ROME, Dec. 3 (Xinhua) -- Fiat-Chrysler, the Italian-American automobile production giant created by the merger of former rivals in 2014, announced it would spend 5 billion euros (5.7 billion U.S. dollars) in Italy over the next three years.
The plan, a piece of positive economic news in a country that has had little of it recently, will help update existing Italian auto production plants to produce high-end and high-profit vehicles such as Alfa Romeo and Maserati luxury sports cars, Jeep sport vehicles as well as hybrid and electric cars.
All told, 13 new or redesigned models will emerge from Italian factories by the end of 2021, and all plants -- many currently run well below capacity and at one point even rumored to be candidates for shutdowns -- will reach full employment.
"These are investments that are ready to be implemented and to start as soon as tomorrow morning," Pietro Gorlier, Fiat-Chrysler's European director, said from the company's main headquarter in the northern city of Turin last week.
The developments are welcome news in Italy, which is suffering from slow economic growth, rising interest rates, and increasing political isolation due to controversial stances about the country's role within the European Union (EU).
As a stand-alone company, Fiat, the name is an acronym for the Italian words for the Italian Automobile Factory of Turin, was Italy's most important industrial entity for generations. Founded in 1899, the company helped fuel Italy's post-World War II economic boom. From the 1960s to the 1980s it was the biggest private employer in the country before it started to suffer from international competition.
The company formed an alliance with troubled U.S. carmaker Chrysler in 2009 and five years later Fiat took over its one-time rival to create Fiat-Chrysler Automobiles, sparking a turnaround under the stewardship of chief executive Sergio Marchionne. The new company is now the world's eighth largest carmaker, with factories around the world including in Brazil, Canada, China, India, Mexico and Poland.
"Few people thought a combination of two struggling automobile companies from two different cultures would succeed, but Marchionne made it work," Marco Avila, an industrial sector analyst with ABS Securities, told Xinhua.
Marchionne died earlier this year, casting some doubt on the company's ability to continue on its growth path. The announcement of the new investments are the first major European move for the company since Mike Manley, the former head of the company's Jeep division, was named Fiat-Chrysler's chief executive in July.
The plan is designed to help the company gain ground in Europe, where its market share has slipped from 9 percent to 6 percent in recent years. It could also help boost profits in Europe for a company that saw 97 percent of its profits come from North America in the most recent reporting period, and it comes as General Motors, the biggest carmaker in the U.S., announced it would lay off 14,000 workers in the United States.
"We applaud Fiat-Chrysler's strong commitment during a time when the automotive world was shaken by the news of General Motors' job cuts and challenges coming from the shift to hybrid and electric cars," Roberto Di Maulo, head of the FISMIC trade union, said in an interview.
Investors seemed to be pleased as well: Fiat-Chrysler's shares on the Italian Stock Exchange in Milan have gained nearly 2 percent since the investment plan was announced.