FCA Announces Massive Investment
Fiat Chrysler Automobiles (FCA) is investing a total of $4.5 billion in already existing Michigan plants. FCA is going to work with the city of Detroit and the state of Michigan to build a new assembly plant. When it’s ready to open it will increase the growing demand for its Jeep and RAM brands as well as Jeep-branded white space products and electrified models.
“Three years ago, FCA set a course to grow our profitability based on the strength of the Jeep and RAM brands by realigning our U.S. manufacturing operations,” said Mike Manley, Chief Executive officer for FCA “(the announcement) 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.”
Details for the plant actions began back in 2016. The expansion on the available capacity to expand the Jeep and RAM brands is in response to the shift in consumer demand toward SUVs and trucks. The project proposals would create nearly 6,500 new jobs.
The expansion has resulted in the recent launches of the award-winning all-new Jeep Wrangler and all-new RAM 1500. It also introduced a new member to the Jeep family. At the 2018 Los Angeles Auto Show was the all-new Jeep Gladiator.
PLANT INVESTMENT DETAILS
With the plan to expand, FCA would invest $1.6 billion to convert the two plants that consist of the Mack Avenue Engine Complex into the future assembly site for the next generation Jeep Grand Cherokee. Other designs will include an all-new three-row full-size Jeep SUV and plug-in hybrid (PHEV) models, adding 3,850 new jobs to support production. Yes, even hybrids are getting a space.
The company is working fast so that the vehicles can be done sooner rather than later. Construction of the new Detroit facility will be ready by the end of 2019. They want the first three-row vehicles to roll off the by the end of 2020, which will come after the all-new Grand Cherokee in the first half of 2021.
The Pentastar engines – the 3.6-, 3.2- and 3.0-Liter – which are currently built at Mack I will also be relocated to a new location, the Dundee Engine Plant as part of a $119 million investment. The Pentastar production at Mack I would end by Q3 2019. Mack II has been pointless since it ceased production of the 3.7-liter V-6 in September 2012, according to advancedmanufacturing.org
Another production is expected to launch in early 2021, and it’s for the all-new Jeep Wagoneer and Grand Wagoneer, which was announced in 2017, along with their electrified counterparts. The plant will continue building the Ram 1500 classic, in addition to the new Jeep models, so that the Ram 1500 can meet the market demand. Production on the all-new Ram Heavy Duty will continue at its current location in Saltillo, Mexico, as a result of this investment announcement.
For the additional production, the Company’s Warren Stamping (Warren, Michigan) and Sterling Stamping (Sterling Heights, Michigan) plants would receive investments of $245 million. Respectively, Sterling Stamping will receive $160 million, and it’s expected to add more than 80 jobs. The investment is part of the Company’s capital spending plan presented in June of 2018.
REALIGNMENT OF FCA U.S. MANUFACTURING OPERATIONS
Over the past two years, the investments have included $350 million in the Belvidere Assembly Plant (Illinois) to produce the Jeep Cherokee. To produce the next-generation Jeep Wrangler FCA has a $700 million budget in the Toledo Assembly Complex (Ohio). Production of the next-generation Ram 1500 truck began in March 2018 and production of the Ram 1500 Classic continues at Warren Truck (Michigan). The all-new Jeep Gladiator, which has a $273 million investment, is scheduled to launch in the first half of 2019.
If you’re interested in test-driving a Jeep model, make sure to check them out at the Cape Coral Chrysler Dodge Jeep RAM dealership.
Photo Credit: advancedmanufacturing.org