Dundee plant called key in Chrysler-Fiat integration

1/26/2010

MILAN, Italy - Sergio Marchionne, Fiat SpA's chief executive officer, said yesterday that a new Chrysler plant in Dundee, Mich., that will build Fiat engines represents "a huge step forward" for the integration of Chrysler Group LLC into Fiat.

He said during an investors conference call that the investment in the Global Engineering Man-

ufacturing Alliance plant about 20 miles north of Toledo would bring Fiat's 1.4-liter, four-cylinder engine technology to the United States.

That, in turn, would mean that Fiat can bring those engines into Brazil without duties. Fiat has a large auto business in Brazil.

Mr. Marchionne is steering the turnaround of Chrysler; he became the CEO of the U.S. automaker after Fiat took a controlling share in Chrysler in June.

Chrysler is investing $179 million in the Monroe County factory, which is expected to begin making the engines in the fourth quarter of next year.

The engine will power the Fiat 500 minicar and will eventually replace engines in other Chrysler vehicles.

Mr. Marchionne told the conference call that the Chrysler investment is not big, but "it is a huge step forward in terms of the integration of Chrysler into Fiat."