Toledo Blade...
Chrysler looks at even bigger plans for Toledo
$15M 2nd phase of expansion has been mulled
By Larry P. Vellequette

8/15/11 

As Chrysler employees and metro Toledo celebrated the news Thursday that the automaker plans to add 1,105 jobs to its local work force, new documents released by the City of Toledo indicate that the automaker’s future plans for its Toledo Assembly complex may be grander than first thought. 

In an April letter, Chrysler Group LLC said it might add another 530,000 square feet to the existing 4-million-square-foot complex. 

City economic development officials said Chrysler plans to eventually boost production of the hot-selling Jeep Wrangler and expand production in the plant that now makes the Jeep Liberty and Dodge Nitro SUVs. 

Documents obtained Wednesday show Chrysler wants an $8 million addition to its facility so it can build vehicles for the 2013 model year, presumably including the next generation Liberty. 

But documents from the city indicate that Chrysler was -- or still may be -- considering a $15 million second-phase expansion on its 312-acre site that, combined with the original $8 million, would add three new buildings to the complex. 

The new buildings would need employees, possibly beyond the 1,105 new hourly and salaried employees that the automaker has said it plans to hire. 

A Chrysler spokesman said there would be no comment about a second phase, or whether one was still under consideration. The company is awaiting approval of a state incentive package to be considered by the Ohio Tax Credit Authority on Aug. 29, and the spokesman said Chrysler would have no announcement before then. 

Chrysler did indicate it is considering building a 312,000-square-foot expansion of the body shop and quality lab at its Toledo North plant as part of what is currently under consideration. The new addition would be in the southeast corner of the complex, according to documents given to local officials. It also indicated four areas of Toledo North’s final assembly building and body shop that would receive small additions. 

Further expansion at Toledo Assembly may allow Chrysler to raise production of the Wrangler, a highly popular -- and highly profitable -- vehicle that the automaker and its Italian owner, Fiat SpA, will use to market the Jeep brand worldwide. 

The Wrangler had its highest monthly sales in the United States in July at 14,335 units, and both its domestic and overseas sales continue to grow, stretching the Wrangler plant’s capacity and causing concern at Chrysler that the popular vehicle might be in short supply. 

But even if Chrysler only goes forward with plans for a second shift at Toledo North, local officials and Chrysler workers said the 1,105 new jobs are a much-needed boost to a region still struggling from the recent recession. 

“It’s beautiful,” Brian Mauck said while at Zinger’s Food & Spirits, a bar near the North Toledo plant. “The economy’s growing. Chrysler’s growing.” 

Mr. Mauck works on the assembly line at Jeep and said he expects the expansion will likely happen, with Jeep products selling well overseas. 

Other employees, however, tempered their enthusiasm about the added shift, noting the expansion isn’t official until financial incentives are approved. 

But most were just happy that news and talk swirling about the plant were positive, a far cry from previous years. 

“I’m happy they’re doing this,” said Al John as he left the North Toledo plant Thursday. “We need more jobs. It’s a good thing for everybody.” 

In April, city officials offered Chrysler a number of incentives to expand its Toledo operations, including: 

A 40 percent municipal job-creation tax credit that would return 40 percent of city income tax paid by newly hired employees, or about $289,000 per year for 10 years, as a credit against corporate profits taxes. 

Cash grants of 30 percent of the city income taxes paid by newly hired employees, or about $244,000 per year for 10 years. 

Frozen or reduced city water and sewer rates. 

Roadway improvements totaling $500,000. 

The city also offered tax abatements to real property that would have added about $9.5 million in incentives, but those have since been replaced by other incentives totaling about $600,000. 

“This is important for our collective psyche,” said Toledo’s Deputy Mayor Tom Crothers, adding that Chrysler’s move tells the community and outside world that businesses take Toledo seriously. 

He said it also will bolster the work force and a sense that the city is moving forward. 

“The fact that there were competitors made us sharpen our pencils,” Mr. Crothers said. Chrysler’s investment “is brand new money that we don’t have.” 

Toledo Public Schools’ officials and board members, who must approve any abatement of property taxes, vowed Thursday to support Chrysler’s expansion. 

“I want to congratulate Chrysler for deciding to make this investment in Toledo,” school board President Bob Vasquez said. 

The Toledo school district has been asked for a 15-year, 50 percent tax abatement on the plant’s expansion, worth about $37,000 a year, district officials said. The Washington Local school district, where part of the plant lies, has received a similar request and will vote on it Wednesday, Superintendent Patrick Hickey said. 

Read it at the Toledo Blade