Article published on 26 February 2019 12: 08 by CRAINS DETROIT, read the original article HERE

4,5 billion USD of Fiat Chrysler plan to create 6 500 Jobs in Detroit area

Fiat Chrysler Automobiles announced Tuesday a plan to create about 6 500 additional jobs in southeast Michigan and to open the first new auto assembly plant in Detroit in a generation.

The automaker is considering converting its Mack Avenue engine plants on the east side of Detroit into a new assembly plant, retooling the Jefferson North Assembly plant, and making new investments in three other plants at Warren and Sterling Heights.

FCA plans to spend 1,6 $ 1 billion on the construction of a new-generation Jeep Grand Cherokee, a new three-row Jeep SUV and a plug-in Hybrid in the Mack Engine complex, half of which has been unused since 2012.

For the city of Detroit alone, the Auburn Hills-based automaker will create nearly 5 jobs between factories on Mack Avenue and Jefferson North. The FCA plans to invest $ 000 million in retooling and modernizing Jefferson North, where workers assemble the Dodge Durango and Jeep Grand Cherokee.

Mayor Mike Duggan warned the deal was not done. The city of Detroit has pledged to reunite 200 acres of land over the next 60 days adjacent to the Mack Avenue complex in order to provide the FCA with more space for parking, new vehicle storage and parts delivery.

"I think most people realize that this is a generation's chance to change the economic lot of thousands of Detroiters, ”Duggan said at a press conference at the Coleman A. Young Civic Center.

Duggan said landowners would be offered voluntary buyouts. The city of Detroit does not have the power to seize private property for its private development through a prominent estate.

The 200-acre footprint - bounded by Saint-Jean Street, Mack Avenue, Connor Street and Jefferson Avenue - does not include any residences, Duggan said.

“We're going to do this without taking anyone out of their homes,” the mayor said, referring to the young government's controversial condemnation of the forced conviction of the Poletown neighborhood in the early 1980s in order to help General Motors build the Detroit-Hamtramck assembly plant. .

Detroit will collect and buy the land on behalf of the FCA using tax dollars and cut taxes by $ 12 million, "which in a $ 2,5 billion deal is pretty modest," Duggan said. .

"The state pays a larger contribution on the side of tax relief", added the mayor.

Michigan Economic Development Corp. chief executive Jeff Mason declined to disclose details of state tax incentives. The FCA will be offered through the Michigan Strategic Fund.

“We will already be using the tools available in our toolkit to carry out this project at home,” Mason said.

Crain's Detroit Business / Chad Livengood
Detroit Mayor Mike Duggan speaks. Gov. Gretchen Whitmer and Wayne County Executive Warren Evans are among the guest speakers when the city announces a $ 4,5 billion investment in the Detroit subway by Fiat Chrysler.

About 170's 200 acres are under the control of the City of Detroit, DTE Energy, the Great Lakes Water Authority and the Moroun family, said Duggan.

Detroit will cede 40 acres of city-owned land, including a section of St. John Street and its sand wall adjacent to a neighborhood between Mack Avenue and East Warren Avenue, said Tom Lewand Sr. , leader of the Job Creation and Economic Growth group from the Duggan office. .

The Moroun family owns 80 acres of the desired land that is part of a vehicle transportation logistics center that the Crowne Enterprises family built in 2017 after the destruction of the old Budd Wheel factory.

Duggan said he hoped businessman Matthew Moroun would sell the city the land his company had just redeveloped.

“These are businessmen with a lot of ground and it will be a tough conversation,” said Duggan, who then added, “I expect a deal.”

 

The FCA's desired footprint also includes 11 acres owned by the Great Lakes Water Authority, Lewand said. There is a need for 40-50 acres of land at DTE Energy's old facility at Conner Creek, including land with the old coal-fired power plant which is slated to be demolished later this year, he said. .

Mr Duggan and administration officials have had preliminary discussions with all of the owners about the sale, but no transactions have taken place, Mr Lewand said.

“We couldn't get any deals until we signed the (memorandum of understanding) with the company,” Lewand told Crain's.

In addition to reducing 12's $ million property tax, the value of the land is prompting Detroit taxpayers to induce the FCA to build the Detroit plant.

“The land is our contribution - as was the case in the Chrysler Jefferson North deal in 1991,” said Duggan, who was Wayne County's deputy manager at the time.

“We are negotiating - as best I can - land swaps in order to reduce the amount of personal expenses,” said the mayor.

Duggan declined to reveal how much money he budgeted to spend taxpayer dollars on acquiring land to be donated to the global automaker.

“We won't be talking about the budget until the day it's over,” Duggan told Crain.

The FCA has announced that it will spend $ 4,5 billion on the Mack plant and five other production facilities in Michigan.

“It has been a long time since we have seen such significant and transformative investments,” Governor Gretchen Whitmer said. “This is a generational investment in the state of Michigan.”

FCA officials announced the new investments at a noon press conference at Coleman A. Young Civic Center, along with Whitmer, Duggan, Evans, Brenda Jones City Council Chair and members of the Town Hall. United Auto Workers.

Mark Stewart, chief operating officer of FCA North America, said the automaker wants to begin construction in the second quarter of this year, with a goal of building new three-row Jeep Grand Cherokees at the plant. of Mack Avenue by the end of 2020.

“We need everyone's support to be able to meet this tight schedule,” said Stewart. “… And it's going to take a community.”

Wayne County Executive Warren Evans said the FCA could have built the new Jeep plant “on the ground,” as has been the trend in the auto industry for decades.

“It would have been so much easier than negotiating this,” Evans said. “But that wouldn't be so viable.”

At FCA's truck plant in Warren, the automaker plans to create 1 additional jobs and invest more in the assembly of the all-new Jeep Wagoneer and Grand Wagoneer. FCA also assembles its Ram 400 trucks at the Warren plant.

Jennifer Vuong / Automotive News
FCA slowed the Mack II engine plant to 2012.

“FCA's announcement of a $ 1,9 billion investment and the creation of nearly 1 new jobs at Warren Truck, Warren Stamping and Sterling Stamping, illustrates the company's forward-looking strategy Macomb County leader Mark Hackel said in a statement. “It is also a testament to the capabilities of our talented workforce, who will now be responsible for designing exciting new products and advancing automotive technology and capabilities.”

The automaker has announced that it will transfer production of its Pentastar engine from the Mack I engine plant in Detroit to that in Dundee by the end of the third quarter of this year. This retooling will require an additional investment of $ 119 million in the Dundee plant, FCA said.

UAW Vice President Cindy Estrada said FCA's expansion in Detroit would create more union jobs and reverse the fate of Chrylser's bankruptcy and federal bailout ten years ago. years.

“Ten or fifteen years ago that was not Chrysler's story,” Estrada said. “… This is such an opportunity for Detroit in the same way that FCA and the UAW workers came together to reinvent their business.”

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