation Jeep Grand Cherokee, as well as a new three-row full-size Jeep SUV and PHEV models, adding 3,850 new jobs to support production.
FCA plans to start construction of the new Detroit facility by the end of Q2 2019 with the first three-row vehicles expected to roll off the line by the end of 2020, followed by the all-new Grand Cherokee in the first half of 2021.
In addition, the Jefferson North Assembly Plant will receive an investment of US$900m to retool and modernize the facility to build the Dodge Durango and next-generation Jeep Grand Cherokee. FCA expects to create 1,100 new jobs at Jefferson North.
The Pentastar engines – the 3.6-, 3.2- and 3.0-liter – currently built at Mack I will be relocated to the Dundee Engine Plant as part of a US$119m investment. Pentastar production at Mack I is scheduled to end by Q3 2019. Mack II has been idle since it ceased production of the 3.7-liter V-6 in September 2012.
FCA also confirmed planned investment at Warren Truck – to retool for production of the all-new Jeep Wagoneer and Grand Wagoneer, announced in 2017, along with their electrified counterparts – would increase to US$1.5bn. Production is expected to begin in early 2021.
In addition to the new Jeep models, the plant will continue building the Ram 1500 Classic, which is being extended to meet market demand. An expected 1,400 new jobs will be added. As a result of this investment announcement, production of the all-new Ram 1500 Heavy Duty will continue at its current location in Saltillo, Mexico.
FCA’s Warren Stamping (Warren, Michigan) and Sterling Stamping (Sterling Heights, Michigan) plants are to receive investments of US$245m and US$160m respectively, with Sterling Stamping expected to add more than 80 new jobs.