Mr. Marchionne also confirmed previously reported plans to transfer production of the Jeep Cherokee out of Toledo in order to continue building the next-generation Wrangler.
He said that was the only arrangement that made financial sense. The added Wrangler production will use the space where Cherokees are made.
“I had no other choice, and we were boxed into that notion because of the desire to keep the Wrangler. Once you made that the unequivocal choice as Toledo, and you said you must keep it here, I complied,” he said, noting that Fiat Chrysler’s plan for the plant won’t require help from the city or state.
“I cannot go out there and make the inordinate economic decision of building additional capacity in Toledo to satisfy both the Cherokee and the Wrangler.”
Doing that, Mr. Marchionne said, would have required $1.5 billion beyond what Fiat Chrysler will spend to retool for the next-generation Wrangler in Toledo.
The city controls about 300 acres of vacant land west of Jeep’s Toledo Assembly Complex, including some land that was purchased in hopes of a Fiat Chrysler expansion.
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One key piece of land was the 28-acre site of the former Textileather plant. Remediation work continues on that property.
While the plant couldn’t expand without more land, Mr. Marchionne said land alone couldn’t change the economics.
“It would have been very naive thinking in anybody’s mind to think that just owning land next to the plant would have somehow made up for the cost difference,” he said.
The city and state explored other incentives, though exactly what they offered, or were prepared to offer, remains private.
City officials are hopeful some of that land could be used by Fiat Chrysler, though it’s not clear what the state of discussions is between company and the city.
That said, Bill Burkett, Toledo’s economic development commissioner, said the city’s main goals were preserving the jobs at the complex and keeping the Wrangler, both of which seem accomplished.
Earlier Monday, Mr. Marchionne said the company’s plans for its Toledo Assembly Complex and other Fiat Chrysler plants will become clearer on Jan. 27 when the automaker releases its fourth-quarter financial results.
“I think there’s good news for everybody around,” he said. “Let’s wait until the end of January.”
Fiat Chrysler is looking at a number of moving pieces as it revamps its North American manufacturing. Mr. Marchionne said the changes will be significant, though no plants will be closed.
Last fall, Fiat Chrysler agreed to a four-year labor contract with the United Auto Workers that outlined plans for new products at the Toledo Assembly Complex in 2017 and 2018.
Details were not provided in the contract, though union officials have indicated the Cherokee will be produced in Toledo at least through the end of this year.
Fiat Chrysler also promised in the UAW contract that no jobs would be lost, including those at suppliers Mobis and Kuka, which are on site at the Toledo complex.
Asked about employment levels Monday, Mr. Marchionne again said no jobs would be lost. In fact, he said there’s the potential for added jobs down the road.
Still, it’s unclear how a Wrangler-only factory would have the same employment demands as the facility currently does.
The Toledo Assembly Complex built almost 539,000 vehicles last year, 294,000 of which were Cherokees.
Mr. Marchionne said current global demand for the Wrangler is between 20,000 and 50,000 units above capacity, with more sales possible with better penetration into other global markets.
Analysts have previously told The Blade they believe a Jeep pickup could sell in the range of 30,000 units annually in the United States.
Though no concept vehicles were on hand, Mr. Marchionne said design work on the next-generation Wrangler is complete.
“It’s a great vehicle,” he said. “I think we updated design without hurting its history, which is really, really important to us.”
In the otherwise far-ranging sessions, Mr. Marchionne outlined his feelings on the need for consolidation within the industry, technological advances related to autonomous driving and electric power trains, and vehicle quality.
On the latter, he took a swipe at Consumer Reports, which has long ranked the Wrangler as one of the worst vehicles it tests. Though he said he generally respects the work Consumer Reports does, the magazine’s attitude toward Wrangler irks him.
“The Wrangler is not a recommended product by Consumer Reports, and the reason why it’s not recommended is because they don’t like the vehicle,” he said.
“They don’t like it because their standards of what a car ought to look like and smell like and feel like is not what a Wrangler looks like. I don’t know the bloody reason, by the way. It’s the most sought-after car we produce; it’s got the highest level of satisfaction from consumers, the highest resale value, [and it is] the most undiscounted vehicle in the fleet.”