Chrysler may invest in Kenosha, 2 other plants

Company to spend $2 billion, trade publication reports

JS ONLINE, THOMAS CONTENT, KENOSHA - - An auto industry trade publication is reporting that DaimlerChrysler AG is preparing to invest $2 billion at three plants, including one in Kenosha, as it prepares to unveil a new V-6 engine.Quoting union sources, Automotive News said DaimlerChrysler will seek to build engines for both Mercedes and Chrysler vehicles in Kenosha; Trenton, Mich.; and Toledo, Ohio.

Gov. Jim Doyle met with Chrysler Group President and Chief Executive Tom LaSorda in Detroit more than a month ago in a bid to show the state's willingness to pitch in to help secure an investment in Kenosha, Doyle spokesman Matt Canter said. Chrysler Group is the Detroit-based subsidiary of DaimlerChrysler.

Michele Tinson, a Chrysler Group spokeswoman, said the company has nothing yet to announce regarding the potential investment in the plants. A Mercedes plant in Germany also would make the engines, Automotive News said this week.

"We are reviewing the potential opportunities for each of those venues," she said of Kenosha, Trenton and Toledo. Tinson said a decision is likely to be announced before the end of the year.
In April, workers at the Kenosha plant agreed to work rule changes as a way to lure new DaimlerChrysler investment.

Last month, 214 workers in Kenosha were laid off indefinitely after the company decided to shift production of 4.0-liter engines for the Jeep Wrangler to the Trenton plant.

The Kenosha plant continues to employ about 1,050 workers, DaimlerChrysler said.
According to Automotive News, DaimlerChrysler is looking to invest about $500 million in Kenosha, $800 million at Trenton and $700 million at Toledo, with Kenosha projected as "probably" the first one to produce the new engines, which are expected to debut on 2010 model vehicles.

The new V-6 engine would replace four different types of V-6 engines now made by Chrysler plants, including those made in Kenosha, Automotive News reported.

Union officials in Kenosha couldn't be reached for comment Thursday, and they declined to comment earlier this year on specifics of the changes being sought by the company.
The Kenosha plant makes a 3.5-liter engine, used on the Chrysler Pacifica and 300, and the Dodge Magnum and Charger models, as well as a 2.7-liter engine used on the 300, Stratus, Charger, Chrysler Sebring and Dodge Magnum models.

The opening of the 3.5-liter engine line, in 2002, came after the company invested $624 million in a 450,000-square-foot expansion of the plant. The Kenosha plant was built in 1917 and was bought by Chrysler in August 1987 when it acquired American Motors. Vehicle production in Kenosha stopped in 1988.

Canter said Doyle met with LaSorda during a two-day trip to Detroit that also included a meeting with General Motors executives to discuss possible expansion opportunities for the Janesville assembly plant that makes full-size sport utility vehicles.