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The future of Toluca Assembly (corrected)

by David Zatz on

The fate of the Toluca, Mexico assembly plant is a quandary for Mopar observers.

Current plans appear to be for the Fiat 500 to return to European construction and for the Dodge Journey to move in with the Chrysler 200 or Jeep Cherokee when it moves to its new platform. Toluca, home of the Neon, then the PT Cruiser, then the Journey and Fiat 500, would then be empty.

mexico-chrysler

Toluca includes an assembly plant and a stamping plant, and started out in 1984 building K-cars. In 1994, the plant switched from making LeBaron, Phantom, Spirit, and Acclaim to a single focus on Neons. PT came in 2001, Journey in 2008, Fiat 500 in 2011.

While the plant’s future use is a mystery, here are what we believe to be the major options:

  1. Chrysler could shut it down entirely as unnecessary capacity far from the corporate supply lines; it is probably the easiest plant to shut down. We suspect this won’t happen; Chrysler is expanding, Toluca has traditionally had high quality, and in any case the Chrysler Success Story being written by Sergio Marchionne has no room for plant closures. 
  2. ProMaster production could be moved to Toluca, despite having just started in Saltillo, after a complete renovation. This would free up Ram Heavy Duty production in Saltillo, allow greater volumes of ProMasters to be built if the vehicle is a runaway success (as it has been in Europe), and allow exports to other markets. It would also provide a place to build the next-generation Iveco Daily, whether or not it’s sold as a Ram. One may ask why ProMasters should be built in Mexico rather than Detroit, and the answer is that Latin America has its own version of the North American Free Trade Agreement; and Mexico is in both regions. Thus, for trucks, which remain subject to an extra tax, Mexico is an ideal manufacturing point.
  3. Small and medium-sized pickups could start up there; the Dakota replacement may still be “on,” especially since Chrysler is supposed to export a European-metric-ton-capacity pickup for Fiat’s use. It would be odd if they made that truck in the US without having an American version. While the official statement is that there will not be another Dakota, that is not the same as saying there will not be another small or mid-sized pickup. The plant could also made Fiat Stradas for Latin America. This is the most likely scenario, keeping in mind that…
  4. #2 and #3 could both be true, or some other combination could be at work.

David Zatz founded Allpar in 1998 (based on a site he had begun in 1993-94), after years of writing reviews for retail trades. He has been quoted by the New York Times, the Daily Telegraph, the Detroit News, and USA Today. Before making Allpar a full-time career, he was a consultant in organizational psychology. You can reach him by using our contact form (much preferred) or by calling (313) 766-2304


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