How smart standards create jobs: Shuttered Indiana plant gets new life as Chrysler moves to boost fuel economy

During my years working in communications at the United Auto Workers, I started each workday looking at news of the U.S. auto industry. Much of the time, it was pretty grim reading: lost market share, lost jobs, closed plants.

It’s a lot more fun to read the auto pages these days. A key factor: The push to advance fuel economy is driving a burst of new investment in R&D, engineering and manufacturing, as companies re-tool to meet higher standards.

Case in point: Detroit Free Press auto writer Brent Snavely reports on a remarkable turnaround at Chrysler’s Kokomo Transmission Plant in Indiana.

In 2009, the 643,000 square-foot facility, dormant for several years was scheduled for closure – until Chrysler powertrain chief Brian Harlow had a chat with CEO Sergio Marchionne. His pitch: the company needs to make more of its own transmissions. The reason:

Chrysler, like all automakers, is racing to meet the government’s Corporate Average Fuel Economy target of 35.5 m.p.g. by 2016.

“There is a definite road map that takes us there in our volumes,” Harlow said. “This is a huge part of that strategy to get us to CAFE standards and beyond.”

Chrysler is manufacturing eight- and nine-speed transmissions in Kokomo, developed by German component maker ZF Group. With more gears, more efficient shifting, and less friction, the new models deliver better performance and better fuel economy than the six-speed transmissions they replace.

They are also delivering jobs in Indiana. Instead of a plant closure, the Free Press reports, Chrysler is investing $1.4 billion in four Kokomo-area plants, which will “provide job security for 4,150 workers.”

My definition of a nice way to start the day: Reading about middle-class manufacturing jobs, staying in the Midwest.

Roger Kerson is a Michigan-based media consultant for labor unions and environmental organizations. He was formerly the director of public relations at the United Auto Workers.


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