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Fiat Chrysler to build new assembly plant in Detroit, bring 4,000 jobs to city

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Posted at 11:02 AM, Feb 26, 2019
and last updated 2019-02-26 13:10:21-05

DETROIT (WXYZ) — Detroit Mayor Mike Duggan has announced a new Fiat Chrysler plant is coming to the city, along with nearly 4,000 new jobs.

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The new assembly plant will be built on Mack and St. Jean. This will be the first new assembly plant to be built in Detroit in almost three decades, and will be a $1.6 billion investment.

In total, the company is investing $4.5 billion into the new plant and five existing Michigan plants, and will create 6,500 new jobs in the metro Detroit area.

Fiat Chrysler said in a news release that it would add another 1,100 new jobs at its Jefferson North Assembly plant, and roughly 1,500 new jobs at facilities in the neighboring suburb of Warren.

The average wage for the new jobs coming to Detroit are $58,000, according to Duggan.

"These are the kinds of jobs we need to bring back to the city," he added.

Detroit has 60 days to assemble 200 acres of land where Fiat Chrysler can implement its expansion.

A memorandum of understanding signed Tuesday between Detroit and the automaker outlines terms of the deal.

Mayor Mike Duggan says the land will have to be bought with the cooperation of landowners because the government can no longer use eminent domain powers for auto plant projects.

Under the plan, Fiat Chrysler said it would reopen a shuttered engine plant in Detroit and convert another in the same complex into a future assembly plant for the Jeep Grand Cherokee and a new, three-row, full-size Jeep SUV and plug-in hybrid models for all.

The mayor says talks about the new plant started with former CEO Sergio Marchionne.

"Three years ago, FCA set a course to grow our profitability based on the strength of the Jeep and Ram brands by realigning our U.S. manufacturing operations,” said Mike Manley, Chief Executive Officer, FCA N.V. “Today’s announcement represents the next step in that strategy. It allows Jeep to enter two white space segments that offer significant margin opportunities and will enable new electrified Jeep products, including at least four plug-in hybrid vehicles and the flexibility to produce fully battery electric vehicles.”

“I look at today’s investment as a reward for the efforts of our membership and a show of confidence that the members of the UAW are the best auto workers in the world," said UAW Vice President Cindy Estrada. "This is especially exciting given that these are good union jobs with union wages and benefits that have been collectively bargained for with the company. We also look forward to collaborating with FCA, the City of Detroit and other community leaders on a Community Benefits Agreement that re-imagines our city and empowers our citizens to create sustainable communities with long term viability.”

KEY POINTS:

* Investment would be next step in Company’s U.S. industrialization plan, announced in 2016 to expand Jeep® and Ram brands

* Introduces two new Jeep branded “white space” products in key market segments

* Enables electrification of new Jeep models

* $1.6 billion investment would convert Mack Avenue Engine Complex into manufacturing site for next generation Jeep Grand Cherokee and an all-new 3-row full-size Jeep SUV, creating 3,850 new jobs

* $900 million investment at Jefferson North to retool and modernize plant for continued production of Dodge Durango and next generation Jeep Grand Cherokee with 1,100 new jobs expected

* Warren Truck 2017 investment increases to $1.5 billion for production of all-new Jeep Wagoneer and Grand Wagoneer as well as continued assembly of Ram 1500 Classic with addition of 1,400 new jobs

* All three assembly sites would also produce plug-in hybrid versions of their respective Jeep models with flexibility to build fully battery electric models in the future

* Sterling Stamping and Warren Stamping plants to receive more than $400 million total investment to support additional production, potentially creating about 80 new jobs at Sterling

* $119 million investment to relocate Pentastar engine production currently at Mack I to the Dundee Engine Plant; production at Mack would end by Q3 2019

* Projects contingent on land acquisition and the negotiation of development incentives with the cities of Detroit, Sterling Heights, Warren, Dundee and state of Michigan

* City of Detroit has 60 days to deliver on commitments outlined in Memorandum of Understanding related to Mack and Jefferson North projects