Fiat's future Jeep and Alfa Romeo SUV models may be produced in the U.S. after all, if a report from Automotive News proves accurate. The Italian automaker announced last November that a pair of small Jeep- and Alfa-branded SUVs would be produced at its factory in Turin, Italy, after the company invested 1 billion euros ($1.44 billion) in retooling the plant for that task. If production is moved to the U.S., workers at Fiat's oldest assembly facility could be left with building a small city car instead.

Citing an unnamed source close to the matter, Automotive News says a small car will be built at Fiat's Mirafori plant in Turin, while production of the company's future SUVs, many of which are destined for U.S. consumption, could be moved stateside. This has been a continuing dilemma for the Italian auto giant, which last year refuted claims of moving production of 350,000 Fiat vehicles to the U.S. Fiat's main concern is the rising strength of the euro against the dollar, which makes building vehicles in its home country a less competitive option - particularly so with U.S.-bound products.

Last year, when Fiat announced its investment in the Mirafori plant, the euro was strong against the dollar. Since then, it has gained about 9 percent on the U.S. currency, making the prospect of paying Italian workers to build vehicles for the U.S. market even less attractive. Fiat's market share in Europe, its current largest market, has been shrinking over the past few years, dropping to 7.2 percent from 8.1 percent a year prior. The automaker is aiming to recover lost ground with the help of rebranded Chrysler models like the Fiat Freemont, a rebadged version of the U.S.-market Dodge Journey. Selling an American-built vehicle in Europe would boost profits while also potentially increasing Fiat's market share.

A final decision to move production of Fiat's SUVs to the U.S. has not been made, according to Automotive News' source. However, Fiat CEO Sergio Marchionne told Piedmont Region President Roberto Cota, who oversees the Turin facility, that production plans for the Mirafori plant may change.

"Fiat is evaluating which model it will build at Mirafori," Cota told Automotive News. Marchionne may discuss production plans when he hosts the first meeting of Fiat and Chrysler's joint management team tomorrow.

Source: Automotive News (Subscription required)