FCA reveals vendors for new Recife plant

Fiat Chrysler Automobiles (FCA), the company planned as a merger between Fiat Group and Chrysler, remains on schedule to open its new plant in Recife, Brazil with production set to roll in the second quarter 2015.

The company has recently announced the names of 11 companies that will be integrated into a new supplier park to support the new plant.

This will be Fiat's third plant in the region. With a US$1.8bn investment, Fiat’s version of the Jeep Renegade is set to be the first model down the line.

This will be followed by a Fiat pick-up in the first quarter of 2016; a Jeep SUV, also pencilled in for the second quarter of 2016; the Fiat Punto saloon is set to arrive in the third quarter of the same year; and the Fiat Viaggio will arrive in the first quarter of 2018.

Also on the cards are two passenger vehicles. Clearly, all staff involved with this new plant will find their hands full in the next four years, as only Fiat knows how.

The new facilities on the supplier park will supply 40 per cent of production parts and could account for as many as 4,500 new jobs. The new plant is sited in Goiana, a rural region with relatively low incomes and limited industrial activity; it is situated some 70km north of the Pernambuco state capital Recife.

As expected, the vendor with the lion’s share of the business is Fiat’s "old faithful" Magneti Marelli which has been assigned to build six production units for fuel tanks, stamped parts, brakes, clutch, exhaust systems and others.

Other prominent supply companies are Adler (carpets and roof lining), Brose (windscreen mechanisms), Denso (air conditioning), Faurecia, (plastics components), Lear (seats), Saint-Gobain Sekurit (passenger car glazing), PMC (metal structures), Pirelli (tyres and wheel fitment), Powercoat (paint) and Tiberina (chassis).

Many of these vendors are world class specialists including Denso, Faurecia, Lear, Pirelli and Saint-Gobain Sekurit.

The supplier park is due for completion within the second half of this year, with pilot production earmarked to begin in August running through to next January.

All told, up to 17 lines of front-line components are planned in what is seen as a massive undertaking for the new Fiat Chrysler Automobile business. Investment in the park could total US$850 million.

Included in the budget for the entire facility in Recife is a new innovation and engineering centre.

By 2016, the plant's annual production output could tip the 130,000 mark, though planned capacity is 200,000 units. Plant capacity is thought to be 15 per cent of FCA's Brazilian production of 840,000 units. The Betim complex remains Fiat's largest facility in the region.

Shareholders approved a transaction on 1 August that paves the way for Fiat Chrysler Automobiles NV to be established under law.