UAW official: Sterling Heights plant may stay open past 2010

Wednesday, August 26, 2009

UAW official: Sterling Heights plant may stay open past 2010

Alisa Priddle / The Detroit News

Chrysler Group LLC could delay the closing of its Sterling Heights sedan plant to buy time for new models to be developed with Fiat SpA, according to a union official.

The plant is one of eight Chrysler factories slated to be shut down under the agreement that created Chrysler Group in an alliance with Italian automaker Fiat SpA after Chrysler filed for bankruptcy.

"I believe they haven’t made up their mind," said Bill Parker, president of United Auto Workers Local 1700, which represents workers at the Sterling Heights plant, set to close in December 2010. About 1,300 people work at the plant.

Parker said extending the factory’s life for a year or more is one option on the table, as is closing as scheduled.

Chrysler declined to confirm the possibility of keeping Sterling Heights open longer.

"We have not announced any changes to that plan," spokesman Max Gates said.

The decision to close the plants and leave them behind in bankruptcy as bad assets to be liquidated was made by the management of Chrysler LLC. The bankrupt company’s best assets were sold to Fiat to create Chrysler Group LLC.

The new Chrysler is operating under Fiat management and adopting Fiat’s manufacturing system to build vehicles for both automakers.

A number of past decisions have been overturned since Fiat CEO Sergio Marchionne added the job of Chrysler CEO to his responsibilities.

The Dodge Viper and Chrysler PT Cruiser were to be discontinued, but have been given reprieves. A third shift of minivan production in Windsor, Ontario, was restored after Chrysler had said it would end.

"Past decisions are being overlaid by the Fiat production system," said Jim Hall, an auto industry analyst with 2953 Analytics in Birmingham.

Fiat "can see opportunities others can’t," Hall said, with a system that is faster, more flexible and can get more input from a plant that others might have concluded is tapped out or not worth saving.

"The analysis they (Fiat) are doing has a whole layer we’re not privy to," he said.

Parker is hoping the analysis translates into Sterling Heights gaining a temporary reprieve as Chrysler finalizes its future product plan and recognizes the value in continuing to make existing products as replacements are being developed.

In the interim, the Sebring and Avenger are expected to receive updates, especially to their interiors.

The Insurance Institute for Highway Safety on Tuesday awarded the 2010 Chrysler Sebring and Dodge Avenger its top safety rating. The automaker said the midsize cars feature pre-tensioning seat belt retractors and supplemental side-curtain air bags, plus responsive steering, braking, handling and electronic stability control.

But UAW leader Parker does not expect the plant to survive long term because it needs to replace its 25-year-old paint shop to get new products, and that appears unlikely.

A new paint shop was announced in 2007 but then canceled due to economic woes at Chrysler.

Parker said a rally to save the plant is planned for Sept. 25 at 2:30 p.m.

His hope is the plant’s life can be extended long enough for auto sales to rebound, leading management to decide it needs to keep it in production.

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