Magna Steyr will manage and operate the paint shop at Chrysler’s new Toledo South assembly plant which will start production of the 2007 Jeep Wrangler in the third quarter of this year.
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Although it was not mentioned in a joint statement from the automaker and supplier, The Car Connection website noted the new deal replaces one originally struck with now-bankrupt Haden Prism LLC as part of an unusual experiment in which key suppliers take on both investment and management duties.
Haden was originally in charge of the paint shop, but its parent company was forced into US Chapter VII insolvency earlier this year, leaving that operation in the lurch and Chrysler temporarily stepped in, TCC added.
In the statement, Chrysler said it would handle final trim and assembly, the Kuka Group would build the Wrangler bodies and Hyundai Mobis (through its Ohio Module Manufacturing Company unit) would assemble the Jeep’s chassis.
All four facilities were completed earlier this year and have been producing pilot parts since April.
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By GlobalData“We are very pleased that Magna is joining this new supplier model in Toledo,” said Peter Rosenfeld, executive vice president – procurement & supply, Chrysler Group.
“Magna is one of our top-performing partners. In addition, Magna Steyr is familiar with our production processes and standards since its Graz (Austria) assembly plant builds and paints several Chrysler Group models for international markets.”
Chrysler said the co-location project between itself and the three supplier partners is a unique vehicle manufacturing operation in North America and part of a $US2.1bn investment in the Toledo assembly operations.
The supplier park is part of the group’s overall flexible manufacturing strategy, which involves a number of actions that enable multiple products to be built on the same assembly line; the ability to react quickly to changing market demands; and alternative practices to traditional vehicle assembly.
The Car Connection noted that, while paint shop workers will be on the supplier’s payroll, Magna will not actually invest any money into the Toledo project, unlike Hayden and the other, initial partners.
When first announced, Chrysler said it would commit $900 million towards the plant, with Kuka, Hyundai Mobis and Haden kicking in another $300 million, TCC said.
The first “sell-able” Jeeps will begin rolling down the Toledo assembly line this week, a DaimlerChrysler spokesman told TCC, which added that Job One is scheduled for August.
