Group LLC plans to build Auto Group’s Fiat 500 subcompact car in Toluca, Mexico, The Wall Street Journal reports, based on unnamed sources.
Additionally,reportedly is looking at producing a small engine at its Trenton, MI, plant and considering building a compact car in the U.S.
Chrysler officials have declined to comment on the report.
Fiat acquired a 20% stake in Chrysler earlier this year as part of the Detroit auto maker’s exit from bankruptcy and could increase its stake to 35%.
The agreement in parts calls for the Italian auto maker to provide small-vehicle platforms, fuel-efficient engines and other technology. In return, Fiat received billion in loans from the U.S. government, which owns 8% of Chrysler.
Chrysler’s Toluca plant builds the PT Cruiser and Dodge Journey cross/utility vehicle and employs 2,180 workers.
Fiat has said it intends to bring the popular 500 and other Fiat cars, as well as the sporty Alfa Romeo brand, to the U.S.
Fiat announced earlier this month plans for its recently purchased Bertone Carrozzeria SpA to produce niche models, such as sports cars and luxury sedans, to be sold under both the Fiat and Chrysler brands. It also said it would invest some E150 million ($212 million) in the contract-manufacturer's factory over the next three years.