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Jeep Grand Cherokee Moves to RWD Alfa Platform

$1-billion U.S.-plant investment made before Trump’s election

The next Jeep Grand Cherokee will replace its aged Mercedes-Benz-based platform with Alfa Romeo’s new platform, which helps to amortize the midsize architecture developed to return the Italian brand to rear wheel drive. The revelation came in a question to FiatChrysler CEO Sergio Marchionne about the future of the Alfa platform’s heretofore costly, delayed model development in light of the automaker’s announcement it will spend $1 billion to retool and modernize the Warren Truck Assembly plant for the upcoming body-on-frame Jeep Wagoneer and Grand Wagoneer models, and the South plant at Toledo, Ohio, for assembly of the new Jeep Wrangler pickup truck. The investment moves some Ram heavy-duty pickup truck production to Warren, Michigan, from Toluca, Mexico.

Marchionne also confirmed that the next-generation Dodge Charger and Challenger are still planned for the Alfa platform, which has just made its debut in the new compact Giulia sedan. It will also be used to underpin the Alfa Romeo Stelvio sport/utility vehicle.

“The Grand Cherokee will need a new architecture,” Marchionne said. The plan has the bestselling Jeep moving to the Alfa RWD platform (with optional four-wheel-drive and all-wheel-drive systems, obviously) “unless something happens in the next 60 days,” he said at a press conference at the North American International Auto Show here. The plan, if approved by FiatChrysler’s upper management, would keep Jeep Grand Cherokee production in the U.S.

Under Marchionne’s last five-year plan, released in 2014, the Jeep Grand Cherokee was due for redesign in time for the 2019 model year. If management hasn’t confirmed the new model’s platform, it suggests the replacement is probably more than two model years away.

FiatChrysler’s $1 billion investment, announced Sunday, has been in the works for a year, Marchionne said at his annual NAIAS press conference, and had nothing to do with Donald Trump’s tweets criticizing other automakers for their small car production in Mexico.

“The decision has been in the works for a long period of time,” Marchionne said. FiatChrysler has been in talks with United Auto Workers president Dennis Williams since 2015, he said.

“This move is totally consistent with what we made 12 months ago.”

The move was not “technically feasible” Marchionne said, “until we could free up Warren.” The nearby Sterling Heights, Michigan plant, which has assembled the Chrysler 200 will take work from Warren in order to free up that assembly plant for the Ram heavy-duty.

Asked whether FiatChrysler will move any other production out of Mexico in light of the president-elect’s threats to renegotiate the North American Free Trade Agreement (NAFTA) and potentially add a 35-percent tariff to cars and trucks imported north across the border, Marchionne said, “I don’t know how to answer a question like that. It’s new territory for all of us. We’ve never had a tweeting president before.”

FiatChrysler will wait until such potential changes become law, Marchionne said.

“There’s nothing to moralize,” he added. “We’re carmakers.”

He also declined to say whether he would accept or reject contracted production of Chrysler 200 and Dodge Dart replacements from a foreign plant with low labor costs. Such production is necessary for automakers’ balance sheets, because small and midsize cars have very thin profit margins.

For now, FiatChrysler appears to be moving away from the auto business in favor of more Jeeps and Rams, with no apparent replacement in sight for the Chrysler 300, for example. When any automaker, especially one as tight on capital as FiatChrysler makes a $1-billion investment in one set of products, it typically means that other future products have been cancelled or put on hold.

Covering other subjects, Marchionne said FiatChrysler will rely on Google’s Waymo to provide the technology for its non-exclusive autonomous car-testing program using the Chrysler Pacifica minivan, and predicted that Level 4 autonomy would become commonplace by the early ‘20s.

“Our objective is to work with Google to see how far we can take this,” he said.

 

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