Fiat Chrysler Automobiles said it plans to invest a total of $4.5 billion in five of its existing Michigan plants, and to work with the city of Detroit building a new assembly plant within city limits.

The move would increase capacity to meet demand for its Jeep and Ram brands, including production of two new Jeep branded products as well as electrified models.

The actions continue a U.S. manufacturing realignment the company began in 2016. In response to a shift in consumer demand toward SUVs and trucks, the company ended compact car production and retooled plants in Illinois, Ohio and Michigan to expand the Jeep and Ram brands.

The city of Detroit has 60 days to meet terms of a memorandum of understanding, which requires the acquisition of property for the new assembly plant. Fiat Chrysler said its additional investments are subject to the successful negotiation and final approval of development packages with the state and other local governments.

Plant investment details

Fiat Chrysler would invest $1.6 billion to convert the two plants that comprise the Mack Avenue Engine Complex into the future assembly site for the Jeep Grand Cherokee as well as a new three-row full-size Jeep SUV and plug-in hybrid (PHEV) models, adding 3,850 new jobs to support production.

The company said it intends to start construction of the new Detroit facility by the end of the second quarter with the first three-row vehicles expected to roll off the line by the end of 2020, followed by the Grand Cherokee in the first half of 2021.

The Fiat Chrysler Jefferson North Assembly Plant would receive an investment of $900 million to retool and modernize the facility to build the Dodge Durango and next-generation Jeep Grand Cherokee. The automaker expects to create 1,100 new jobs at Jefferson North.

The Mack facility would be the first new assembly plant to be built in the city of Detroit in nearly three decades. Jefferson North was the last new assembly plant built in the city in 1991. When complete, Mack would join Jefferson North as the only automotive assembly plants located completely within the Detroit city limits.

The Pentastar engines — the 3.6-, 3.2- and 3.0-liter — currently built at Mack I would be relocated to the Dundee Engine Plant as part of a $119 million investment. Pentastar production at Mack I would end by the third quarter of 2019. Mack II has been idle since it ceased production of the 3.7-liter V6 in September 2012.

Fiat Chrysler also said that its investment at Warren Truck to retool for production of the Jeep Wagoneer and Grand Wagoneer, announced in 2017, along with their electrified counterparts, would increase to $1.5 billion. Production is expected to launch in early 2021. In addition to the new Jeep models, the plant would continue to build the Ram 1500 Classic. An estimated 1,400 new jobs would be added. As a result of this investment announcement, production of the Ram Heavy Duty will continue at its current location in Saltillo, Mexico.

To support the additional production, the company’s Warren Stamping (Warren, Michigan) and Sterling Stamping (Sterling Heights, Michigan) plants would receive investments of $245 million and $160 million, respectively. Sterling Stamping is expected to add more than 80 new jobs. The investment is part of the company's capital spending plan presented in June 2018.

Over the past two years, Fiat Chrysler has realigned production at four plants in Illinois, Ohio and Michigan to increase capacity for the Jeep Cherokee, Jeep Wrangler and Ram 1500 Light Duty truck, and created additional manufacturing capacity for the Jeep Gladiator in Ohio.

The investments included:

  • $350 million in the Belvidere Assembly Plant (Illinois) to produce the Jeep Cherokee, which moved from Toledo, Ohio, in 2017. Production launched in June 2017 and added more than 300 jobs.
  • $700 million in the Toledo Assembly Complex (Ohio) to retool the North plant to produce the next-generation Jeep Wrangler. Around 700 new jobs were added to support production, which began in December 2017.
  • $1.48 billion in the Sterling Heights Assembly Plant (Michigan) to build the next-generation Ram 1500 truck, adding more than 700 new jobs. Production of the new truck began in March 2018.
  • $273 million in the south plant of the Toledo Assembly Complex to prepare the facility to produce the new Jeep Gladiator. The new truck is scheduled to launch in the first half of 2019.