TURIN, Italy -- Fiat S.p.A. plans to move all production of the next-generation 500 subcompact to Tychy, Poland, three sources said. The redesigned car is due in 2015.
The consolidation in Tychy, which has produced 500s for more than five years, will end 500 production at Chrysler Group's plant in Toluca, Mexico. Toluca supplies the 500 to North and South America and ships a few thousand units a year to China.
Building the next 500 in Fiat's Tychy plant will increase capacity utilization there. It also will free capacity in Toluca for Chrysler to build core products for North America, said Massimo Vecchio, a financial analyst at Mediobanca Securities in Milan.
The Tychy plant is suffering from declining industry sales in Europe. Also, in early 2011 Fiat decided to move production of the third-generation Fiat Panda from Poland to Italy to protect jobs in its home country.
At the Detroit auto show last month, Fiat-Chrysler CEO Sergio Marchionne said that Chrysler's North American plants are nearing full capacity. He confirmed that Chrysler plans to ship about 2.8 million units globally in 2014 from 2.4 million last year.
Marchionne added that, before opening plants in the North American Free Trade Agreement region, he will try to fully use Fiat's European plants to satisfy Fiat-Chrysler global demand.
The Toluca plant assembles the Fiat 500 and the Dodge Journey crossover. The Toluca-built Journey is also sold as the Fiat Freemont in Europe, South America and China.
Chrysler declined to comment on future product allocations at its plants.