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Fiat Chrysler Was Going to Stop Producing Trucks in Mexico. Then the New Nafta Happened

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Hallie Detrick
Hallie Detrick
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By
Hallie Detrick
Hallie Detrick
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October 29, 2018, 7:41 AM ET
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Fiat Chrysler (FCAU) may not have to bring production back to the U.S. after all.

Before President Trump even took office, then-CEO Sergio Marchionne announced the company may have to move production out of Mexico if Trump were to follow through on his plans to tariff imports from Mexico. But now that there’s a new trade agreement between Canada, the United States, and Mexico, and that tariff plan is out the window, it looks like Fiat Chrysler’s Saltillo plant in Mexico may play a huge role in the company’s plan to become number two in U.S. pickup truck sales.

The company’s new CEO Mike Manley, who took over when Marchionne died suddenly over the summer, told Reuters that the plant in Mexico, along with one in Warren, Mich., would be essential to his plan to overtake Ford (F) or GM (GM) to move out of third place in pickup sales. Keeping those two factories open and producing Ram trucks would free up capacity elsewhere to focus on Fiat Chrysler’s new bid for market share, which is based on a truck offer that is more fuel efficient, easier to shift, and kitted out with an optional 12-inch touch screen display on the dashboard.

The plan seems to be working. In the year through late October, Rams sold for about $4,000 more on average than competitor Ford F-150.

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