Fiat may build Chrysler and Jeep vehicles in Italy for the U.S. market image

Fiat is considering using its idled plants in Italy to build Chrysler and Jeep vehicles for export, according to a report from Reuters.

After a meeting with Italian Prime Minister Mario Monti, the Italian carmaker said it could use its under-capacity plants in Italy to build cars for export, thus keeping the plants busy and viable.

The meeting took place as reports about Fiat’s intention to shut down at least one plant in Italy intensified. Fiat is complaining about overcapacity and not enough demand, as sales in Italy and the rest of Europe are reaching record lows not seen in the past 40 years.

Marchionne said many Italian factories are working at 50 percent or less of their ideal production capacity. And since there is little chance of a revival of the European market until at least 2015, a solution may be to build cars for export. Unless that is done, the plants will likely need to be closed down.

According to an unnamed source quoted by Reuters, this could result in Chrysler and Jeep models for the U.S. market to be built at the idled Fiat factories, as U.S. plants are running at full capacity. No further details were revealed but it is likely that such a move will be subsidized by the Italian government in financial or other ways to help keep jobs in the country.