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FCA investing $1B in US plants; Ram heavy duty production moving from Mexico to Warren

FCA US announced a total $1 billion investment in plants in Michigan and Ohio, and the addition of 2,000 new American jobs. Consistent and combined with previously announced investments, FCA US is further demonstrating its commitment to strengthening its US manufacturing base, and aligning US capacity to extend the Jeep product lineup. In total, FCA US has committed investments of more than $9.6 billion in its US manufacturing facilities and created 25,000 new jobs to date since 2009.

The latest announcement represents the second phase of an industrialization plan announced in January 2016. The plan called for the realignment of the Company’s US manufacturing operations to fully utilize available capacity to respond to a shift in market demand for trucks and SUVs, and to further expand the Jeep and Ram brands.

With the $1 billion investment, FCA US will retool and modernize the Warren Truck Assembly Plant (Michigan) to produce the all-new Jeep Wagoneer and Grand Wagoneer, and the south plant of the Toledo Assembly Complex (Ohio) to build an all-new Jeep pickup truck. These actions are planned to be completed by 2020. More than 2,000 jobs also will be added to support production of these models. The added benefit of the investment in Warren is that it will enable the plant to produce the Ram heavy duty truck, which is currently produced in Mexico.

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 US as a global manufacturing hub for those vehicles at the heart of the SUV and truck market. These moves, which have been under discussion with Dennis Williams and the rest of the UAW leadership for some time, expand our capacity in these key segments, enabling us to meet growing demand here in the US, but more importantly to increase exports of our mid-size and larger vehicles to international markets.

—Sergio Marchionne, Chief Executive Officer of FCA N.V.


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China has a policy of >80% of the value added in a product must be made in China or the product will be slammed by a huge import tax<. I think that policy is prudent and that all large countries or free trade zones should copy it on most products and services in order to secure large local production. Smaller countries need to form free trade zones with nearby countries to stay competitive or lower the 80% requirement. It is better for the environment if the global trade of physical goods is reduced to a minimum because more is produced locally and we also create a system that is more robust to major natural disasters or war that can block international trade.

The transition to a fossil free economy also means that global trade of oil, gas and coal will disappear and that in itself will diminish international trade. We can transfer money and knowhow freely over borders but physical goods should mostly be made locally. This I believe will be the >new international trade world order< and it will be initiated by the new Trump administration. It will however take decades to be fully realized.

Tesla is showing that labor costs are no longer important for super modern physical product production as very little labor is used per USD created. For example the new Giga factory will employ 7000 people that make 10 billion USD worth’s of products per year. If they are paid 70k USD each it is still only 420 million USD per year so labor cost is not important for the total cost of the products made. So we can do this transition to local production without risking drastic cost increases in the products. However, it will take time and we need to use robots like never before.


Robots are one of the best way to reduce mass production cost. Factories with many 1000s robots do not create as many local jobs, specially when/where robots will be self-checked/adjusted and repaired by other robots.

Increased consumption may be a temporary solution to keep people working, but future longer lasting AD-EVs (requiring no drivers, less maintenance, less repairs, less insurance etc) will go the other way.

The buy American policy could be modified to match China's (and other countries) policies to use a higher percentage (80+ %) of Made in USA parts, components, materials etc? American exports could drop drastically. Doubt if Boeing, farmers and many others would like it.

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