Fiat Chrysler Automobiles (FCA) will reopen an idled Detroit engine plant, invest billions into five existing Michigan plants, and create about 6,500 U.S. auto jobs in a move reflecting President Trump’s economic nationalist agenda.
The Plans for Michigan
In an announcement Tuesday, Fiat Chrysler executives revealed their plans to reopen the Mack Avenue II engine plant in Detroit by investing $1.6 billion into the site to convert it into a manufacturing plant for the company’s Jeep Grand Cherokee and a new three-row full size Jeep SUV. The investment to reopen the plant — which was shuttered nearly seven years ago leaving hundreds of American workers laid off — will create 3,850 U.S. jobs.
The total $4.5 billion investment by Fiat Chrysler will mean a total of about 6,500 new U.S. jobs at its give existing Michigan plants with plans to build a new assembly plant in the city limits of Detroit, marking the first time a new plant will be built in the city in almost three decades.
“The reborn Mack facility would be the first new assembly plant to be built in the city of Detroit in nearly three decades,” Fiat Chrysler executives said in a statement. “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 to be located completely within the city limits of Detroit.”
The investment includes a $900 million investment to modernize the Jefferson North assembly plant. The investment will mean 1,100 new U.S. jobs at the plant to continue production of the Dodge Durango and the next generation Jeep Grand Cherokee.
Additionally, Fiat Chrysler will invest $1.5 billion into its Warren, Michigan, truck assembly plant for production of the new Jeep Wagoneer and Grand Wagoneer, along with continued production of the Ram 1500 Classic. This investment amounts to 1,400 new jobs at the Warren plant.
All three plants, the Mack Avenue Engine Complex, Jefferson North, and the Warren plant will be equipped to produce plug-in hybrid versions of the Jeep models made at each facility and are expected to have the capacity to produce fully battery electric cars in the future, executives said.
Both the Sterling Stamping plant in Sterling Heights, Michigan, and Warren Stamping plant in Warren, Michigan, will get a $400 million total investment to support additional production, creating roughly 80 new U.S. jobs at the Sterling plant.
Another $119 million will be invested to relocate the Pentastar engine production currently at the Mack I Engine plant to the Dundee Engine plant in Dundee, Michigan.
Result of Trump’s Economic Nationalism
Fiat Chrysler’s decision to expand U.S. production came in response to Trump’s use of tariffs to bring manufacturing jobs back to the United States after years of working and middle class job outsourcing by multinational corporations through multilateral free trade deals.
When Trump threatened last year to impose a 25 percent tariff on pickup trucks made in Mexico, Fiat Chrysler executives considered moving all Ram truck production out of Mexico.
Fiat Chrysler CEO Mike Manley told Reuters last October that in light of Trump’s tentative USMCA trade agreement, the company decided to keep its heavy-duty truck production plant in Saltillo, Mexico, while also expanding production and jobs in the U.S.
“This massive FCA investment in Detroit shows that the president’s aggressive trade strategy is working to rebuild manufacturing and to make the United States the premier place to manufacture automobiles,” Coalition for a Prosperous America CEO Michael Stumo told Breitbart News. “The fact that they are expanding the manufacture of engines and complete vehicles in Michigan shows that the steel tariffs were not an impediment to growth. Thousands more jobs will be created to supply these new plants.”
“President Trump’s threat of auto tariffs likely supported this major investment decision,” Stumo continued. “If the tariffs on imported autos are imposed, it will help FCA’s Jeep and Ram further increase sales and market share, benefitting the Michigan economy and creating even more good paying jobs.”
The United Auto Workers (UAW) union has, likewise, welcomed the news of new investments and jobs in American auto manufacturing by Fiat Chrysler, just as Ford and General Motors (GM) continue outsourcing their U.S. manufacturing to China and Mexico.
“At a time when the Detroit area and other communities are seeing auto plants without work and in jeopardy of closing while companies continue to ship vehicles into the US from Mexico, China, Korea, and other countries it is exciting to see that we can work with FCA and secure good union jobs here in Michigan,” UAW Vice President Cindy Estrada said in a statement.
Fiat Chrysler’s commitment to manufacturing electric cars in the U.S., rather than offshoring production to low-wage foreign countries is in stark contrast to the plans of Ford and GM.
Ford, for example, in 2017 announced it would produce electric vehicles in Mexico, reversing its promise to manufacture in Flat Rock, Michigan. Similarly, GM is laying off thousands of American workers while the corporation expands electric car production in China.
American manufacturing is vital to the U.S. economy, as every one manufacturing job supports an additional 7.4 American jobs in other industries. Decades of free trade, with deals like the North American Free Trade Agreement (NAFTA), have devastated American manufacturing and U.S. workers’ job prospects, as well as suppressed their wages.
John Binder is a reporter for Breitbart News. Follow him on Twitter at @JxhnBinder.
Author: John Binder