Fiat bets big on SUVs but not on Chrysler

The Fiat Group is planning to pull the plug on the Chrysler brand in Europe but believes that Jeep has a huge future on the continent and beyond as the consumer demand for rugged crossovers and SUVs shows no sign of dimming.

In February, Fiat Chrysler Automobiles sold over 66,000 vehicles in Europe. And while very few (6,000) carried a Chrysler badge, the company saw a 182.4% year-on-year increase in Jeep sales.

Fiat has shown with the retro-styled 500 city car that it knows how to take an in-demand vehicle and stretch its brand and styling values into a whole range of cars, and it has similar plans for Jeep. The marque has a three-model range at the moment but Fiat wants to also offer a mid-sized Jeep-badged crossover to the ranks and, before the end of the decade, a premium SUV that could truly go toe-to-toe with Range Rover.

However, Fiat also has to be careful. As well as owning US marques Chrysler, Dodge, Ram and Jeep, it is also Alfa Romeo, Maserati, Lancia and Ferrari's parent company -- at least until the share offering makes Ferrari (semi) independent again later this year.

Maserati will be launching its first SUV, the Levante, next year and an Alfa Romeo crossover is also in the works. Fiat is clear that every model needs to stand on its own and not detract from other vehicles that it makes.

However, the reorganization and shifting focus means that there will be casualties, as well as new models.

The Chrysler brand -- which consists of the 300C, Ypsilon (based on a Lancia) and Grand Voyager -- are being axed EU wide and the Lancia marque will now be confined to one car alone (the aforementioned Ypsilon) and in one country alone -- its native Italy.

The Ypsilon city car celebrates its 30th anniversary in 2015 and it's sad to think that it's all that's left of Lancia, a company that was once one of the most revolutionary and innovative carmakers on the planet and one that dominated Formula One, track racing and the World Rally Championships in its heyday.

But, according to the latest data, SUVs and crossovers, not sports and luxury cars, is where the demand is strongest. JATO Dynamics figures show that over the past 12 months, crossovers and SUVs accounted for 21% of all cars sold in Europe (that's 2.5 million cars), and growth in the segment is outstripping growth in all other vehicle segments.

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