Italy-made Jeep true test of Fiat-Chrysler's global ambitions

Tue Mar 4, 2014 6:03pm EST
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By Agnieszka Flak

GENEVA (Reuters) - The Jeep Renegade, which debuted at the Geneva auto show on Tuesday, will be the first true test of the recent marriage between Italian carmaker Fiat and its U.S. unit Chrysler, meant to allow both to share technology, cash and dealer networks.

Fiat Chrysler Automobiles' FIA.MI new small Jeep should help the carmaker reach an ambitious sales target of 1 million vehicles for the brand this year and will test the world's seventh-largest auto group's ability to compete globally.

Through the alliance, brands like Jeep hope to gain a global manufacturing footprint in Fiat's home turf in Europe and in fast-growing markets such as Brazil, which has long been one of Fiat's strongholds.

"The investment that Fiat has already made, now gives the opportunity to Jeep to expand its manufacturing footprint at lightning speed," Mike Manley, head of the Jeep brand, said at the launch of the Renegade.

Even though analysts believe Jeep is the only truly global brand in FCA's portfolio, they are cautious about the 1 million target, a 37 percent jump from 2013.

"Even though sales in Europe will grow, it won't be easy to make huge volumes with Jeeps in the region because the market is very different from the U.S. one," said Andrea Giuricin, head of TRA Consulting. "Asia is still a big blind spot for Fiat, and they need to rapidly grow their market share there to be able to maximize on the potential of the Jeep brand."

The brand traces its roots to the iconic World War Two military vehicle and has had multiple owners over the past seven decades.

While the Wrangler and Grand Cherokee models are the best-selling Jeeps, it is through models like the Renegade that FCA hopes to expand the brand outside North America.   Continued...

A logo of Fiat is seen at the Fiat plant in Pomigliano D'Arco, near Naples, in this December 14, 2011 file photo. REUTERS/Alessandro Bianchi