Fiat the Italian carmaker which controls Chrysler Group LLC, may shift planned production of Jeep and Alfa Romeo brand SUVs from its oldest plant in Turin to North America and build a small city car at the factory instead. Hit the jump to read the rest of the story.
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Fiat may assemble a yet-to-be built small car at the Mirafiori plant after the strengthening euro against the dollar made the possibility of building SUVs mainly destined for the U.S. a less competitive option in Europe, said the person, who declined to be identified before an official announcement.
A final decision hasn’t been made, the person added.
Fiat last November announced a 1 billion euro ($1.44 billion) investment to make as many as 280,000 Jeep and Alfa Romeo SUVs at the Mirafiori plant starting in the fourth quarter of 2012.
The euro has gained about 9 percent against the dollar since then, raising the cost of building vehicles in Europe bound for the U.S. market.
“From a product-mix point of view, it makes a lot of sense,” AT Kearney analyst Marco Santino said by phone. “The U.S. would keep know-how of SUV building, it would help the launch of Alfa Romeo in North America and it would be a more competitive product due to lower costs of production.”
The automaker may discuss the small car in Turin tomorrow when CEO Sergio Marchionne hosts the first meeting of Fiat and Chrysler’s single management team, the person said. A Fiat spokesman, who confirmed the meeting, declined to comment on the production plan.
