Chrysler to Shift Production of 300 Sedan to Canada (Update3)

By Jeff Bennett

July 19 (Bloomberg) -- Chrysler will spend as much as $1.2 billion to move assembly of a version of its 300 sedan to Ontario from Austria as the automaker works to return to profit.

About $500 million will go to Chrysler's Brampton plant to build the 300 LX model, while other money will be spent on the car's design, engineering and supplier development, spokesman Ed Saenz said today. Magna International Inc. now makes the 300 in Graz, Austria.

The shift to Brampton is part of Chrysler's Feb. 14 plan to cut manufacturing and other costs after a $680 million 2006 loss. DaimlerChrysler AG is selling an 80.1 percent stake in the Auburn Hills, Michigan-based company to Cerberus Capital Management LP.

``With all of models going through the plant we can now add in different versions of vehicles,' Saenz said. ``The move will also help us save money by not having to retool Magna's Graz facility. Manufacturing flexibility is critical.'

Production of the LX model of the 300 is scheduled to begin in 2010 at Brampton, where about 4,000 workers on three shifts now make the 300, Dodge Magnum and Dodge Charger. The Charger and 300 were Chrysler's top-selling cars in the U.S. in the first half. The Brampton factory is scheduled to add the two- door Dodge Challenger coupe next year.

Today's announcement has no impact on Chrysler's 300C production at DaimlerChrysler's plant in Beijing, Saenz said.

Magna's Challenge

Magna Chief Financial Officer Vince Galifi said the Aurora, Ontario-based company had been producing the 300 in Austria since 2005. ``We continue to have discussions with automakers about other potential vehicle assembly contracts,' he said.

Magna made an undisclosed bid for Chrysler earlier in the year. The automaker's sale to Cerberus is scheduled to close this quarter.

Saenz said the investment was announced to workers today in Brampton. The news comes two days after Chrysler said it was scrapping its plans to build a new luxury sedan known as the Imperial because of rising gasoline prices and changing mileage standards. That model was to be built in Brampton.

DaimlerChrysler's U.S. shares rose 13 cents to $92.09 at 4:01 p.m. in New York Stock Exchange composite trading. Magna's U.S. shares gained 1 cent to $95.20.

 

Chrysler 300 Changes Plants - Car News

Magna’s Austrian plant sees products moving back to manufacturers’ U.S. factories, but there are new product prospects
BY ALISA PRIDDLE, July 2007


Magna is undergoing quite the turnover of product, mostly at the hands of Chrysler and BMW.

Chrysler has announced it is consolidating production of the Chrysler 300 at its Brampton, Ontario, Canada, plant, including roughly 27,000 right-hand-drive and diesel versions annually for international markets that currently are built, under contract, by Magna Steyr at its plant in Graz, Austria.

Chrysler is investing $500 million in Brampton to tool up to build European-market 300s in Canada starting in 2010.

The automaker is investing another $1.2 billion in Brampton in preparation for LY, which is the next-generation of the LX family of rear-drive cars: the 300, Dodge Magnum and Charger, and the Dodge Challenger (LC) that is coming in 2008.

Dropped from the lineup is the Chrysler Imperial luxury sedan that was to slot in at the top of the lineup, but the program has been cancelled because of concerns about fuel economy. Members of the Canadian Auto Workers union had voted to accept concessions to get the Imperial work in Brampton, but suspicions were raised when confirmation of the sedan kept being delayed.

Magna also is losing production of the 2008 Chrysler and Dodge minivans, as their assembly is being moved to the St. Louis, Missouri, minivan plant. The fifth-generation minivans launch in St. Louis in October.

And BMW also is pulling product from the Magna plant with plans to bring assembly of the 2010 X3 SUV in-house, to its plant in Spartanburg, South Carolina. Magna was building about 115,000 units annually of the X3, which represented about 45% of the total production in Graz.

The expectation has been that BMW would use Magna to build another new vehicle and reports out of Europe suggest it will be a Mini-based SUV to be called the Mini Colorado, with volumes in the 65,000 range.

Magna also is bidding to build a VW roadster, said to be worth about 20,000 units of production annually.

 

Look the last sentence about the Phoenix V-6 engine. Could the Challenger eventually have this engine?

Magna in talks to build a much bigger Mini
GREG KEENAN

AUTO INDUSTRY REPORTER

July 19, 2007

Magna International Inc. is negotiating with BMW AG to build a sport-utility-vehicle version of the auto maker's popular Mini cars, industry sources in Europe said yesterday.

The vehicle would be called the Mini Colorado, a source in Detroit said, and Magna's Steyr plant in Graz, Austria, would assemble about 65,000 of the vehicles annually.

In addition, Magna Steyr is in the running to assemble a roadster for Volkswagen AG, which would add another 20,000 vehicles to production at Graz, the Detroit source said.

The Mini has been a smash success for BMW, and the plant in Oxford, England, where it is manufactured is running flat out.


The new business would help offset the loss of the Chrysler 300 at Magna Steyr, which produced 26,400 copies of the 300 last year or about 10 per cent of the 248,000 vehicles that came out of Graz.

Chrysler will announce today that it is shifting production of the 300 to its own assembly plant in Brampton, Ont., where it will spend more than $1-billion to upgrade the plant for the next generation of the Brampton vehicles, which will include right-hand-drive and diesel-powered versions of the 300, sources said.

Magna is negotiating with several auto makers, a high-ranking European industry source said. Senior executives are confident the Canadian auto parts giant will win new assembly business to replace both the Chrysler 300 and, more important, the BMW X3 SUV, which BMW will begin manufacturing in South Carolina for the 2010 model year.

BMW sold 113,000 X3 models last year, which represented about 45 per cent of the production at Graz.

Production of the Mercedes-Benz E-class is being brought in-house by DaimlerChrysler AG. Chrysler Group is also moving European minivan production out of Graz and shifting it to plants in Windsor, Ont., and St. Louis, ahead of its impending divorce from parent Daimler.

"Chrysler obviously needs to fill its own facilities and this is a quick way of doing that," one industry analyst said.

Neither Magna nor Chrysler officials would comment.

The Brampton plant has been scheduled all along to begin building the new versions of the vehicles in 2010. In addition to the 300, the Dodge Charger and Magnum cars are built in Brampton and it's scheduled to add the Dodge Challenger in 2008.

Shifting assembly of the right-hand-drive and diesel version of the cars will help compensate for the company scrapping a $700-million plan to use Brampton as the site for a new flagship car called the Chrysler Imperial.

The Imperial appears to be a victim of high gasoline prices and a move in Washington to dramatically tighten fuel economy regulations so that an auto maker's entire fleet will average 35 miles a gallon. At the moment, there are separate standards for cars and trucks. The Detroit auto makers have argued that a single standard will hurt them the most because their sales are heavily skewed to full-sized pickup trucks and sport utility vehicles.

The new versions of the cars coming out of Brampton will likely have Chrysler's new Phoenix V-6 engine. Fuel economy in that engine will be 6 to 8 per cent better than it is in the current six-cylinder Brampton-made cars.

 

Wow, we made Challengers last year.

Chrysler will ramp up 300 in Brampton

TheStar.com - Auto - Chrysler will ramp up 300 in Brampton

Automaker moving European production of sedan from Magna-owned Austrian plant to Ontario site

July 18, 2007
Tony Van Alphen
Business Reporter

Chrysler will invest about $1.2 billion in its Brampton assembly complex and shift European production of the popular 300 sedan to the plant during the next few years.

The auto giant was to tell employees tomorrow that it plans to end production of the Chrysler 300 at the Magna Steyr operation in Graz, Austria, when an existing contract expires in 2010 and transfer production here, sources confirmed yesterday.

The company, which already builds the 300 model and three other vehicles in Brampton, had planned to invest about $700 million for another car there but will instead boost spending to $1.2 billion to accommodate changes at the plant, according to sources familiar with the company's plants.

Retooling and other alterations will allow the plant to build Chrysler 300 models with right- and left-side steering plus a diesel version for export to the European market, the sources said.

Chrysler will also move up introduction of a new-generation 300 model by a year, from 2011 to the summer of 2010.

The investment and shift in production will help maintain output and employment levels at the plant.

Last year, production of the Chrysler 300 sedan, Dodge Magnum wagon, Charger and Challenger sports cars increased slightly to almost 315,000 vehicles. The plant employs more than 4,000 administrative and production workers.

"This will make Brampton the company's worldwide lead plant for the 300 model for a long time," said one source.

Sources said Frank Ewasyshyn, executive vice-president of manufacturing for the Chrysler Group, is scheduled to meet with workers tomorrow for a "town hall" meeting on the shop floor to discuss the Brampton plant's progress and reveal the company's intentions.

A company spokesperson would not comment on the plant's event.

Vince Bailey, president of Canadian Auto Workers Local 1285, is on vacation and other union leaders could not be reached for comment.

The company had considered assembling a fifth vehicle, the Imperial luxury sedan, at the plant by 2009 but said yesterday it had cancelled that project a few weeks ago.

The loss of production of the Chrysler 300 is another blow to the plant in Austria, which is a division of Aurora-based auto-parts powerhouse Magna International Inc.

BMW informed Magna in May that it would transfer output of the next generation X3 sport-utility vehicle from the Graz operation to its plant in Spartanburg, S.C., in 2010. Magna is talking with other automakers to fill the void in Graz.

A Magna spokesperson would not comment on Chrysler's decision.

The Austrian plant produces about 30,000 Chrysler 300 vehicles annually in addition to several models for other automakers.

The major investment in Brampton follows a decision by workers earlier this year to accept a significant concession in their contract that would reduce operating costs if the company made an investment.

After initially rejecting changes that included elimination of premium pay of about $5,000 annually, the workers accepted the same concession a few weeks later in a so-called "shelf agreement."

The changes would take effect 30 days after the company announced a major investment at the plant. Output of the four vehicles at the plant has slipped from 177,422 in the first half of 2006 to 140,442 in the same period this year.

Production of the Chrysler 300, which was a big hit when it originally appeared in showrooms in 2004, has dropped from 89,148 in the first six months of 2006 to 65,220 in the same period this year.

There is also some speculation that Chrysler

 

Chrysler confirms plan to make 300s in Brampton
July 19, 2007

BY TIM HIGGINS

FREE PRESS BUSINESS WRITER

BRAMPTON, CANADA — The Chrysler Group confirmed this morning plans to spend as much as $1.4 billion to upgrade the Chrysler 300 and Dodge Charger with much of that money pouring into update the assembly plant here.

Chrysler Executive Vice President Frank Ewasyshyn announced the decision in front of hourly workers at the Brampton assembly plant.

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A major part of the plan is to have the plant begin making versions of the 300, which are made in Austria, for the European marketplace.

Brampton, which has about 4,000 employees, already makes the 300 for the North America and the Dodge Magnum and Dodge Charger.

The Brampton plant will see between $400 million and $500 million in investment, Ewasyshyn said.

He added that the new Dodge Challenger will also be made at the plant.

Chrysler had planned to build a new luxury vehicle called the Imperial at the plant, but recently ditched those plans because, it said, the high cost of gasoline and expected higher fuel-efficiency requirements made the project unrealistic.

 

Where is it written in our Constitution that the Gov. has to stick their nose in private business affairs. I can see if its illegal, but won't the buying public dictate the cars sales. To put a limit on gas mileage that seems to be out of reach except for 4 cylinder cars and light SUVs. Will someone tell me how they got involved in this. I want protection and liberties promised by the Constitution. How we got to this point I do not know.Do they regulate clothes, should we start making them in smaller sizes, that way people would have to stop growing in size. Only have small portions at resturants, so people will eat less. And again lose weight. That way we help the health industry and keep people healthier.... RIGHT. They should stay out of things that are not their affair. They can't run what they have very efficiantly and they want to tell someone else how to run their deal. Sorry, that just burns my tail.