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Chrysler struts new lineup, revamped Jefferson plant


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Chrysler struts new lineup, revamped Jefferson plant

CEO: We're on track to pay loans



Chrysler's 2011 Jeep Grand Cherokee hasn't gone on sale yet, but CEO Sergio Marchionne said the Jefferson North assembly plant that builds the iconic SUV will add 1,080 jobs for a second shift starting in mid-July.

"Nearly all" those jobs, he said, will be filled by new hires earning a lower wage of about $14 an hour.

Almost one year after a government-funded bankruptcy restructuring that saved the Auburn Hills automaker, Chrysler turned Friday's Grand Cherokee launch into a revival meeting for the 1,700 workers at the plant.

"The best workforce in the world is right here in the Motor City," said Gov. Jennifer Granholm, who was in attendance.

But Chrysler and its new SUV face challenges. Chrysler's sales are up 1.9% for the year -- below the industry's gain of 16.7% -- and Grand Cherokee sales have been in decline since they peaked over 300,000 annual sales in 1999.

The all-new Grand Cherokee, however, offers more fuel economy than the SUVs of the past. With a more aerodynamic design and a new base V6 engine made downriver in Trenton, the Grand Cherokee will offer 23 m.p.g. on the highway, up from 21, on a current 4x2 model.

Inside, the Grand Cherokee also looks more like a luxury vehicle.

After bankruptcy, there's reason to celebrate

Chrysler showed tangible evidence Friday of recovery -- a 2011 Jeep Grand Cherokee that comes to market with a vastly improved interior and new V6 engine that will get a few extra miles per gallon than its predecessor.

The recent downward trend in gas prices may give Jeep's steak-and-potatoes SUV just the boost it needs for a fast start out of the gate.

The automaker's executives and 1,700 workers at the Jefferson North assembly plant seemed relieved to show outsiders a ready-for-sale vehicle and an upgraded plant in which the company invested nearly $700 million.

Ever since emerging from bankruptcy last June, Chrysler has been pestered by questions about when it would deliver new products. A presentation last November of its 5-year plan partially answered those questions, but having sheet metal to show makes a difference.

"Seventy-five percent of our lineup will be all new or substantially renewed by the end of this year," CEO Sergio Marchionne said at the company's Jefferson North plant, where Chrysler will add 1,080 to the current workforce beginning in July.

UAW Vice President General Holiefield welcomed the news about the new jobs, despite the fact the workers will be paid lower-tier wages for new hires, which he negotiated in 2007. "It helps us to compete with our rivals. ... We're all fired up," he said.

Despite industry-wide talk about alternative engines, hybrids and battery-powered vehicles, Jeep's gasoline-only SUV is driving the company's first major production hiring since a series of buyouts that helped pare its hourly workforce during the two years leading up to its April 2009 bankruptcy.

The plant -- which opened in 1992 to make the first of what are now four generations of the Grand Cherokee -- has undergone a major face-lift inside.

A new body shop, where most of the plant's 600 robots precisely weld fenders, doors and roofs, gives Chrysler the flexibility to make multiple models with different body styles. A seven-seat Dodge SUV that shares the Grand Cherokee's structural foundation is to go into production at the plant later this year.

The entire plant is showered in a new lighting system that is both brighter and more energy efficient than the one it replaced.

From a design perspective, the new Grand Cherokee is softer looking and more aerodynamic. There's a bit more chrome than in the outgoing model. The more striking difference is in the interior, where richer materials and closer attention to detail appear more comfortable.

There are three trim versions of the Grand Cherokee: the Laredo, the Limited and at the upper end of the price range, the Overland.

All come with a choice of 4x2 or 4x4 powertains. Starting prices range from $31,000 to about $43,000. The base models feature Chrysler's new 3.6-liter, V6 Pentastar engine that gets 23 m.p.g. on the highway for the 4x2 powertrains, up from 21 m.p.g. in the 2010 model.

Those who need stronger hauling muscle can select the 5.7-liter Hemi V8.

Marchionne said Chrysler is still on track to repay part of $7.1 billion in loans to the U.S. Treasury next year and all of the loans by 2014.

The U.S. government currently owns 9.9% of Chrysler's stock. Fiat owns 20%, the UAW's retiree health care trust owns about 68% and Canada owns 2.1%. Chrysler eventually will sell shares to the public, which would allow the governments and the UAW to sell part or all of their stakes to raise cash.

Marchionne said that stock offering could come in 2011 depending on market conditions.

"Just don't ask me which month," he said.

The plant also is expected to add a Dodge SUV sharing the Grand Cherokee's underpinnings near the end of this year.



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