DETROIT – Fiat Chrysler announced Tuesday that the company is planning to build a new assembly plant in Detroit and invest $4.5 billion into five of its existing Michigan plants.
The proposed projects would create nearly 6,500 new jobs and meet growing demand for its Jeep and Ram brands, FCA officials said.
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The move includes the planned production of two new Jeep white space products and electrified models, FCA officials announced.
Tuesday's announcement is the latest step in a realignment that FCA began in 2016. As customer demand shifted toward SUVs and trucks, the company discontinued car production and retooled plants in Michigan, Illinois and Ohio to expand the Jeep and Ram brands.
"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, CEO of FCA N.V. "Today’s 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."
Detroit officials have 60 days to meet the terms of a memorandum of understanding, which requires the acquisition of property critical to the execution of a Mack Avenue Eingine Complex project, FCA officials said. The additional investments are subject to that negotiation, FCA officials announced.
FCA would invest $1.6 billion to convert the two plants that make up the Mack Avenue Engine Complex into the future assembly site for the next generation Jeep Grand Cherokee and a three-row, full-size Jeep SUV and plug-in hybrid, adding 3,850 jobs to support production, FCA officials said.
The company plans to start construction of the new Detroit facility by the end of the second quarter in 2019, with the first three-row vehicles expected to roll off the line by the end of 2020 and the new Grand Cherokee in the first half of 2021.
The North Assembly Plant would receive an investment of $900 million to retool and modernize the facility to build the Dodge Durango and next generation Jeep Grand Cherokee, which would create 1,100 new jobs at the plant, FCA officials announced.
The reborn Mack facility would be the first new assembly plant built in Detroit in nearly three decades, FCA officials said.
Statements on FCA announcement
Here are some statements released by officials and companies about this FCA announcement.
Macomb County Executive Mark Hackel:
"Once again, Macomb County is at the epicenter of the evolution of the auto industry. FCA’s announcement of $1.9 billion dollars of investment and nearly 1,500 new jobs at Warren Truck, Warren Stamping and Sterling Stamping showcases the company’s future-focused strategy. It is also a testament to the abilities of our talented workforce, who will now be charged with building exciting new products and advancing automotive technology and capabilities. Thank you Mike Manley, FCA and their talented workforce for believing in Michigan."
UAW Vice President Cindy Estrada:
"I look at today’s investment as a reward for the efforts of our membership and a show of confidence that the members of the UAW are the best auto workers in the world. This is especially exciting given that these are good union jobs with union wages and benefits that have been collectively bargained for with the company. We also look forward to collaborating with FCA, the City of Detroit and other community leaders on a Community Benefits Agreement that re-imagines our city and empowers our citizens to create sustainable communities with long term viability."
Congressman Paul Mitchell:
"I was thrilled to hear that Fiat Chrysler Automobiles (FCA) plans to invest further in its Michigan manufacturing operations, especially at the Sterling Stamping Plant in Michigan’s 10th Congressional District - currently the world’s largest automobile part stamping plant. FCA’s realignment over the last two years to build more of its new SUVs and Ram trucks in Michigan has added millions of dollars to our economy, and has created hundreds of well-paying jobs for my constituents."
Congresswoman Haley Stevens:
“Betting on Michigan’s best-in-class workforce is always a smart decision. I am thrilled to hear that FCA is investing in Michigan and creating thousands of new jobs in the process. Michigan is a global leader in technology and innovation in the auto industry and there is no better place for FCA’s investment in modernization and electrification.”
Wayne County Executive Warren C. Evans:
"Today’s announcement of a multibillion dollar investment at Mack and Jefferson North, along with the creation of nearly 5,000 new jobs, demonstrates that FCA emerged from the bankruptcy era poised to be a leader in the budding mobility sector. Detroit and Wayne County have rebounded on a similar trajectory as FCA so this partnership is a natural fit. I applaud FCA’s commitment to Detroit and Wayne County, and their continued investment in the city amid the automotive industry’s daunting pace of change."
Congresswoman Rashida Tlaib:
"Fiat Chrysler is making the right move in bringing more jobs to the city of Detroit and the Metro Detroit region. You won't find a better host community. My only hope is that we not just focus on jobs, but also opportunities for the nearby neighborhoods to thrive with this expansion. I urge Fiat Chrysler to consider a real community benefits agreement that addresses the need for programs for youth, increases home ownership, reduces carbon emissions, among other needed initiatives. This will ensure a true win-win development for all those impacted. This is a tremendous opportunity for Fiat Chrysler to do development differently than those in the past by being inclusive and rooting this project in uplifting the needs of as many neighbors as possible."