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Warren vs Saltillo: the truck game

by David Zatz on

In around two years, Warren Truck will be ready to make Ram pickups as well as Jeep Wagoneers. What’s the real game plan?

Warren

Sergio Marchionne talked about the boon of “additional capacity in the event that we have to move the heavy-duty truck out of Mexico into the US,” echoing the idea that Donald Trump may increase import taxes on Mexican goods — which includes Hemi engines, many Ram pickups, ProMaster vans, and the next Jeep Compass.

The plan, though, was created well over a year ago, as Marchionne himself said — “I know you’re going to hate when I say this, but the decision has been in the works for a long period of time. It was part of the discussions that we’ve had going back to 2015 with Dennis, when he was in the UAW. … There’s nothing unusual about this step; it’s just a continuation of the retooling of the US manufacturing base…”

So why would Marchionne be talking about moving the Ram Heavy Duty? It’s possible he wants to consolidate manufacturing in a smaller area, to avoid shipping parts across the country, but that would mean leaving the Texas area. Could he be thinking about renovating Saltillo to make unibody cars or crossovers? Or, perhaps, dedicating it to larger-than-class-5 trucks? The company still has personal, if not business, relationships with heavy truck maker CNH.  A jointly developed Ram-branded class 6-8 series is not unthinkable, with a few years’ lead time.

There’s yet another possibility — continuing the expansion of Ram International by making a midsize pickup, sized for global sale, in Saltillo, following a renovation. The plant could presumably handle big-Ram overflow and the midsize at once. This would be five years or so down the road, when the balance sheet is ready for more big investments.

One thing seems clear: though Sergio Marchionne keeps talking about FCA merging, the path it’s taking will gear it up to be a more global and independent automaker.


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