Fiat Chrysler Substituting Fiat Production, Adding More Jeeps in Italy

Matt Posky
by Matt Posky

During Fiat Chrysler CEO Sergio Marchionne’s final days, he said his company would begin prioritizing Jeep production in Europe. This of course comes at the expense of the Fiat brand, which lost a sizable hunk of the European market after 2009 and appears to be outright failing in the United States.

While the brand gained back some of that lost ground east of the Atlantic over the past two years, Fiat’s Jeep stablemate took off like a rocket after 2013 — effectively tripling its share of the European market. Eager to cater to the ever-changing tastes of consumers, FCA is going to stick with Jeep and make some money. As a byproduct, the company thinks it may be able to revitalize Italy’s manufacturing industry, bolster overall volume, and get some laid-off employees back onto the factory floor.

However, it’s not just Jeep that’s getting special treatment. FCA intends to do the same for Alfa Romeo and Maserati, as their products boast higher margins than anything Fiat builds.

According to Reuters, the automaker’s freshly appointed European chief, Pietro Gorlier, is scheduled to meet with union reps on Thursday to discuss the proposals before presenting them to the media.

From Reuters:

FCA’s Melfi plant in southern Italy, which already produces the Jeep Renegade, is expected to also produce the Jeep Compass, the sources said. The Compass will replace the Fiat Punto, which was discontinued in August.

The Pomigliano factory near Naples is set to keep the Fiat Panda, the most sold vehicle in Italy, the people added, dismissing earlier reports the model could return to FCA’s plant in Poland, where it was made until 2011.

Pomigliano will also get the new Baby Jeep, smaller than the Renegade, which will be another model targeting European clients.

The Fiat brand will ultimately be reduced to a handful of high-volume models — namely the 500 line and still-popular Panda. New vehicles are expected to be relegated to Europe (leaving little hope for the brand’s American resurgence) and electrified. That could still bode well for Fiat’s Italian hopes. Fiat’s Mirafiori plant in Turin has long been the favored choice for the new Fiat 500 EV. However, sources claim nothing is finalized at this point, and the internal combustion variant remains in production in Poland.

Marchionne’s original vision was to see all ailing European plants operating near capacity by the end of 2018. Shortly before his death, he revised FCA’s long-term strategy. Expect the automaker to focus heavily on SUVs and crossovers between now and 2022, with production of Fiat vehicles shifting to lower-wage jurisdictions.

[Image: FCA]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • RSF RSF on Nov 28, 2018

    I like the concept... Build what people want to buy!

    • SPPPP SPPPP on Nov 28, 2018

      I think the truth is somewhere in between "build what people want to buy" and "build what they want people to buy". High-margin vehicles are great, but you can't have every automaker in the world doing only that. It won't allow economy of scale.

  • SPPPP SPPPP on Nov 28, 2018

    I think it will have to be spelled "Gip" now.

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