After releasing a devastating earnings report, Fiat Chrysler says it has a plan to reopen its plants.
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Fiat Chrysler is confirming what I first reported on April 28th, that the company intends to reopen its plants and resume building 2020 Ram 1500s on May 18, 2020 . The COVID-19 crisis has caused tremendous uncertainty in the automotive industry as the Detroit Three automakers negotiate plans to reopen their facilities and get employees back on the production lines. It is unclear how long it will take plants to gear up or when the first vehicle will roll off the production lines but Ram is key to the company’s profitability and is considered a priority. Skeleton crews are expected to make necessary safety changes before workers return to the plants.
UAW Response to Opening Date
UAW President Rory Gamble released this statement this morning about Fiat Chrysler’s plan to reopen.
“We continue to advocate for as much testing as possible at the current time and eventually full-testing when available.
As for the start date, the companies contractually make that decision and we all knew this day would come. Our UAW focus and role is and will continue to be, on health and safety protocols to protect our members.
My own family will be among those reporting and my responsibility to our UAW members and my family will be consistent. We must implement and follow these guidelines and self-reporting procedures we have worked out. And the UAW will fulfill its role to continue to actively monitor and aggressively respond regarding all issues impacting the health and safety of UAW members in whatever manner may be necessary as we return to the worksite.”
COVID-19 Causing Huge Financial Loss
Fiat Chrysler CEO Mike Manley confirmed the dates for reopening plants after announcing that FCA lost $1.84 billion during the first three months of the year. When it announced U.S. financials earlier this year, FCA said Ram was its only brand that actually made money. Ram pickup truck sales were up 7 percent to 128,805 vehicles. Overall, the Ram brand rose 3 percent to 140,486 vehicles. Sales for the 2020 Ram 1500 were very strong up until the middle of March when production was halted because of the virus.
COVID-19 Safety Issues
There are issues concerning safe social distancing inside the plants. To help make sure that the UAW members feel safe enough to go back into the facilities, Ram plans to increase the space between workers on the line, install Plexiglas at some work stations and stagger start times so crews have more time to clean different work stations. Workers may also be required to wear some protective gear like masks or shields.
Restarting Ram Production Expected to Be Fiat Chrysler Priority
Ram insiders aren’t saying how many 2020 Ram 1500s will be have to be built before Ram switches over to the 2021 models. The Ram models are top sellers for FCA and they also create some of the highest profits, so Ram production is critical for FCA. All of the auto companies have been forced to delay their annual changeover or retooling schedules because of the loss of production. If the plants do resume May 18th, the companies will have lost nearly two months of production. CEO Manley suggested that they have worked with governor of Michigan in making the decision on the date to reopen plants, but depending on what happens with COVID-19, there could still be complications. The company had originally hoped to reopen the facilities this week, but that was pushed back out of what insiders call “an abundance of caution”.
Fiat Chrysler indicates that all of its North America plants will reopen May 18th, except for the plant in Belvidere, Illinois, which builds the Jeep Cherokee. Belvidere Assembly is expected to reopen on June 1.
At this point, General Motors and Ford are not confirming when they intend to resume production, although it is believed they are all hoping to have plants operating as of May 18th.
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