Fiat Chrysler Automobiles (NYSE:FCAU) have announced they will be investing $1 billion in the Ohio and Michigan factories in the United States. This would be the second phase of their industrialization plans, one which is likely to create 2,000 jobs. The first phase was announced in the January of 2016 where the company said they will realign manufacturing operations because the demand has shifted to SUVs and trucks.
However, the deal will only be finalized once the incentives the business receives from the local and state governments are finally approved.
With this announcement, the total amount of Fiat Chrysler’s investments in US production facilities comes to $9.6 billion since 2009.
Fiat Chrysler’s Plans for Michigan and Ohio
Fiat Chrysler now says with this fresh investment, the Warren Truck Assembly Plant in Michigan will be retooled to make the Grand Wagoneer and Jeep Wagoneer vehicles. Also, the Toledo Assembly Complex in Ohio will be able to make their new Jeep pickup trucks once the retooling is carried out, which will be sometime by 2020. It was learned that the Ram heavy duty truck will also be made at the company’s Michigan plant. At this time, this truck is being produced at Saltillo in Mexico. It is unclear what will happen to the 11,800 workers the company employs in Mexico.
So, Fiat Chrysler will be moving that production from across the border, which Trump has been urging the automakers to do.
A few months back, Fiat Chrysler (NYSE:FCAU) had said they will be investing $350 million in the Belvidere Assembly Plant in Illinois to make the Jeep Cherokee, which is currently being made at Toledo. They also announced the decision to invest $700 million in Toledo for making the next-gen Jeep Wrangler.
Sergio Marchionne, the CEO said, “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”.
Trump’s Tweet About Fiat and Ford
Trump was naturally happy with these announcements, and also Ford’s (NYSE:F) decision to cancel their $1.6 billion Mexico factory, and invest $700 million in Michigan production facilities. “It’s finally happening. Thank you Ford & Fiat”, he tweeted.
In response, the Fiat Chrysler CEO tweeted, “I thank him. We owed the country this investment.”