MARYSVILLE, Mich. -- Financially strapped Chrysler is going ahead with its joint venture with ZF Friedrichshafen to make axles at a new plant here.
Production will begin in 2010 for 2011 models. The partnership will allow ZF to make axles for Chrysler and other customers in North America.
Initially, the plant will employ about 350 workers on two shifts. Originally, Chrysler had said it planned to employ about 900. The workers, who will be Chrysler employees, will be represented by the UAW.
German supplier ZF will run day-to-day operations. Chrysler owns the plant, about 55 miles northeast of downtown Detroit. But ZF will buy the manufacturing equipment, a move that will help cash-strapped Chrysler save money, said Chrysler co-President Tom LaSorda.
ZF CEO Hans-Georg Haerter said Chrysler is the only customer for now, but his company is looking for others.
“This partnership with Chrysler and the UAW further demonstrates ZF’s intention to increase market presence with axles and to use this as a foundation for future explorations with additional customers,” said Haerter.
He said ZF’s German customers -- such as Volkswagen AG, BMW Group and Daimler AG -- could be prime candidates. ZF also wants to lure Asian automakers, Haerter said.
Robert Lee, Chrysler’s vice president of powertrain product engineering, said the ZF axle systems will produce a fuel economy savings of 2 to 3 percent vs. comparable vehicles. The Marysville plant will make a solid-beam rear axle and two aluminum axles for vehicles with independent suspensions -- one front and one rear.
Lee said the axles could be used on vehicles such as the next-generation Jeep Grand Cherokee, the next-generation Chrysler 300 and Dodge Charger sedans and future Dodge trucks. The axles can be used on Chrysler vehicles powered by a new generation of V-6 engines, due in 2010.
Workers at Chrysler’s Detroit axle plant will get preference for jobs in Marysville. Production here will be phased in during 2010 and 2011 while it is phased out at the Detroit plant.
Officials declined to divulge the investment in the plant, but Chrysler earlier had said it would be about $700 million.
ZF, of Friedrichshafen, Germany, ranks No. 10 on the Automotive News list of the top 100 global suppliers, with estimated sales to automakers of $15.10 billion in 2007. ZF employs 58,000 people.
