Fiat CEO says Jeep production isn’t moving to China

The CEO of the Italian auto company that owns Chrysler is wading into the contentious debate over whether production of the company's Jeep brand is moving to China.

Reports about Chrysler’s plans have roiled the presidential campaign between Mitt Romney and President Obama in perhaps the most important swing state of the 2012 campaign: Ohio.

The Romney campaign is airing an ad in a number of Ohio television markets that attacks Obama’s bailout of the U.S. auto industry and says Jeep is planning to build vehicles in China.

In an email to Chrysler employees obtained by the Detroit News, Fiat CEO Sergio Marchionne said the company has no plans to move Jeep assembly lines from the United States to China.

“Chrysler Group's production plans for the Jeep brand have become the focus of public debate,” Marchionne wrote. “I feel obliged to unambiguously restate our position: Jeep production will not be moved from the United States to China.”

Marchionne said Chrysler plans to add production facilities in Asia to meet growing demand, but emphasized that those assembly lines would be in addition to U.S. capacity.

“Together, we are working to establish a global enterprise and previously announced our intent to return Jeep production to China, the world's largest auto market, in order to satisfy local market demand, which would not otherwise be accessible.Chrysler Group is interested in expanding the customer base for our award-winning Jeep vehicles, which can only be done by establishing local production,” Marchionne wrote.

Romney seized last week on a report from Bloomberg News that said Chrysler was considering producing cars in China. His campaign quickly released a television ad in Ohio that said Obama took “GM and Chrysler into bankruptcy” and “sold Chrysler to Italians who are going to build Jeeps in China.”

The Obama administration helped orchestrate the deal to sell Chrysler to Fiat after the $80 billion federal bailout was given to the company and General Motors in 2008 and 2009.

The president’s campaign has pushed back on the Romney commercial with an ad that accuses the former governor of airing a "lie" about the outsourcing of Jeep production.

Romney officials point out that the Ohio ad does not say that Chrysler plans to move jobs to China, and says the Obama campaign’s argument is evidence of desperation.

Marchionne steered clear of the political implications of the back-and-forth, but said, “North American production is critical to achieving our goal of selling 800,000 Jeep vehicles by 2014.

“We also are investing to improve and expand our entire U.S. operations, including our Jeep facilities,” he wrote. “The numbers tell the story: We will invest more than $1.7 billion to develop and produce the next generation Jeep SUV, the successor of the Jeep Liberty — including $500 million directly to tool and expand our Toledo Assembly Complex and will be adding about 1,100 jobs on a second shift by 2013.”

Marchionne added that “[J]eep is one of our truly global brands with uniquely American roots.

“This will never change,” the Fiat CEO wrote. “So much so that we committed that the iconic Wrangler nameplate, currently produced in our Toledo, Ohio plant, will never see full production outside the United States. 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.”

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