Fiat Chrysler Automobiles N.V. has confirmed plans to invest a total of US$4.5 billion 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 city limits.
The move would increase capacity to meet growing demand for its Jeep and Ram brands, including production of two new Jeep-branded white space products, as well as electrified models. The proposed projects would create nearly 6,500 new jobs.
The plant actions detailed in the announcement represent the next steps in a U.S. manufacturing realignment that FCA began in 2016. In response to a shift in consumer demand toward SUVs and trucks, the Company discontinued compact car production and retooled plants in Illinois, Ohio and Michigan to make full use of available capacity 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, chief executive officer, 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.”
The city of Detroit has 60 days to meet the terms of a Memorandum of Understanding, which requires the acquisition of property critical to the execution of the Mack project. The additional investments are subject to the successful negotiation and final approval of development packages with the state and other local governments.