Putting speculation to rest, FCA announced today it is spending $1 billion to retool plants in Michigan and Ohio to make the Jeep Wagoneer, Grand Wagoneer, and a Jeep pickup by 2020.
The move adds 2,000 jobs in the U.S. at plants in Warren, Mich., and Toledo, Ohio. It is part of a massive reorganization of what FCA makes and where, a plan announced in January 2016 that is being executed over a number of years. This is part of the second phase and reflects FCA’s emphasis on trucks and SUVs as it downsizes its car lineup.
The Warren truck plant currently makes Ram pickups but the trucks are moving to the Sterling Heights plant in Michigan and Warren is being retooled to make add an all-new Jeep Wagoneer and Grand Wagoneer at the top of the Jeep lineup, competing with high-line Land Rovers. Warren will also make the Ram heavy-duty pickup in the future–it is currently assembled in Mexico.
Jeep will add a pickup in Toledo.
It is the latest announcement by a U.S. automaker to keep jobs in the U.S. in the wake of a campaign of tweet-shaming by President-elect Donald Trump. Ford recently cancelled plans for a $1.6 billion new plant in Mexico and instead announced an increased investment in the U.S., although it did not not change plans to build its small cars in Mexico.
“The conversion of our industrial footprint completes this stage of our transformation as we respond to the shift in consumer tastes to trucks and SUVs, and as we continue to reinforce the U.S. as a global manufacturing hub for those vehicles at the heart of the SUV and truck market,” said Sergio Marchionne, FCA’s CEO, in a statement, noting he has worked with the UAW on the plans.
“The expansion of our Jeep lineup has been and continues to be the key pillar of our strategy,” Marchionne said. The dates reflect a delay from original plans to launch the Grand Wagoneer but confirm the high-end SUV is still coming after reports suggesting it had been cancelled.
Marchionne said the plant moves means FCA “will finally have the capacity to successfully penetrate markets other than the U.S. which have historically been denied product due to capacity constraints.”
FCA is negotiating government incentives for the investment.
The automaker already said it is spending $1 billion to ready its plant in Belvidere, Illinois, to make the Jeep Cherokee this year (fit is currently made in Toledo). Then the Toledo plant will be retooled to produce the next-generation Jeep Wrangler.
And FCA is spending nearly $1.5 billion in its Sterling Heights plant in Michigan to make the next-generation Dodge Ram after it is moved out of Warren Truck.