Just recently, Fiat S.p.A. has announced its approval of the $1.78 billion budget that will be used to ready the factory where the very first SUV will be born in the 101 years history of Alfa. This will also be where a new Jeep model unit will be made, in replacement of the former Patriot / Compass models.

It is speculated that the production output will start showing by the latter part of year 2012. This was confirmed by Sergio Marchionne, the CEO of the joint Fiat-Chrysler team.

According to the partnership’s spokesperson, the new Alfa SUV model will be going head to head with Mercedes-Benz GLK, Audi Q5, and the BMW X3. Marchionne also adds that the Mirafiori, Turin plant is the sole factory where the new Jeep model will be produced.

Out of the initial 280,000 units to me made in the Turin plant will be sold in the European market while the other half will be sold in North America. The new Alfa model units carry a big weight since it’s part of the Fiat’s re-launch in North America that is scheduled in early 2013.

An estimated 15,000 Jeep units are expected to be made in a year while Alfa units are expected to be somewhere around 100,000 to 130,000.

A bright future though is seen on the 2011 Grand Cherokee of the Jeep line up. This vehicle was developed with their former partner, Daimler, and shares a lot of characteristics with the next generation of ML Class SUV from Mercedes Benz.

The executives from Fiat are contemplating on using the Jeep platform to develop a premium SUV under the Alfa Romeo badge. The vehicle is expected to compete with the likes of Audi Q7, Touareg from Volkswagen, and the BMW X5 in their market in North America.

They are looking at European sales performance of the Grand Cherokee and it is quite impressive. Fiat is planning to duplicate this success in the North American market with the new SUV from Alfa Romeo.

Experts are expecting that the SUV donning the Alfa Romeo colors will not have the off road capabilities of the Grand Cherokee. It may also not be equipped with the HEMI V8 engine but have the Pentastar V6 or a diesel variant.

The SUV from Alfa Romeo is expected to give the brand some flesh in the US market to add to the very limited 8C Competizione it will deliver to the consumers.