To make more Ram trucks, Fiat Chrysler reconsiders Mexico

Fiat Chrysler Automobiles NV's new CEO is tired of being No. 3 in US pickup truck sales.

With a strategy of loading up its revamped Ram 1500 full-size trucks with new features - ranging from 12-inch touch screens on the dashboard to large battery packs and electric motors to help adjust speed and gears and conserve fuel - the automaker is banking on a sustained surge in demand.

So Chief Executive Mike Manley is now reconsidering a decision announced in January to stop building Ram heavy-duty pickups at a plant in Saltillo, Mexico. That plant, and another in Warren, Michigan, between them would produce other Ram models and free up manufacturing capacity to make even more new trucks to eat into sales of Ford Motor Co's F-Series or General Motors Co's Chevrolet Silverado, and its higher-end GMC Sierra.

“We need to get ourselves into second” place, Manley told Reuters exclusively in his first interview since taking over the No. 7 global automaker after Sergio Marchionne died suddenly. “Frankly, I don't care which of the two I take share from.”

When US President Donald Trump was threatening action that would have imposed a 25 percent tariff on Mexican-made pickup trucks earlier this year, Fiat Chrysler said Saltillo would be “repurposed to produce future commercial vehicles.”

In 2017, Marchionne had raised the possibility his company could move heavy-duty pickup production out of Saltillo, saying US tax and trade policy would influence the decision.

Now, the United States, Mexico and Canada have a tentative trade agreement that imposes no ceiling on shipments of pickups to the United States from Mexico, provided they meet thresholds for the share of parts produced within the region.

“With a combination of Warren and Mexico building what we call the classic truck, we have enough production to increase output next year if it's required,” Manley said.

“In my opinion it will be required. We are gaining share. Obviously I am looking for that to continue, but it's an incredibly competitive segment,” he added.