Fiat Chrysler Substituting Fiat Production, Adding More Jeeps in Italy

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]