Fiat Chrysler Automobiles NV (FCA) said it will invest $250 million to increase its presence in India with the launch of four new Sport-Utility Vehicles (SUVs) under its Jeep brand over the next 2 years. The FCA said in a statement that the investment would be made locally to build a medium-sized, three-row SUV, assemble Jeep Wrangler and Jeep Cheroki vehicles in the country and launch a new version of the Jeep Compass SUV.
FCA currently holds less than a 1% stake in India's passenger vehicle market. Adding new vehicles to its portfolio is expected to help automakers increase local sourcing of components, achieve a better economy of scale, reduce costs and boost sales. "Our new investment of $250 million will give us an increase in competition in many segments," FCA India Managing Director Partha Dutta said in a statement. "
The investment comes at a time when vehicle manufacturers globally are battling the epidemic, and automakers in India have moved ahead with the domestic market slowing even earlier in 2019. Japan's Honda Motor Company has been forced to shut down one of its two plants in the country, and General Motors stopped production of cars in India for exports after it stopped domestic sales last month in 2017.
India has seen the entry of new automakers, including South Korea's Kia Motors and China's SAIC Motor Corp. in the last few years. The FCA will produce and assemble new SUVs at its car plant in western India, which is owned by domestic automaker Tata Motors. FCA's three-line SUV is expected to take on Ford Motor's Endeavour and Toyota Motor's Fortuner SUV. FCA's total investment in India in the latest round has exceeded $700 million, including $150 million in a new global tech hub.