Fiat Chrysler extends Chrysler 200 plant shutdown as US sedan sales slide
FCA will keep its Sterling Heights Assembly Plant idle for an extra three weeks, citing weak demand for the Chrysler 200 and a shrinking US sedan market.
Fiat Chrysler Automobiles (FCA) has extended the shutdown of its Sterling Heights Assembly Plant in Michigan, keeping production of the Chrysler 200 sedan on hold for an additional three weeks. The plant, which was originally scheduled to resume operations in mid-March 2016, will now remain idle until at least 4 April, according to FCA.
The decision follows continued sluggish demand for the Chrysler 200 and a broader decline in US consumer interest in compact and midsize saloons. US sales of the Chrysler 200 fell by 58 percent year-on-year in February 2016, with just 6,600 units sold. FCA had already idled the plant from 1 February, citing slow sales as the primary reason.
Shift in FCA’s US strategy
FCA’s move reflects a wider industry trend as American buyers continue to favour SUVs and pickups over traditional saloons. Chief Executive Sergio Marchionne had already indicated in January that the company would wind down both the Chrysler 200 and the Dodge Dart, focusing instead on the Jeep and Ram brands, which have seen stronger demand and higher margins.
FCA invested more than $1 billion in the Sterling Heights facility to support the launch of the second-generation Chrysler 200 in 2014. Despite this, the model struggled to gain traction in a segment under pressure from shifting consumer preferences and low fuel prices. The Dart, which launched in 2012, also failed to meet expectations despite a $600 million investment.
Future of the Sterling Heights plant and FCA’s sedan models
Marchionne has previously said that the Chrysler 200 and Dart could continue if FCA found a partner to share development and production costs, but no such deal has materialised. The extended shutdown leaves the future of the Sterling Heights plant uncertain, with FCA expected to repurpose the facility for higher-demand models in the future.
For now, FCA remains focused on expanding its SUV and pickup offerings, a strategy that has already seen the company invest in Jeep production and plan new models for North America. The shift away from saloons like the Chrysler 200 marks a clear response to changing US market dynamics and consumer habits.
