Fiat Chrysler said two high-performance engines that will play an important role in Alfa Romeo's global relaunch will be built at the automaker's plant in Termoli, Italy.
The engines are a range-topping, Ferrari-derived six-cylinder gasoline engine developed specifically for Alfa Romeo and a high output four-cylinder engine family including gasoline and diesel units.
Fiat Chrysler will invest more than 500 million euros to install capacity to build 200,000 engines annually at the plant in central Italy, the company said on Wednesday. The work is set to be completed within six months.
The company gave no further details of the engines.
The four-cylinder 2.0-liter engine will debut in Alfa’s new midsize sedan that will be unveiled in June, supplier sources told Automotive News Europe last year. The sedan will go on sale in 2016. The V-6 twin turbocharged gasoline engine will have an output of up to 480 hp. It has been re-engineered from the 3.0-liter unit that Ferrari builds for the Maserati Quattroporte and Ghibli sedans, the sources said.
The Termoli plant currently builds eight-valve and 16-valve versions of the automaker's FIRE engine family and two transmissions for the Fiat Ducato car-derived van and midsize passenger cars.
Alfa Romeo is a core part of Fiat Chrysler's ambitious five-year 48 billion-euro turnaround plan. The carmaker plans to invest 5 billion euros in Alfa Romeo to boost sales more than fivefold to 400,000 vehicles in 2018 by adding eight new models and ramping up production. Only 74,000 Alfa Romeos were sold in 2013.
Fiat Chrysler CEO Sergio Marchionne has said he will keep production of Alfa Romeos in Italy to fill under-utilized plants, protect jobs and vindicate his belief that "Italians know how to build great cars."
Fiat bought Alfa from state holding company IRI in 1986, but several attempts at reviving the brand have stalled, leaving just three models.
Reuters contributed to this report