Fiat Chrysler Goes on a Cash-flinging Spree, Promises $4.5 Billion for Plants, 6,500 Michigan Jobs
Fiat Chrysler’s Tuesday announcement will surely make it the darling among domestic automakers, especially in the eye of a certain American president.
To fund the creation of new and next-generation models, most of them Jeeps, FCA is committing $4.6 billion to numerous Michigan plants, $1.6 billion of which will flow to Detroit’s Mack Avenue Engine Complex (soon to become a vehicle assembly plant). Among the vehicles funded with this promise are the long-awaited Jeep Wagoneer and Grand Wagoneer. Oh, and there’s another new Jeep on the way.
Another tidbit: FCA really likes the extra cash brought in by the old-generation Ram 1500 Classic. The model, seen above in Warlock trim, will soldier on.
It’s a long list, involving plenty of product shuffling, so here’s a brief overview of how the funding breaks down:
- $1.6 billion to convert Mack Avenue Engine Complex into an assembly site for the next-generation Jeep Grand Cherokee and what FCA describes as an “all-new three-row full-size Jeep SUV.” This would create 3,850 jobs.
- $900 million to retool and modernize Jefferson North for continued production of Dodge Durango and next-generation Jeep Grand Cherokee. Another 1,100 jobs created here.
- The roughly $1 billion Warren Truck plant investment announced in 2017 grows to $1.5 billion for production of the Jeep Wagoneer, Grand Wagoneer, and Ram 1500 Classic. Expect 1,400 new jobs.
- Sterling Stamping and Warren Stamping plants get $400 million to support additional production. Another 80 jobs might be created.
- $119 million to relocate Pentastar V6 engine production from Mack Avenue to the Dundee Engine Plant.
The automaker notes that all three vehicle assembly sites will build plug-in hybrid versions of the new Jeep models, “with flexibility to build battery-electric models in the future.” Each plant investments apparently hinges on land acquisition and the negotiation of juicy development incentives that FCA is sure to receive.
As for the models’ timeline, the mystery three-row Jeep should enter production by the end of 2020, with the next-gen Grand Cherokee coming online in the first half of 2021. Construction should start at Mack (future fendering above) by the end of the second quarter of 2019, FCA claims, with the engine shuffle taking place in Q3.
The Wagoneer and Grand Wagoneer — full-size models easily maxing out in the six-figure price range — should begin rolling out of Warren Truck in early 2021. Production of Ram’s temporary, gap-filling 1500 Classic is “being extended to meet market demand” — good news for cost-conscious truck shoppers still in love with the crosshair grille. Just how long we can expect the old Ram to linger on is unknown. (Probably until people stop buying them, or until a midsize model comes along.)
Because of the Classic’s new lease on life, Ram HD production will remain in Saltillo, Mexico, FCA says.
[Images: Fiat Chrysler Automobiles]
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- Merlyn I’m on my second Spark and love it! I can pass any car I’ve never had a problem going up a hill it does just fine. As for cargo I can fit three suitcases, two book bags and still have the front seat for a passenger. Not sure what point this guy is trying to make. I have hand free phone service and Sirius radio plug in my phone and have navigation. I would buy another spark in a heartbeat.
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- Jeanbaptiste Ever since y’all started sending your damn geese down here we’re just been waiting for one of you to show up.
- 3SpeedAutomatic Drove a rental Cherokee for several days at the beginning of this year. Since the inventory of rental cars is still low, this was a 2020 model with 48k miles and V6. Ran fine, no gremlins, graphics display was easy to work, plenty of power, & very comfortable. Someone must of disarmed the lane assistance feature for the steering wheel never shook (YES!!!!!!!!). However, this woman's voice kept nagging me about the speed limit (what's new!?!?!?!).I was impressed enough to consider this a prime candidate to replace my 11 yr old Ford Escape. Might get a good deal with the close out of the model. Time will tell. 🚗🚗🚗
With the 60-day deadline baked into the Mack Ave deal, I wonder how much of this is spin and FCA has announced a large package knowing only part of it will ever go through by design. That being said, if they're serious and the Mack Ave deal falls through, if Mary Barra wants to make some short-term cash, could she lease out one of the "unallocated" plants to Jeep for, say, 10 years?
" if they’re serious and the Mack Ave deal falls through, if Mary Barra wants to make some short-term cash, could she lease out one of the “unallocated” plants to Jeep for, say, 10 years?" I think FCA is serious. For years, Marchionne said he wanted to introduce the Grand Cherokee into more markets, but he couldn't get enough of them out of J-NAP. While other plants take summer and winter shutdowns, J-NAP keeps churning out GCs. The timing of the announcement, a week after GM extended D-Ham through the end of the year, makes me think FCA might have had it's eyes on D-Ham, but when the extension was announced, gave up waiting on GM and went ahead with this plan. I figure the extension of D-Ham is only a ploy to play off it's local against Grand River and Fairfax to see who GM can get the most concessions out of. If that's the case, Mary may have outsmarted herself. If they wind up closing D-Ham next year anyway, it will be too late to sell it to FCA, Ford is stagnant and has no need for another plant, no foreign automaker will want it as they will not want to deal with the union, so GM will be facing paying millions for demolition and cleanup.