Fiat Chrysler Plans Michigan Investment With 6,500 Jobs
As General Motors and Ford are cutting jobs and production, Fiat Chrysler Automobiles is heading in the opposite direction.
On Tuesday, the Italian-American automaker said it planned to spend $4.5 billion over the next three years to update several Detroit plants and retool an engine plant to make Jeeps, an effort the company said would create about 6,500 new jobs.
The announcement comes as analysts are forecasting declines in auto sales in the United States this year and next. But Mike Manley, Fiat Chrysler’s chief executive, said he was confident that the American economy would remain on track. “The economic indicators as we see them are still strong,” he said in a conference call with reporters.
He also noted that the updated plants would produce three large Jeep models — vehicles that are experiencing growth as consumers gravitate toward sport-utility vehicles and increasingly abandon sedans. The plan, Mr. Manley said, “is an investment in Jeep as our core brand.”
Fiat Chrysler intends to convert its Mack Avenue Engine plant in Detroit to produce a new seven-passenger Jeep model and the new version of its Jeep Grand Cherokee, a move that will add 3,850 jobs. Mr. Manley said construction would start in the second quarter. Plans for the plant’s conversion had surfaced in news reports in December.
The company will also update another Detroit plant, known as Jefferson North, to be able to make the next-generation Grand Cherokee as well as the Dodge Durango, another S.U.V., creating 1,000 additional jobs. A third plant in Warren, Mich., that currently makes an older version of the Ram 1500 pickup truck will be modified to also make two other new vehicles — the Jeep Wagoneer and Grand Wagoneer. That will bring 1,400 jobs to the Warren factory.
Mr. Manley said the plant modifications will allow Fiat Chrysler to start making electric versions of its Jeep models, if customer demand increases.
Fiat Chrysler was ahead of most of its competitors when it stopped making sedans in 2016 to focus on pickups, S.U.V.s and other large vehicles, whose sales were rising as gasoline priced declined. G.M. and Ford are now scrambling to catch up.
G.M. last year announced that it would close two plants in the United States and a third in Canada that make cars. Ford said last year that it would stop making sedans, and is undergoing a broad restructuring to improve profitability. Both G.M. and Ford are eliminating thousands of salaried jobs as part of their cost-cutting efforts.