Italian-American Automobile Manufacturer FCA to Move Ram Production to Michigan from Mexico, Add 2500 Jobs

Fiat Chrysler Automobiles will invest more than $1 billion to modernize the company’s Warren Truck Plant in metro Detroit, adding 2,500 jobs and moving production of its Ram Heavy Duty trucks from Mexico.

“These announcements reflect our ongoing commitment to our U.S. manufacturing footprint and the dedicated employees who have contributed to FCA’s success,” Fiat Chrysler CEO Sergio Marchionne said in a news release. Mr. Marchionne was quoted on Detroit Free Press.

The CEO a year ago raised the possibility that the automaker would move production of its heavy-duty pickups to the United States, saying U.S. tax and trade policy would influence the decision, Reuters reported.

The company said Thursday evening that the new federal tax law made the shift possible. That legislation, signed into law in December, cut the corporate tax rate from 35 to 21 percent, Detroit Free Press reported.

“It is only proper that our employees share in the savings generated by tax reform and that we openly acknowledge the resulting improvement in the U.S. business environment by investing in our industrial footprint accordingly,” Marchionne added.

FCA also announced $2,000 bonuses that will be paid in the second quarter of this year to 60,000 hourly and salaried employees in the U.S., excluding senior leadership. Those bonuses are to be in addition to any profit-sharing or performance bonuses the employees would receive this year, Reuters reported.

The moves may prove useful to Fiat Chrysler’s cause. Threats by Donald Trump to withdraw the U.S. from the North American Free Trade Agreement or dramatically rework the deal have spurred warnings from the auto industry of major harm. The president also has said he will cut carmakers a break on fuel economy standards his administration is reviewing and explicitly asked them to return the favor by hiring more workers, Bloomberg reported.

“At least making Trump’s tax plan looks like it’s rewarding workers very quickly should bode well for the administration,” Dave Sullivan, an analyst at AutoPacific Inc., said by phone. “Part of it also is showing the administration how many workers they have here in the U.S.” and signaling the company will “pump that money right into the economy.” Mr. Sullivan was quoted on Bloomberg.