Chrysler Group will stop using Mitsubishi Motors’ Normal, Illinois, factory to make Chrysler and Dodge cars next year, according to a Detroit News report.
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The paper said the companies still plan to develop new models together and share parts and engines but Chrysler is expected to shift production of its next generation mid-size models — now sold as the Chrysler Sebring and Dodge Stratus — to Chrysler plants in Sterling Heights and Belvidere, Illinois – the move could mean more jobs at those factories.
According to the report, Chrysler spokesman Jason Vines said the decision to stop using the Normal plant was made before DaimlerChrysler decided not to provide additional financial support to bail out Tokyo-based Mitsubishi Motors, which it owns 37%.
The Detroit News said the Illinois plant makes Mitsubishi Galant sedans, Endeavor sport utility vehicles, and Eclipse coupes and Spyder convertibles, as well as Chrysler Sebring and Dodge Stratus coupes – Chrysler’s Sterling Heights plant currently builds the Stratus and Sebring sedans, and the Sebring convertible.
The paper noted that Mitsubishi plans production cuts at the Illinois plant as part of a $US4 billion revival plan.
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By GlobalDataLast October, Mitsubishi said it would trim as many as 425 jobs at the factory and scrapped a $200 million expansion plan, the Detroit News added.
“It’s essential for Mitsubishi Motors to have a high plant utilisation rate, and for Chrysler to pull out its production is clearly a bad thing,” said Yasuhiro Matsumoto, a credit analyst with BNP Paribas Securities in Tokyo, told the paper. “It raises questions about the other projects Mitsubishi Motors and DaimlerChrysler are working on, even though they claim those projects will continue.”
Vines reportedly said the vehicles that Chrysler and Mitsubishi are jointly developing are going forward as planned.
“All the joint products for Chrysler will be built in Chrysler production facilities, with most of it likely going to Sterling Heights and Belvidere,” Vines told the Detroit News.
Production of the Sebring and Stratus models will end at the Normal plant in June 2005, the report added.
