Fiat will spend $5.7 billion to revamp Italy plants

November 29, 2018 13:45 CET
UPDATED: Nov. 29 14:45 – adds detail

MILAN — Fiat Chrysler Automobiles will spend 5 billion euros ($5.7 billion) through 2021 on the automaker’s factories in Italy, stepping up the pace on making more in-demand SUVs and electric cars, people familiar with the plans said.

The increased outlay will finance Fiat’s plan to build a compact Alfa Romeo SUV at the Pomigliano plant, hometown of Italy Deputy Premier Luigi Di Maio, and a battery-powered Fiat 500 in Turin’s Mirafiori factory. These are two new products FCA announced in a statement following a meeting with Unions on Thursday.

The automaker’s Italian sites for years have struggled to run at full capacity, raising costs.

A third pillar of FCA’s plan adds the compact Jeep Compass SUV to be made in Melfi, Central Italy. Deliveries for the brand surged 61 percent in the year through October in Europe, contrasting with a decline of 2 percent for the group.

Fiat will keep all Italian factories open, the company said.

The announcement of 13 new and revamped products to be built at the automaker’s plants in Italy come as the company grapples with an increasingly lopsided business that saw North America account for some 97 percent of profit during the third quarter.

Bloomberg contributed to this report

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