Fiat Chrysler is investing heavily in five of its existing plants.
FCA announced its plans today to invest $4.5 billion in renovations to existing plants, as well as construction of a new assembly plant in Detroit. CEO Mike Manley made the announcement as the next step in the company’s strategy to grow its Jeep and ram brands. “It allows Jeep to enter two white space segments that offer significant margin opportunities and will enable new Jeep products, including at least four plug-in hybrid vehicles and the flexibility to product fully battery-electric vehicles.”
Jeep and Ram have both experienced upswing in demand, and FCA says this plan will create 6,500 new jobs. Models in the pipeline produced through the retooled plants will be the next-generation Jeep Grand Cherokee, a new, as-yet unnamed three-row SUV and several plug-in hybrid models.
Under the current plan, FCA will set aside $1.6 billion to renovate the Mack Avenue Engine Complex for those Jeep vehicles. The company says that renovation will create 3,850 new jobs to support production. If everything keeps to schedule, construction may start later in 2019, with the first three-row Jeeps expected to roll off the line in 2020. A new Jeep Grand Cherokee will follow in the first half of 2021.
The Jefferson North Assembly Plant will see $900 million to modernize the facility. The plant will add 1,100 jobs according to FCA. It will continue to serve as the production site for the Dodge Durango as well as the next-generation Jeep Grand Cherokee.
The all-new Jeep Wagoneer and Grand Wagoneer will be built at the Warren Truck Plant. To that end, FCA reaffirmed its commitment to add 1,400 new jobs to the plant, which currently builds the new Ram 1500 alongside the Ram 1500 Classic. Wagoneer and Grand Wagoneer production is slated to start in early 2021. As a result of the announcement, Ram Heavy Duty truck production will remain in Saltillo, Mexico, instead of moving to the Warren plant.
FCA also plans to use $119 million to move production of its Pentastar V6 engines from Mack I to the Dundee Engine Plant. Under the plan, Mack I would stop producing Pentastar engines by late 2019. The company also plans to invest $400 million to increase capacity at the Warren Stamping and Sterling Stamping plants, adding 80 new jobs in the process.
A time of restructuring
FCA can add a feather in its cap with this announcement, as it’s vowing to add jobs with continued investment in plants around Detroit. At the same time, General Motors is undergoing its own restructuring, ceasing production of underperforming models and cutting jobs in the U.S. and Canada. Ford, too, is undergoing its own massive restructuring in the coming months and years.
In the meantime, we’ll likely see the first signs of all-electric models from Jeep emerge. So, too, will we see Ram continue to gain ground on Ford and General Motors in the truck market.