Optimism in Auburn Hills
Much has been said about the various cutbacks at Chrysler, some seeming more intelligent than others. We’re just now seeing 1,000 workers, including numerous engineers and testers, being let go even as Chrysler has a dire need to improve existing product and develop new vehicles. Leasing has just gone out the window at Chrysler Financial. I could go on for a while, but here’s what gives me the feeling that the leaders and owners are highly optimistic for the future.
The Journey is not a barnstormer, and most PTs sold are now base models. Avenger and Sebring are slow sellers despite the move to four cylinder vehicles and smaller cars in general. Likewise, the Patriot, Compass, and Caliber all combined are not pushing the limits of the Belvidere plant by any stretch of the imagination. Someone must have suggested, at some point, either shutting down Toluca and moving the Journey to Sterling Heights, or moving the Avenger/Sebring to Belvidere, or… you get the idea. Between those three plants, one could be shut down without much disruption, if production was expected to continue at its current pace. What’s more, at current sales rates, one of the two large van plants and one of the two minivan plants could be closed without any particular impact. One does wonder whether that was the real reason for closing out the Pacifica, or whether the Pacifica was sacrificed for the Volkswagen minivan.
Newark and Conner Avenue are being closed or sold, but that doesn’t mean much. The Durango/Aspen doesn’t sell well enough for its own plant, and if it moves onto the Grand Cherokee platform, the three could all be built together on one assembly line (four if we include Commander).
However, Chrysler has not announced any further cuts, but have single-shifted or double-shifted rather than triple-shifted these plants. That indicates to me that they expect the Phoenix and automated manual transmissions, VCT Hemi, 2009 Ram, Cummins V6/V8 diesels, and other developments, coupled with the foreseen rise in demand around 2010, to make it worthwhile to keep the plants open.
