Stellantis, the world's fourth-largest carmaker, has announced a significant investment of $13 billion over the next four years, aimed at expanding its manufacturing capacity in the United States. The automaker states that this initiative will lead to a 50% increase in domestic vehicle production and the addition of more than 5,000 jobs across various states, including Illinois, Ohio, Michigan, and Indiana.
This substantial investment is particularly focused on supporting the introduction of five new vehicles, among them a Dodge Durango to be manufactured in Detroit and a midsize truck to be assembled in Toledo, Ohio. Stellantis has plans to enhance its operations, which encompass 34 manufacturing plants, parts distribution centers, and research and development sites spread across 14 states.
Stellantis, formed from the merger of Fiat Chrysler and PSA Peugeot 4.5 years ago, seeks to mitigate the projected €1.5 billion ($1.7 billion) costs associated with tariffs imposed this year on vehicles produced in Canada and Mexico. The strategy involves bolstering North American profitability through new model launches, including a renewed version of the Jeep Cherokee, which had been discontinued previously.
In addition to launching new products, Stellantis is also planning to refresh 19 existing products across all U.S. assembly plants, along with updates to powertrains scheduled through 2029. CEO Antonio Filosa emphasized that this investment represents the largest in the company's history, intending to enhance growth, strengthen the manufacturing footprint, and create more American jobs.
Currently, Stellantis produces 16 million cars for sale in the U.S. market, with 8 million of those manufactured in domestic plants. An additional 4 million are produced in Canada and Mexico, featuring a substantial number of U.S. components. The remaining 4 million vehicles are imported from Europe and Asia and contain virtually no U.S. components.
Filosa has further indicated plans to relaunch models previously discarded by management, such as a new Jeep Cherokee, set to be produced in Mexico, and a redesigned Dodge Charger. This move is part of a broader strategy for a U.S. turnaround, coinciding with noticeable losses reported earlier this year that reached €2.3 billion (nearly $2.7 billion). During this period, U.S. shipments dropped by almost 25%, largely due to the company reducing imports of vehicles produced abroad.
Following the announcement, shares in Stellantis experienced a sharp decline, falling 4.8% during regular trading hours and continuing to drop in after-hours trading. In response to rising dealer and customer demand, Stellantis relaunched the Ram Hemi V8 engine earlier in the year, showcasing the company's adaptability in meeting market needs.
