Overcapacity an issue, but Chrysler plants will open in weeks: Fiat
By The Canadian Press | June 18, 2009
ROME: Fiat, which has recently taken a controlling stake in Chrysler, called Thursday for a "serious restructuring" of the auto industry, saying the global crisis has worsened the problem of production overcapacity as it announced plans to resume production at its Brampton and Windsor plants and five other North American factories at the end of June.
In addition, parts stamping, engine and transmission factories that feed those plants also will restart June 29, Chrysler said in a statement.
"The global crisis has further aggravated the problem of production overcapacity that has been plaguing the automotive industry for years," said a statement released by Fiat.
The statement followed a meeting between Fiat chief executive Sergio Marchionne with the Italian government and unions at Premier's Silvio Berlusconi's office in Rome to illustrate the group's mid-term program.
Fiat also said "far-reaching strategic measures are necessary to achieve an adequate level of critical mass, increase volumes produced for each platform and expand geographic presence."
It said the deal with Chrysler was part of that strategic approach.
During the talks, Fiat outlined its production plans in Italian plants. Marchionne called for a concerted effort, saying that "maintaining equilibrium in employment levels in the face of these extremely difficult market conditions is no easy task."
Earlier in June Fiat took on most of Chrysler's assets in exchange for technology and management know-how. The alliance created the 6th largest automaker worldwide, according to Fiat.
The company confirmed that besides its Canadian plants, factories in Sterling Heights and Warren, Mich.; St. Louis, Mo.; Toledo, Ohio and Toluca, Mexico, would restart operations. A plant in Detroit that makes the Dodge Viper sports car restarted Monday.
When the factories come back on line, their work will be done under a different manufacturing system, one used in Europe by Fiat Group SpA called ``World Class Manufacturing.''
The eight assembly plants that are restarting employ about 15,000 workers, according to Chrysler's Web site.
Five Chrysler assembly plants will stay dark, including the Jefferson North plant in Detroit that makes the Jeep Grand Cherokee and Commander sport utility vehicles, and the Belvidere, Ill., factory that makes Chrysler's smallest offerings, the Dodge Calibre and Jeep Compass and Patriot.
