Chrysler May Build Second Fiat Model in Mexican Plant, CEO Marchionne Says

Chrysler Group LLC Chief Executive Officer Sergio Marchionne said the automaker is looking at building a second Fiat SpA (F) model at the U.S. company’s factory in Mexico.

Marchionne, speaking to reporters today in Mexico City as part of a celebration of the start of Fiat 500 production at Chrysler’s Toluca plant, didn’t say what the second model would be or whether it will be made at that factory. Toluca will also make the electric version of the 500, and some of the small cars assembled there will be exported to China, Marchionne said.

“We need to decide what we’re going to do with that plant,” he said. “The likelihood is that we will bring in an architecture that is more versatile and will give us an opportunity to produce more than one top hat” or body style. Nothing has been decided, he said.

Executives with the Auburn Hills, Michigan-based automaker also discussed selling a second Fiat model in North America, investing in Mexico to make commercial trucks, and the introduction of the Alfa Romeo brand to Mexico with three or four models.

Chrysler is exploring using its Saltillo, Mexico, plant to build commercial vehicles, Marchionne said. Chrysler is talking to local government officials about it, he said. While it’s too early to say what kind of investment would be needed to bring commercial vehicles to Mexico, Marchionne said it would be at least as much as was spent on the 500.

Alfa Romeo

Three Alfa Romeo models will be sold in Mexico, said Joseph ChamaSrour, the president of Chrysler de Mexico SA. He didn’t say where they would be made.

Alfa Romeo vehicles will go on sale in Mexico in June or July, ChamaSrour said, starting with the Mito, Giulietta and 159 “right out of the chute.” Marchionne added that the 4C coupe, shown as a concept car at the Geneva auto show last week, would also be sold in Mexico at some point.

Chrysler’s sales in Mexico rose 11 percent in February, trailing the company’s 12 percent global growth and 13 percent increase in the U.S., the automaker said in an e-mail last week.

Fiat is planning to introduce a four-door model in North America in 2013, said Laura Soave, head of the brand for Chrysler Group.

Chrysler won’t increase incentives in the U.S., Marchionne said. The automaker reduced marketing promotions in February by 14 percent to $3,052 per vehicle, according to researcher Autodata Corp. of Woodcliff Lake, New Jersey. The industry average last month in the U.S. was $2,578, Autodata said.

Chrysler will probably show a hybrid version of its namesake brand’s 300 sedan at next January’s Detroit auto show, Marchionne said. The company revealed the new 300 body design at this year’s show.

To contact the reporters on this story: Tim Higgins in Mexico City at thiggins21@bloomberg.net;

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.