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Published: Tuesday, 1/15/2013 - Updated: 1 year ago

Toledo to begin production of latest Jeep model in May

Marchionne: Wrangler plant expansion weighed

BY TYREL LINKHORN
BLADE BUSINESS WRITER
Chrysler Group CEO Sergio Marchionne speaks to the press at the North American International Auto Show in Detroit. Chrysler Group CEO Sergio Marchionne speaks to the press at the North American International Auto Show in Detroit.
THE BLADE/ANDY MORRISON Enlarge | Buy This Photo

DETROIT — Production of the Jeep Liberty successor will begin in Toledo on May 23, Chrysler Group chief executive Sergio Marchionne told reporters on Monday at the North American International Auto Show.

In an earlier meeting with reporters, Mr. Marchionne said the vehicle — whose name is still a closely guarded secret — will debut in late March at the New York International Auto Show. It should go on sale by July, he said.

The segment in which the new vehicle will compete is the largest SUV segment in the United States.

Liberty production ended in August, leaving Jeep high and dry in that segment for now.

“I need the car,” Mr. Marchionne said.

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RELATED: Diesel option to power Jeep Grand Cherokee

He also talked about the Toledo-built Wrangler, which set an all-time sales record last year and was Chrysler Group’s third-best-selling vehicle.

Though expansion on the Wrangler side of the Toledo plant is far away, it’s something Chrysler is looking at, Mr. Marchionne said.

“We’ve asked the people of Toledo to work through summer shutdowns [and] Christmas shutdowns to try to deal with demand. I can’t ask for more,” he said.

Wrangler production was up nearly 20 percent last year, and Mr. Marchionne said the plant is producing more Wranglers than it was designed to build.

Jeep President and CEO Mike Manley speaks about the 2014 diesel Jeep Grand Cherokee at the North American International Auto Show in Detroit. Jeep President and CEO Mike Manley speaks about the 2014 diesel Jeep Grand Cherokee at the North American International Auto Show in Detroit.
THE BLADE/ANDY MORRISON Enlarge | Buy This Photo

He said the company is examining ways to physically expand in Toledo.

“All of this is being done with a very clear expectation at some point in time we need to invest in Toledo to rejuvenate the [plant’s] architecture without losing any of the capabilities of the current Wrangler,” he said, though he added it won’t happen until at least 2015.

At an earlier session with reporters, Mr. Marchionne said the Wrangler, along with the Detroit-built Grand Cherokee, were “pillar points” of the brand that can “never ever be moved out” of the United States.

“Those things will continue to be as American as apple pie, forever,” he said.

However, a deal to build some Jeeps in China for the Chinese market is being finalized.

“These are Jeeps that are designed to deal with the Chinese market. I can’t build them here because I can’t make it work economically,” he said.

Mr. Marchionne said the Liberty successor will also be the first vehicle to get Chrysler’s all-new, nine-speed automatic transmission.

The vehicle is of crucial importance to Toledo, where it will create 1,100 new jobs this year. Chrysler also has a lot riding on the vehicle.

“It’s of absolutely tremendous importance,” said Ed Kim, vice president of industry analysis for Auto Pacific. “It’s strategically going to be one of the most important vehicles in Chrysler’s portfolio. It’s going to be a test of just how well this Chrysler-Fiat marriage is coming along.”

Mr. Marchionne is also CEO of Italy’s Fiat SpA, the Italian automaker that controls Chrysler.

As is his style, Mr. Marchionne was open and blunt during the hour-long session.

Chrysler’s biggest challenge?

“The threat of complacency,” he said.

Could he elaborate?

“Too many smiling faces on the stand this morning when we were launching the Grand Cherokee.”

Some of that was said in jest, but perhaps not much. Mr. Marchionne said the accolades and awards of 2012 should rightly be celebrated, but the industry faces stiff competition in the United States and significant trouble in Europe.

He said he believes automakers racked up total operating losses in Europe of $5.3 billion to $6.7 billion last year.

With losses like that, “you have now just laced the cloud structure with a potential storm the size of a tornado,” he said.

“This just cannot go on forever,” he said.

Still, looking at Chrysler, Mr. Marchionne was positive. He said Chrysler has the manufacturing capacity in place if U.S. auto sales reach the 15 million mark that most analysts are expecting for 2013, and to meet Chrysler’s goal of selling 2.8 million cars worldwide in 2014.

Mr. Marchionne also discussed an Italian-built Jeep that is coming to America.

Mr. Marchionne said the vehicle, which is smaller than anything in Jeep’s current lineup, will be sold here, but the United States won’t be its primary market. The vehicle, he said, will help get younger people into the Jeep brand at a lower price.

Contact Tyrel Linkhorn at: tlinkhorn@theblade.com or 419-724-6134.



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