Fiat Chrysler to invest $250M in India to build Jeep models

NEW DELHI -- Fiat Chrysler Automobiles will invest $250 million to grow its presence in India with the launch of four new Jeep models over the next two years.

The investment will be made to locally manufacture a midsize, three-row SUV, assemble the Jeep Wrangler and Jeep Cherokee vehicles in the country and launch a new version of the Jeep Compass SUV, FCA said.

FCA currently has less than a 1 percent share of India's car market. Adding new vehicles to its portfolio is expected to help the automaker increase local sourcing of components, achieve better economies of scale, reduce costs and boost sales.

"Our new investment of $250 million will give us a competitive edge in multiple segments," Partha Datta, managing director for FCA India said. The automaker is determined to increase locally made components in its vehicles, he said.

FCA will produce and assemble the new SUVs at its car plant in western India, which it jointly owns with domestic automaker Tata Motors.

FCA's three-row SUV is expected to compete with Ford's Endeavour and Toyota's Fortuner SUVs.

The investment comes at a time when automakers globally have been battered by the coronavirus pandemic, and companies in India have been further stung with the domestic market slowing down even ahead of the crisis in 2019.

Honda has been forced to shutter one of its two plants in the country, and General Motors last month stopped producing cars in India for export after ceasing domestic sales in 2017.

But India has also seen the entry of new automakers over the last couple of years, including Kia and China's SAIC Motor.

The new investment takes FCA's total spending in India to over $700 million, including $150 million invested in a new global tech center.

On Monday, FCA and PSA Group shareholders approved a $52 billion merger between the two automakers to create a new company called Stellantis.