Fiat Chrysler Automobiles (FCA) has recently revealed the group’s plans to invest a whopping amount of $4.5 billion in its 5 existing manufacturing facilities in Michigan, and to work on a new assembly facility within the city limits of Detroit. FCA has taken this decision of making this big investment in order to augment the production capacity to meet the growing demands for its Jeep and Ram brand models. This production capacity increase will also cater to the production of the two new Jeep-maintream SUV models and electrified models as well. These big scale upcoming projects are also expected to create around 6,500 new jobs.
However, the more interesting part of this news is the fact that Fiat Chrysler Automobiles would be investing $1.6 billion in order to convert its two facilities, which comprise of the Mack Avenue Engine Complex into an assembly plant for the next generation Jeep Grand Cherokee. This same facility will also be responsible for rolling out an all-new full-sized 3-row Jeep SUV as well as plug-in hybrid models. This new facility will be creating job opportunities of around 3,850 in order to support production process. FCA is planning to commence setting-up of this new Detroit plant by the end of the first half of this year. The first three-row vehicles are likely to be rolled off from this facility by the end of 2020, which will be followed by the next generation Grand Cherokee that is expected to come sometime around the first half of 2021.
This announcement represents the Italian-American automobile group’s ongoing work to realign its U.S. manufacturing facilities, which the company started back in 2016. FCA took a major decision in response to the consumer demand shift towards SUVs and pick-up trucks, and discontinued the production of the compact car models. FCA also re-equipped its plants in Illinois, Ohio and Michigan in order to utilize these plants’ full production capacity to expand the productions for the Jeep as well as Ram brands.
While confirming the developments, the Chief Executive Officer of FCA N.V. Mike Manley said that this announcement represents the upcoming steps in the company’s strategy. This decision will allow Jeep brand to enter two white space segments and the development of new electrified Jeep products, which includes 4 plug-in hybrid models, while also offering the flexibility to produce fully battery operated electric vehicles.
As part of this strategic development, the Jefferson of the North Assembly Plant will also receive an investment of a lump sum amount of $900 million in order to reequip and update the plant to build the Dodge Durango and the next generation Jeep Grand Cherokee models. The company is expecting to create around 1,100 new jobs at Jefferson North plant.
In the last two years, FCA has realigned the production at four of its facilities in Illinois, Ohio as well as in Michigan in order the ramp up the production capacity for the Jeep Cherokee, Jeep Wrangler and Ram 1500 truck, while the company also created added manufacturing capacity for the Jeep Gladiator at the Ohio plant.