Suzuki and Fiat to produce SUVs in Hungary

Production of four-wheel-drive SUVs will be based on Suzuki's subcompact Ignis passenger car, which began production at its Esztergom plant in Hungary last week. The new model will be built at the Hungarian plant from 2005 and will have a 1.5 litre engine. Both companies plan to sell a total of 60,000 units in Europe annually, split 40,000 to Suzuki and 20,000 to Fiat. The cars will be the same mechanically, but will be sold separately under the Suzuki and Fiat brands. By entering into the alliance, Suzuki hopes to cut development costs and increase its foothold on the European subcompact market. Suzuki and Fiat are both part of the General Motors stable, with the of the US States carmaker holding a 20% stake in each.