Chrysler to invest $266 million to increase 8-speed transmission production

Article by Christian Andrei, on December 12, 2014

Chrysler Group is planning to make a $266-million investment into its Kokomo Transmission complex to expand output of its eight-speed rear-wheel-drive gearbox. Chrysler is producing the eight-speed automatic transmission in Kokomo under license from ZF Friedrichshafen.

In a recent filing with the United States Securities and Exchange Commission, Chrysler said that the transmission will be ultimately fitted in all of its rwd vehicles including the Jeep Wrangler but excludes the Dodge Viper and certain heavy-duty Ram pickups.

The Jeep Wrangler is currently equipped with a five-speed automatic gearbox and is being redesigned for MY2018. The eight-speed gearbox boasts of up to 9-percent better fuel economy than the five-speed and six-speed transmissions they replaced, Chrysler’s SEC filing said. According to Chrysler spokeswoman Jodi Tinson, the $266-million investment in Kokomo is not yet confirmed.

That amount would be in addition to the $1.5 billion that Chrysler has already spent for the site since 2009. The 3.1 million-square-foot complex has a workforce of around 7,600 people. Chrysler said in a written statement that the new investment will give it the flexibility to respond to the market with more fuel-efficient vehicles.

Local press has reported that elected officials in Kokomo, Ind., unanimously green-lighted a request by Chrysler for a 10-year tax abatement for the project. The carmaker said the abatement would retain employment, “subject to market conditions.”

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