Jeep globalization grows; Wrangler future in Toledo still unclearWritten by Tom Konecny | | email@example.com
Whether the Jeep Wrangler remains in Toledo remains to be seen, but one thing is clear: the brand is selling well everywhere, and Fiat Chrysler Automobiles (FCA) plans to take Jeep global like never before.
But what might that mean for Toledo?
“The Toledo plant has all the demand it can handle,” said FCA spokeswoman Jodi Tinson.
Last year, the Toledo Assembly Complex produced 511,466 vehicles, the most ever, and FCA has been exporting Jeeps to more than 100 markets outside North America for years. In fact, Jeep global vehicles sales increased 39 percent in 2014 to a record of 1,017,019 units.
“The Jeep brand has been sold internationally for years, but some markets, like China, require local production,” Tinson said. “Also, local production helps avoid exceptionally high tariffs that drive up the price of a vehicle.”
FCA is looking to open Jeep plants in Brazil and China. All told, it will increase production capacity by 590,000 units in 18 months, a goal that appears unprecedented, Tinson said.
“I don’t know that FCA, or Chrysler, has ever done that, but that additional capacity is primarily coming through localized production,” Tinson said, indicating that its U.S. plants are already at or near full capacity.
To have that many more Jeeps made in Toledo is impossible.
“Producing over 500,000 vehicles there last year was an exceptional accomplishment,” Tinson said. “The plant is already running 20 hours a day, seven days a week.”
Tinson did offer that the knowledge gained and lessons learned from the Toledo Assembly Complex would certainly be shared around the world.
UAW Local 12 President Bruce Baumhower said Toledo had many employees involved when Jeep expanded to Beijing in the 1980s.
“We had a lot of people that worked in China for six months,” Baumhower said. “I have some management friends that went there for two to three years, but I don’t anticipate that [happening] now.”
Matt Sapara, the city’s director of economic and business development, believes Jeep’s increased global presence is positive news.
“[The reason FCA is] going global is that the Wrangler is still being built here. The Wrangler is a huge selling product, so that’s why they want to increase capacity. If we can increase the efficiency and capacity at this site, that really helps our community.”
The city submitted its incentive package to FCA on March 13, and Sapara said leaders are “guardedly optimistic” about what the future holds for Jeep production in Toledo.
The Jeep Renegade will be produced at a new state-of-the art plant in Pernambuco, Brazil, with sales starting during the second quarter of 2015.
“One of the biggest opportunities for the future growth of Jeep is in Brazil,” said Mike Manley, President and CEO of the Jeep brand with FCA. “We now have a locally built vehicle that perfectly fits Latin American roads, with the capability and technology features that are unique in this segment.”
Jeep will also return to China this year for the first time in almost a decade.
“While achieving 1 million vehicle sales in 2014 was certainly a milestone, 2015 will be a transformational year in the globalization of the brand, as we begin local manufacturing in Brazil and return to local manufacturing in China after an absence of nearly a decade,” Manley said.
In addition to its 39 percent global increase, Jeep sales rose 41 percent in the U.S. in 2014, with a record 692,348 total sales.
Jeep sales rose 40 percent in the Europe, Middle East and Africa regions and 42 percent in the Asia-Pacific region in 2014. In China — the world’s largest automobile market — sales rose 49 percent.
Jeep sales were led globally and in the U.S. by Grand Cherokee (279,567 global; 183,786 U.S.), Cherokee (236,289 global; 178,508 U.S.), Wrangler (234,579 global; 175,328 U.S.), Compass (134,629 global; 61,264 U.S.) and Patriot (122,387 global; 93,462 U.S.). Wrangler and Cherokee are built in Toledo.
Additionally, 2014 marked the fifth consecutive year of increased Jeep sales, both globally and in the U.S. In 2013, the brand recorded increases of 4 percent globally and 3 percent in the U.S.