Windsor Auto Suppliers Poised to Benefit From FCA Jeep Plant
Auto suppliers in the Windsor area are expected to get a big chunk of the multi-billion dollar investment by Fiat Chrysler in Detroit.
The company has announced a total investment of $4.5-billion to boost production at five existing plants as well as building a new Jeep plant. The new plant comes with a price tag of $1.6-billion and construction should begin later in 2019.
The automaker will also convert the two plants at the Mack Avenue Engine Complex into a future assembly site for the three-row, next generation Jeep Grand Cherokee.
The investment will create more than 6,500 jobs.
Canadian Auto Parts Manufacturing Association President Flavio Volpe sees the Windsor area prospering from the investment. He says the production will require about $10-billion a year in supplies to make the vehicles.
"A plant in Michigan probably means $2-to-$3-billion worth of potential purchases from Ontario. And the closer you are to Michigan, the closer you are to $2-or$3-billion. I think this is a great boon for Windsor especially," says Volpe.
FCA Canada Corporate Headquarters (photo by AM800's Peter Langille)
He also points out that the FCA Canada headquarters is in Windsor.
"Hundred year relationships with the company in Windsor, very strong relationship with some of the best suppliers in the area," says Volpe. "It's going to be a function of a two-way discussion. It isn't just suppliers having to pitch FCA, FCA's going to be turning to suppliers in the area that they've done business with over generations and say 'this is what we're planning on, this is what we invite you to bid on.'"
He says many supplier plants are already running near capacity and he expects significant growth.
"They're going to have to expand physically and their workforce to accommodate the business," says Volpe. "This is the best type of news for any supplier cluster like Windsor itself. Incremental volumes in an area."
Volpe adds the importance of the Gordie Howe International Bridge can't be discounted. He says for an investment of the scale FCA is making, they needed to be sure the "just in time" delivery system had redundancy.