Toledo Blade reporter Tyrel Linkhorn got sucked in by Fiat CEO Sergio Marchionne's misleading email to Chrysler employees today. The Politico's Alexander Burns relayed Linkhorn's gullibility to the rest of the nation -- or at least the few people scattered throughout the nation who might bother to read it.
Marchionne, as quoted by Linkhorn told employees that "Jeep assembly lines will remain in operation in the United States and will constitute the backbone of the brand. It is inaccurate to suggest anything different." While that may be true, it doesn't change the fact that the company announced plans to build a new Jeep model in Italy which will be exported to Europe and North America. As Bloomberg reported early this afternoon:
Marchionne, 60, has said Jeep has the best opportunity among all of Chrysler’s brands to succeed globally. Fiat, which is working on a production plan for Europe to account for the region’s slumping demand, said today that it will build a small Jeep in Italy for export beginning in 2014.
The Jeep, which wasn’t identified by name, is a new model for Europe and the U.S. that isn’t currently in production, according to a Fiat presentation. A small Jeep was among the 66 new and existing vehicles that Marchionne showed at a convention last month in Las Vegas, according to dealers who asked not to be identified because the meeting was private.
Since its bankruptcy in 2009, Chrysler has announced about $4.2 billion in investments for Jeep models and plants that produce them in Detroit; Belvidere, Illinois; and Toledo, Ohio. The three investments will add about 5,700 jobs combined by next year, Marchionne wrote today in his message to employees.
While that investment and the job additions (if the figures are truly correct) are indeed nice, it doesn't change the fact that Fiat will be making a Jeep model in Italy which could have been made here. If the company continues to choose Italy or any other locale outside the U.S. for Jeeps to export to America, older models made in the U.S. will gradually move through their product life cycle. If they're not replaced with newer models, at some point U.S. production will end up coming down and the need for the entire cast of current U.S. workers will diminish.
Thanks to the non-business press's obsession with playing "gotcha" on Mitt Romney and his comments about Fiat and China, Marchionne has just pulled a fast one, and now has set a precedent that he can make Chrysler and Jeep branded vehicles overseas and export them to the U.S. and the rest of North America without objection. Way to go, guys.
Cross-posted at BizzyBlog.com.
