Chrysler is plowing $1.48 billion into the Sterling Heights Assembly plant to ready it for Ram 1500 production early next year.
The transformation of Fiat Chrysler’s North American production footprint continued forward today with the announcement of $1.48 billion in upgrades to one of its suburban Detroit plants.
FCA is moving all of its car production out of the country and concentrating its U.S. manufacturing resources on its highly profitable truck and utility line-ups. The Sterling Heights (Mich.) Assembly Plant currently builds the Chrysler 200 sedan, but after the changes, it will make the Ram 1500 pickup truck.
Chrysler 200 production will end in December, at which point, the company will begin work on the changeover. The announcement follows the company’s first step: a $1 billion overhaul of plants in Toledo, Ohio, and Belvidere, Illinois.
Additionally, the company is moving the Ram 1500 to the Sterling Heights facility from its Warren Truck plant just a few miles south. However, it has declined repeatedly to say what will be going into the Warren plant.
Speculation about the new product for the massive plant is that it will build the new Wagoneer and Grand Wagoneer. In the meantime, FCA also said it plans to invest $700 million to retool the Toledo Assembly Complex. According to the company’s plans, the Toledo North plant will produce the next generation Jeep Wrangler for global distribution, which will add about 700 new jobs.
(FCA investing $1 billion to retool plants in Ohio, Illinois. For more, Click Here.)
Fiat Chrysler's Sterling Heights Assembly Plant will stop producing the Chrysler 200 in December.
The new Wrangler is now expected to begin production in 2018. The Toledo complex is also expected to build a compact pickup truck based on the Wrangler, which has been all but confirmed officially by the company’s top executives.
The Belvidere Assembly plant in Belvidere, Illinois, west of Chicago, will receive an investment of $350 million to produce the Jeep Cherokee, which will move from its current production location in Toledo, Ohio, in 2017. Approximately 300 new jobs will be created.
Production of the Dodge Dart, which is now built at FCA’s assembly plant at Belvidere, and the Jeep Compass/Jeep Patriot will end in September 2016 and December 2016, respectively.
Production of the Compass/Patriot are being moved to Mexico while the fate of the Dart has been left in limbo as the Illinois-based plant is re-tooled to build a new generation of pickup trucks.
(FCA expects Wagoneer to stand apart … literally. Click Here for the story.)
Marchionne said back in January that he planned to overhaul the company’s production capacity to follow the current market trends and build more truck and utility vehicles.
During the first half of 2016, truck and utility vehicles accounted for 57.8% of the vehicles sold in the United States during the first half of 2016, compared to 53.8% in the first six months of 2015, according to Auto Data.
Some 72.2% of the vehicles sold by FCA were trucks and utility vehicles, compared with 66% in first half of 2015, according to the company’s own sales numbers.
(Jeep climbing to another record sales year. For details, Click Here.)
Marchionne is also pushing ahead with a rapid expansion of the Jeep brand, which is expected to set another sales record this year as it expands into new markets and new market segments.