Fiat 500 engine starts production in the US next month

Chrysler announced it will begin manufacturing the engine used in the upcoming Fiat 500 early in November. The engine is a 1.4 liter 4 cylinder equipped with Fiat's innovative MultiAir valve system.

MultiAir is Fiat's revolutionary way of increasing power and torque while reducing fuel consumption and emissions. You can read all about MultiAir here.

The engine, which will be manufactured at Chrysler's Dundee, Michigan engine plant (GEMA), will be shipped to Mexico and installed into the 500, currently scheduled to begin production on December 13.

GEMA, which stands for Global Engine Manufacturing Alliance LLC, was a manufacturing arm of Global Engine Alliance LLC. The alliance was a joint venture of Chrysler, Mitsubishi Motors, and Hyundai Motor Company for developing a line of shared engines. On August 31, 2009, Chrysler bought out the two partners and the engine facility is now a wholly-owned subsidiary of Chrysler Group LLC.



This is significant because it was the stipulation in the original Chrysler/Fiat alliance that in order to increase its stake in Chrysler, Fiat would have to produce this engine here in the USA.

Below is an excerpt of the official Fiat/Chrysler agreement:

"...Fiat will have right to receive up to an additional 15% equity interest (by vote and value) on a fully diluted basis. This stake can be obtained in three tranches of 5% each subject to the achievement of predetermined targets, in particular, achievement of regulatory approvals to produce the FIRE family of engines in the USA; achievement of sales of Chrysler vehicles outside NAFTA, and achievement of regulatory approval to produce a Chrysler model based on Fiat technology. Upon obtainment of such additional 15% interest, Fiat will also have the right to appoint another director of Chrysler..."

Fiat currently owns a 20% stake in Chrysler. Its ownership level will rise to 35% once it meets 3 requirements; build the 500 engine here in the US, sell Chrysler products outside of NAFTA and produce a Chrysler automobile using the award winning C-Evo chassis

Currently Fiat owns 20% of Chrysler and oversees day to day operations at the company. Producing the 500's engine here will up the ownership level to 25%.

You can read more on the merger here. This link takes you to the first post on the merger back in March, 2009. Click newer posts to page forward to see the progression of news.

With thanks to Chrysler Media