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DaimlerChrysler consolidates NAFTA heavy-truck operations

DaimlerChrysler consolidates NAFTA heavy-truck operations

DaimlerChrysler invests $275 million to consolidate its heavy truck operations in Redmond

Redford, MI—As part of a $275-million renovation of the Detroit Diesel Corp. (DDC) manufacturing facility in Redford, MI, Freightliner LLC will move the headquarters for its Sterling Truck Corp. and Western Star Trucks business units from their current Willoughby, OH location to the upgraded campus this spring.

The expanded Redford facility will also house manufacturing of the all-new heavy-duty diesel engine line slated for launch in ’07. That engine is currently under development by Detroit Diesel and its parent operation, DaimlerChrysler’s (DC) Commercial Vehicles Division, also the parent of Freightliner LLC.

Redford will be the first facility to build the new engine and will do so fro North American use. By 2010, the engine will be manufactured globally for use in all DC markets.

For an extended transition period, the new engine will be sold in tandem with the Detroit Diesel Series 60 engine. In the NAFTA market, the new engine will be installed in heavy-duty vehicles produced by business units of Freightliner, said Rainer Schmueckle, president & CEO of Freightliner LLC.

Additional Redford plans call for the installation of a new assembly line for the medium-duty MBE 900 diesel truck engine by 2007 and expansion of manufacturing operations for Axle Alliance Co. (AAC), the business unit that supplies Freightliner with proprietary axles.

Manufacturing activities for the recently acquired particulate filter maker Purem may also be moved to the Redford facility.

With this wide variety of DC’s operations— spanning engine manufacturing, sales and marketing, axle and gear set assembly, and possibly filter production— being centralized at one location, the renovation is being called a “mall concept.”

“With the new investment in the DDC Redford complex—including the strategic location of new heavy-duty engine production, the addition of MBE 900 assembly and the advent of AAC—the Redford facility is becoming the group’s commercial vehicle component manufacturing center,” said Schmueckle. “It is a place where leading commercial vehicle components will be designed, developed, tested and produced.

“This…signifies the shared commitment of DDC and the Freightliner group to continuing leadership in all aspects of North American commercial truck manufacturing, including vehicles, components, technology and people,” Schmueckle continued. “We are assembling significant future capability to design and manufacture a variety of key components for North American commercial vehicles here at Redford.”

Manufacturing operations for Sterling Trucks will remain at St. Thomas, Ontario while Western Star Trucks will continue to be produced in Portland, OR.

State and local governments contributed $60 million in tax abatements over 12 years to support the Redford renovation.

DC made the Redford decision after negotiating a new contract with the UAW, which it said benefits workers by consolidating several DC operating units into this facility.

“The UAW is extremely proud of its role in meeting the challenges of maintaining existing work and drawing new work for its membership in Redford,” stated UAW regional director Jimmy Settles.

TAGS: Operations
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