Fiat Chrysler Confirms New $1-Billion Investment In Michigan and Bonus Pay

Lots of smiles to go around in the Michigan automotive market thanks to news Thursday from Fiat Chrysler Automobiles — FCA — regarding plans to invest more than $1-billion to modernize the Warren Truck Assembly Plant in order to produce the next-generation Ram Heavy Duty truck, which will relocate from its current production facility in Saltillo, Mexico in two years.

That was one of two major announcements from FCA made possible in part by the passage of U.S. tax reform legislation late last year. In addition to additional investments in U.S. manufacturing operations, the automaker revealed plans for a special payment to recognize employees for their continued efforts toward the success of the company.

FCA confirmed the major investment at Warren, adding it is in addition to the announcement made a year ago in January 2017, which committed to spending a portion of $1 billion in Warren Truck Assembly to expand the Jeep product line with the addition of the all-new Jeep Wagoneer and Grand Wagoneer. The Saltillo Truck Assembly Plant will be re-purposed to produce future commercial vehicles for global distribution.

Better yet for Michigan, in order to support the increased volume at the Warren facility, 2,500 new jobs will be created, above and beyond the jobs announced as part of the January 2017 announcement.

The company also confirmed that it will make a special bonus payment of $2,000 to approximately 60,000 FCA hourly and salaried employees in the U.S., excluding senior leadership. The payment, which recognizes employees for their continued commitment to the company’s success, will be made in the second quarter of this year, and will be in addition to any profit sharing and salaried performance bonuses that employees would otherwise be eligible to receive in 2018. The special bonus will be paid to all eligible employees of the FCA automotive and components operations in the U.S.

FCA Chief Executive Officer Sergio Marchionne says, “These announcements reflect our ongoing commitment to our U.S. manufacturing footprint and the dedicated employees who have contributed to FCA’s success.” He adds, “It is only proper that our employees share in the savings generated by tax reform and that we openly acknowledge the resulting improvement in the U.S. business environment by investing in our industrial footprint accordingly.”

FCA has invested $10 billion in its U.S. manufacturing operations since June 2009. Most recently, the company announced investments totaling $3.5 billion, with the addition of 3,700 new jobs, to strengthen its U.S. manufacturing base, and align U.S. capacity to extend the Jeep and Ram product lines.

Those investments and related actions involved production shifts at three plants in Illinois, Ohio and Michigan to gain capacity for the Jeep Cherokee, Jeep Wrangler and Ram Light Duty truck, and the introduction of three new Jeep models at plants in Ohio and Michigan.

The investments include:

  • $350 million in the Belvidere Assembly Plant (Illinois) to produce the Jeep Cherokee, which moved from Toledo, Ohio, in 2017. More than 300 new jobs were added to support production.
  • $700 million in the Toledo Assembly Complex (Ohio) to retool the North plant to produce the next-generation Jeep Wrangler. Approximately 700 new jobs will be added to support production.
  • $1.5 billion in the Sterling Heights Assembly Plant (Michigan) to build the next-generation Ram 1500 truck. More than 700 new jobs will be added to support production.
  • $1 billion in the south plant of the Toledo Assembly Complex to prepare the facility to produce an all-new Jeep truck, and in the Warren Truck Assembly Plant to modernize the plant to build the all-new Jeep Wagoneer and Grand Wagoneer. More than 2,000 new jobs will be added at these two plants to support production.

The plant investment actions announced Thursday are subject to the negotiation and final approval of incentives by state and local entities.

Fiat Chrysler Automobiles is the seventh-largest automaker in the world based on total annual vehicle sales.