DETROIT - Beginning in 2005, the Chrysler group will build about 600,000 four-cylinder engines annually with Hyundai Motor Co. and Mitsubishi Motors Corp. at a new plant in Michigan.
Last week, Chrysler group CEO Dieter Zetsche said the three automakers will build the plant in Dundee, Mich., as part of a joint venture created last May. He would not disclose the plant investment.
The joint venture also will begin building four-cylinder engines in Japan and South Korea in 2004, Zetsche says.
At full production, the three plants will manufacture an estimated 1.5 million units annually. The Chrysler group will receive 40 percent of the total output; Hyundai and Mitsubishi will receive 30 percent each, he says.
The Japanese engine plant will supply Mitsubishi; the South Korean plant will supply Hyundai. The Chrysler group will receive the majority of U.S. output. But the other two automakers could get some of the U.S. build, depending on demand.
The joint venture, called the Global Engine Alliance LLC, has not announced engine details or which vehicles will use the powerplants.
Anticipated growth in vehicle demand is the main drive for the new U.S. plant, Zetsche says. Chrysler has not said which engines might be phased out.
The three automakers hold equal shares in the Global Engine Alliance. The Michigan plant will receive state and local financial incentives totaling $115 million, according to Michigan officials.
The plant, which is expected to be represented by the UAW, will operate under contemporary labor agreements, Zetsche says.
UAW Vice President Nate Gooden says it is premature to discuss wages and benefits or flexible work rules at the plant.
DaimlerChrysler owns 37.3 percent of Mitsubishi and manages the Japanese automaker, and it has a 10.5 percent stake in Hyundai.