Fiat Chrysler (FCAU) To Build Jeep In Idled Detroit Plant

Per Reuters, Fiat Chrysler Automobiles N.V. (NYSE:FCAU) announced that it will build Jeep Grand Cherokee SUVs in an idled Detroit plant in 2020. This carmaker intends to renew Mack Avenue Engine II, which has been mothballed since 2012. This will create additional capacity to manufacture the redesigned Grand Cherokee, including a new three-row version.

Fiat Chrysler manufactures the two-row Grand Cherokee at the Jefferson North plant and it requires additional capacity. The latest move is likely to add at least 100 jobs and at the most 400 in the city.

This move by Fiat Chrysler coincided with General Motors Company’s (NYSE:GM) plan to shut five assembly plants in North America in 2019, and cut up to 15,000 jobs because of fragile demand for sedans and small cars in the United States.

Notably, General Motors has been receiving severe criticism from the lawmakers as well as President Donald Trump for its plan. Even the company was asked to reverse its plans.

In late November, Fiat Chrysler announced that it will spend over 5 billion euros ($5.7 billion) on its plants in Italy over the period between 2019 and 2021. The company will make this investment in new models and engines in order to utilize the factories in a better way as well as to boost jobs and margins.

Over the past year, shares of Fiat Chrysler have outperformed the industry it belongs to. Over this time frame, shares of the company have decreased 14.3%, whereas the industry declined 24.5%.



Zacks Rank & Key Picks

Currently, General Motors carries a Zacks Rank #2 (Buy) and Fiat Chrysler has a Zacks Rank #3 (Hold).

A couple of better-ranked stocks in the auto space are Allison Transmission Holdings, Inc. (NYSE:ALSN) and Fox Factory Holding Corp. (NASDAQ:FOXF) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Allison Transmission has an expected long-term growth rate of 10%. Over the past six months, shares of the company have increased 3.8%.

Fox Factory has an expected long-term growth rate of 17.9%. Over the past six months, shares of the company have risen 45.5%.

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General Motors Company (GM): Free Stock Analysis Report

Fox Factory Holding Corp. (FOXF): Free Stock Analysis Report

Fiat Chrysler Automobiles N.V. (FCAU): Free Stock Analysis Report

Allison Transmission Holdings, Inc. (ALSN): Free Stock Analysis Report

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