Marchionne Talks Small Cars, Parts, Sourcing at Newly Expanded Stamping Plant

STERLING HEIGHTS, MI – Fiat Chrysler has a number of “viable options” when it comes to replacing its Chrysler 200/Dodge Dart small cars phasing out next year, CEO Sergio Marchionne says.

“We’ve got people flying around now looking at this situation,” he says. “So we’ll have an answer, hopefully, soon.”

Many automakers are eager to share the cost burden on small-car production, given the soft demand in that sector, Marchionne contends, suggesting FCA may have its pick of partners. “There are real viable options.”

The CEO also tells reporters “do not worry” about the future of the automaker’s Warren, MI, truck plant, which will lose its product – the Ram pickup – to the Sterling Heights assembly plant.

“When you sum up all the shifts we’ve made in product between Warren and Sterling Heights, Toledo (OH) North and South, the (future-employment) number is well in excess of current people on staff,” he says, suggesting workers from the nearby Warren plant will have jobs in Sterling Heights. “As we roll out all these products, we will employ more people than we have on staff (today).

“We’re looking at ways to utilize Warren in a significant way,” he adds. “(But) that’s a very old plant…and would need significant investment.”

Marchionne also says, contrary to reports, there are no plans to sell its Italy-based parts operation Magneti Marelli. Though he doesn’t rule out a sale long term, he suggests the components arm’s strength in electronics might present strategic value to the automaker as autonomous-vehicle technology takes hold.

“Marelli’s been the object of attention for a long time,” he says. “We’ve had unsolicited approaches from a variety of people, all of which have been turned away.”

Marchionne was on hand at the Sterling Heights Stamping Plant for the inauguration of three new press lines that will significantly expand capacity for pressed steel and aluminum parts and assemblies.

Much of that added capability is aimed at bringing back in-house stamping operations that FCA has had to outsource since the automaker closed its Twinsburg, OH, facility and reduced its capacity to just two press plants in the U.S. But some of it is tied to expected volume growth and an expanded product lineup.

The launch of the new lines represents FCA “getting its act together,” Marchionne says, announcing to employees here the investment will allow the automaker to bring previously outsourced production of Jeep Wrangler stampings back in-house.

Bright Future for Sterling Heights Stamping

In addition, Sterling Heights Stamping is expected to supply significantly more parts for the next-gen Ram pickup when production moves next door to the Sterling Heights assembly plant, where output of the 200 sedan will end in December to make room for the move.

“The amount of investment and the level of the technology have guaranteed the future of this plant going forward,” Marchionne says of Sterling Heights Stamping, which lost half its workforce during Chrysler’s 2009 bankruptcy. “As you keep (upgrading the technology), the output of this plant just explodes. So if you ask me today, in a steady-state environment over the next 10 years, this plant will increase (employment) numbers. And it will become much more powerful as a production site.”

The $166 million investment includes three state-of-the-art presses, including two extra-large High Speed Servo Tandem press lines and one large Servo Progressive press line.

FCA says the Tandem press lines installed here over the past 16 months allow a single die to be positioned in each press, so incremental changes are made to the panel as it moves through the line. Die changes can be made in just 4 minutes, compared with 20 minutes in older presses, increasing plant production flexibility.

The Tandem press lines, the first for the Sterling Heights plant, are identical to the one installed at the nearby Warren stamping plant in January.

FCA says the Servo Progressive Press allows for an unlimited number of operations with a single die, which produces parts at high speed from a single coil of steel.

The new tooling will increase capacity at the 2.74 million sq.-ft. (255,000-sq.-m) plant by nearly 75,000 stampings per day, or 20 million per year. That will raise output 30% from 62 million stampings annually to 82 million.

The 52-year-old plant supplies parts for the Chrysler Pacifica and Dodge Grand Caravan minivans; Dodge Durango, Jeep Cherokee and Jeep Grand Cherokee SUVs; Jeep Patriot and Compass CUVs; Chrysler 200 and Dodge Dart small cars; and Ram pickups at plants in Canada, Mexico, Michigan, Ohio and Illinois.

Overall, Sterling Stamping operates 19 major press lines, three blanking lines and four large progressive press lines with capacities ranging from 400 tons to 4,000 tons. The plant is equipped with 720 robots and employs 2,281 workers on three shifts, six days a week (with some Sundays). It processes nearly a half-million tons of steel and 14,000 tons of aluminum annually.

The investment is part of a more than $8.3 billion infusion in FCA manufacturing operations since the 2009 recession. That includes $3.5 billion spent on Michigan plants.

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