DETROIT: Fiat Chrysler Automobiles on Sunday said it will invest $1 billion to modernize two plants in the US Midwest and create 2,000 jobs, upping the ante as automakers respond to threats from President-elect Donald Trump to slap new taxes on imported vehicles.
FCA’s announcement that it would retool factories in Ohio and Michigan to build new Jeep sport utility vehicles, including a pickup truck, and potentially move production of a Ram heavy-duty pickup truck to Michigan from Mexico, also highlighted the auto industry’s keen interest in getting relief from tough fuel economy rules enacted by the outgoing Obama administration.
General Motors Co. Chief Executive Mary Barra on Sunday said tax reform and “streamlining regulations ... are just two areas that would be extremely beneficial” for Trump to address. Trump has criticized GM for building cars in Mexico while laying off workers in the US.
Barra, who is on an advisory committee to Trump, told reporters that decisions about where to build specific vehicles are made “two, three four years ago.” Overall, she said of Trump, “we have much more in common than we have different.”
Barra had a conversation with Trump on Tuesday, a person briefed on the call told Reuters. Barra declined to discuss her conversations with Trump.
Many automakers plan to use the annual North American International Auto show in Detroit, which started on Saturday, to tout investments in the US and a commitment to US employment against the backdrop of Trump’s criticism of automakers for shipping vehicles into the US from Mexico.
Daimler AG Chief Executive Dieter Zetsche on Sunday said during an auto show event that the German automaker plans to invest another $1.3 billion to expand sport utility vehicle (SUV) production at a factory in Alabama.
Automakers are girding for rounds of questions about Mexican investments and US jobs in the wake of Trump’s harsh criticism of automakers.
Most of the major automakers in the US have substantial vehicle making operations in Mexico, as well as complex networks of parts makers that supply their factories in the US and support jobs and investment in states such as Ohio and Michigan.
FCA’s investment decisions were not related to Trump’s recent attacks Ford Motor Co, GM and Toyota Motor Corp. for building cars for the US market in Mexico, people familiar with company’s moves said on Sunday.
The company had already signaled plans to expand truck and SUV production at its US plants, and discontinued production of small and medium-sized cars in two US factories.
FCA executives did not confer with Trump before making the decision on the new big SUVs and a Jeep pickup truck, according to a person familiar with the company’s thinking.
The same source said FCA CEO Sergio Marchionne wanted to get out the news about adding jobs and investment in the US in case the company encounters more criticism from Trump.
Still, Fiat Chrysler’s announcement landed as global auto industry executives gathered for the annual auto show in a climate of growing uncertainty about the trade and regulatory policies the new Republican administration will pursue.
Trump, who will be inaugurated on Jan. 20, has talked about rolling back environmental regulations, and supporting corporate tax cuts — moves automakers would welcome.
He has just as explicitly warned that he will move to raise the costs of importing vehicles from Mexico, a policy industry executives said could hurt their businesses.
Since Trump’s election, automakers and other companies have played up their investments in the US.
Last week, Ford scrapped plans to build a $1.6 billion plant in Mexico and invest $700 million in a factory in Michigan. Ford will still move production of Focus small cars to Mexico, but will instead cut total production of the cars by consolidating their assembly in an existing Mexican plant.
Hinrich Woebcken, chief executive of the North America Region for German automaker Volkswagen AG, told Reuters on Sunday the automaker plans to invest $7 billion in the US between 2015 and 2019 and will start building its new Atlas SUV in Tennessee later this year.
Volkswagen has had a plant in Mexico for 50 years and it is not shifting any jobs to Mexico from the US.
“We do not make our investment decisions based on administrative cycles. Our business is really an 8-, 12-, 14-year horizon when we look at investments,” Woebcken said on the sidelines of the Detroit auto show.
FCA said a plant in Warren, Michigan, near Detroit, would make the Jeep Wagoneer and Jeep Grand Wagoneer SUVs, while a Toledo, Ohio, factory would produce the Jeep pickup.
The company said the production plans in Ohio and Michigan were “subject to the negotiation and final approval of incentives by state and local entities.”
US consumers have increasingly shifted toward SUVs and pickup trucks and away from sedans in recent years, as gasoline prices have remained relatively low.
A year ago, Marchionne said FCA would cease production of two sedans and focus on SUVs and pickups.
Marchionne said in a statement on Sunday that the lineup changes were due to that consumer shift.
“We continue to reinforce the US as a global manufacturing hub” for SUVs and pickup trucks, he added.
Fiat Chrysler ups the ante as automakers respond to Trump
Fiat Chrysler ups the ante as automakers respond to Trump
‘Get in the queue now, win the game’ — why fusion energy could solve global energy dilemma
DAVOS: Fusion energy is closer to commercial reality than many assume, and countries in the Gulf could be among those best positioned to benefit if they move early, executives at Commonwealth Fusion Systems told Arab News in Davos.
Speaking at the World Economic Forum, Rick Needham, chief commercial officer at CFS, said that the company was on track to demonstrate net energy gain from fusion within the next two years. “We are building a demonstration device right now outside of Boston,” he said.
“That’s expected to turn on in 2027 and hit net energy gain, producing more energy out of the reaction than goes in,” he added.
“If you’ve ever played the video game SimCity, fusion is the last card you play,” Needham said.
“You build coal, oil and gas, and then there’s a fusion power plant. Once you get fusion, the game is essentially won.
“From a fuel perspective, fusion is effectively a limitless energy source, the fuel comes from water, it’s abundant, and it’s available everywhere, which fundamentally changes the energy equation.”
For Middle Eastern economies investing heavily in artificial intelligence, data centres and next-generation infrastructure, Needham argues that fusion represents not just a clean energy source, but a competitive advantage.
“If you want to be a leader in AI, you have to be a leader in energy,” he said. “Power has become the binding constraint.”
And CFS believes commercial fusion is now within reach.
The company is currently building SPARC, the demonstration fusion device outside Boston. It will generate about 100 megawatts of thermal power, paving the way for CFS’s first commercial power plant, ARC, a 400-megawatt net facility planned in Virginia through a partnership with Dominion Energy.
Google has already committed to purchase half of ARC’s output. Construction is expected to begin around 2028, with power coming online in the early 2030s, they explained to Arab News.
Jennifer Ganten, chief global affairs officer at CFS, said that fusion’s shift from theory to execution is what sets this moment apart.
“We use a magnetic confinement approach known as a tokamak, which has been studied and built for decades,” she said. “What hasn’t existed before is a design optimised for commercial power.”
She continued: “For us, this is no longer a physics challenge, it’s an engineering and systems integration challenge, and those are problems we know how to solve.”
That distinction, she said, is why fusion has started appearing more prominently on policy and investment agendas, including in the Middle East.
“Energy demand is rising everywhere, and the push for AI leadership is accelerating that,” Ganten said. “Fusion has begun to feature not just at energy conferences, but at forums like COP in Dubai and here at Davos.”
A critical factor in determining where fusion plants are ultimately built will be regulation and how quickly governments move to put frameworks in place.
“Fusion should not be regulated like nuclear fission,” Ganten said. “There’s no chain reaction, no risk of meltdown, and no long-lived radioactive waste.”
She pointed to the UK and US, which regulate fusion similarly to particle accelerators, as early movers. Germany, Canada and Japan have since followed.
“Getting regulation right makes a country an attractive market for deployment,” she said. “It lowers cost, reduces timelines and signals seriousness.”
Needham said that the difference is material. “Instead of five to ten years and hundreds of millions of dollars for licensing, fusion projects can move in roughly 12 to 18 months,” he said. “That changes everything.”
For Gulf states accustomed to long-term energy planning, both executives stressed that waiting for fusion to be fully proven could mean missing out on early deployment.
“If you wait until fusion is obvious, you’re at the back of the queue,” Needham said.
“The countries that start preparing now, with regulation, grid planning, supply chains, they will be at the front.”
Ganten agreed. “Once fusion is demonstrated at scale, demand will spike very quickly,” she said. “The jurisdictions that created the right conditions early will secure the first plants.”
Beyond decarbonization, fusion offers energy security, a powerful proposition for governments seeking resilience in a volatile geopolitical climate.
“Fusion breaks the link between energy and fragile global fuel supply chains,” Needham said.
For Middle Eastern economies balancing growth, sustainability and technological ambition, fusion may not just be a future option, but a strategic decision about when to get in line.
As Needham puts it, getting fusion can “win you the game.”
