Chrysler plans to invest USD266 million in its Kokomo transmission plant complex in Indiana, United States, to expand production of its eight-speed automatic transmission, according to an Automotive News report. The transmission is built under licence with ZF Friedrichshafen. According to the report, a recent SEC filing suggested that Fiat-Chrysler will use the transmission for all of its rear-drive vehicles, except the Dodge Viper and certain heavy-duty Ram pick-ups. The report also cites a Chrysler spokesperson saying the investment has not yet been confirmed, though Indiana media reports say that regional elected officials have approved a request from Chrysler for a 10-year tax abatement for the project. The report cites a written statement from Chrysler related to the abatement request that says the additional investment would ensure the company has flexibility to respond to the market, and that it would retain employment versus indicating increasing staff.
Significance: Chrysler's Kokomo facility builds four-, five-, six-, eight-, and nine-speed transmissions and had an output of 1.7 million units in 2013, according to IHS Automotive's transmission forecast. This number is forecast to decline by 2020, to about 1.6 million units, as the four- and five-speed automatic transmissions, which contributed 440,118 units in 2013, are phased out. Production of eight- and nine-speed transmissions is on the rise. The six-speed transmission is forecast to continue; however, instead of contributing 55.6% to the Kokomo plant's output in 2013, the transmission is forecast to account for 9.5% of plant’s production in 2020. By 2020, production of the eight-speed transmission is forecast to reach 51.6% of Kokomo production, followed by the nine-speed at 38.9%.
IHS Automotive forecasts the rear- and all-wheel drive eight-speed unit will be used for future versions of the Jeep Grand Cherokee, Grand Wagoneer, Wrangler and Wrangler Unlimited, as well as the future Alfa Romeo product pipeline, set to include a D-CUV, a 169 replacement, and the Giulia. The eight-speed transmission is currently used in the Jeep Grand Cherokee, Chrysler 300, and Dodge Durango, Charger, and Challenger, while the nine-speed automatic transmission is used for front- and all-wheel-drive applications.
