It will require an investment of $280 million in its local manufacturing joint venture known as Fiat India Automobiles Private Limited which was created in collaboration with Tata Motors Limited. This new investment will be in the manufacturing facility located in Ranjangaon, India where they will start making a new Jeep model in the second quarter of 2017.
According to forecaster IHS Automotive, India is expected to become the third world’s largest market by 2020, behind China and United States so it makes sense that FCA wants a piece of the action by starting assembly of a Jeep model over here. This is a logical move if we take into account that SUVs are still one of the fastest-growing vehicle segments all over the world and it represents approximately one fifth of India’s annual passenger vehicle sales which stand at about 2.6 million cars.
Details about the model that will be produced at Fiat's plant in the western state of Maharashtra are not available at this point, but we know from Jeep’s chief Mike Manley from a previous statement they will start Indian sales this year with the Wrangler and Grand Cherokee.
This decision to commence Jeep production in India is part of a greater plan as Fiat Chrysler CEO Sergio Marchionne aims to double Jeep’s sales by 2018 to two million units and according to Mike Manley it’s important to have local production for major markets.
It will be interesting to see whether this Indian-built Jeep model will be a success as in recent years both PSA Peugeot Citroen and Renault have decided to end their joint ventures or simply withdraw altogether due to poor sales. Speaking of which, Fiat’s deliveries in India have dropped by 13% to 10,380 units so it seems India is proving to be a tough market for Western European countries.