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Chrysler repeats not moving Jeep work to China from U.S.

By Bernie Woodall

DETROIT (Reuters) - Chrysler Group LLC Chief Executive Sergio Marchionne reaffirmed on Tuesday that the company is not moving Jeep vehicle production out of the United States to China after it became an issue in the U.S. presidential campaign.

Chrysler in an October 25 blog post had already rejected a statement made that day to a crowd in Ohio by Republican presidential candidate Mitt Romney, that Chrysler was thinking of moving all Jeep production from Ohio to China.

Marchionne told employees by email on Tuesday, "I feel obliged to unambiguously restate our position: Jeep production will not be moved from the United States to China."

Romney, speaking last week to a crowd in Defiance, Ohio, said that he had read a news article that said Chrysler's Jeep brand is considering moving "all production to China."

Later, the Romney campaign aired an advertisement that did not repeat the move of production from Ohio but said that Chrysler is considering making Jeeps in China, which Chrysler has said.

U.S. President Barack Obama's campaign, in its own ad, said Romney was making a "false claim" and noted that Chrysler had challenged Romney's statement.

Ohio is seen by many political pollsters one of several key "swing" states in next Tuesday's presidential election.

Chrysler has been managed by Fiat SpA since it emerged from its 2009 bankruptcy, when the Italian company took 20-percent ownership. Marchionne is chief executive of both Chrysler and Fiat.

Fiat has since increased its ownership to 58.5 percent after achieving several goals, including building a fuel-efficient compact car made in the United States and increasing Chrysler sales outside its North American base.

Romney's ad and his comments in Defiance state that Chrysler has been taken over by an Italian company. Chrysler is based in Auburn Hills, Michigan, outside Detroit. Defiance is about an hour's drive to the a main Jeep plant in Toledo, Ohio.

Chrysler as early as June 2011 had said it was considering adding Jeep production in China.

"We are working to establish a global enterprise and previously announced our intent to return Jeep production to China, the world's largest auto market, in order to satisfy local market demand, which would not otherwise be accessible," said Marchionne in the email on Tuesday.

And he also reaffirmed previous Chrysler announcements about increasing its Jeep production at plants in Ohio, Illinois and Detroit.

"We will invest more than $1.7 billion to develop and produce the next-generation Jeep SUV, the successor of the Jeep Liberty -- including $500 million directly to tool and expand our Toledo Assembly Complex and will be adding about 1,100 jobs on a second shift by 2013," his email to employees said.

Marchionne said that Chrysler, including Jeep, has added 11,200 jobs in the United States since 2009.

"Jeep assembly lines will remain in operation in the United States and will constitute the backbone of the brand," said Marchionne in the email. "It is inaccurate to suggest anything different."

(Reporting By Bernie Woodall; Editing by Tim Dobbyn)

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