Chrysler to Expand 8-Speed Gearbox Output

Fiat Chrysler Automobiles NV is expected to spend $266 million to hike capacity to build 8-speed automatic transmissions for rear-drive vehicles at its plant in Kokomo, Ind., according to media reports.

Chrysler has not confirmed the amount of the investment or how much capacity it will gain. The company notes it has already spent $1.5 billion on the 3.1 million-sq-ft Kokomo complex over the past five years.

Last night Kokomo approved 10 years of tax abatements to support the expansion. Chrysler has said it eventually will use the 8-speed unit, which it makes under license from ZF Friedrichshafen AG, in almost all its rear-drive vehicles. Exceptions are the Dodge Viper sports car and some of its most powerful Ram pickup trucks.

Chrysler says eight forward gears makes the ZF transmission as much as 9% more fuel efficiency than 5- or 6-speed automatics.