* Capacity increase depends on Alfa Romeo, Maserati revamp
* CEO says doesn't need to sell assets to fund business plan
* Says to make announcement on Jeeps in China "within days"
* Shares close up 2.6 pct, hit more than six-year high
(Recasts with production target, adds details, comments, writes
By Agnieszka Flak
TURIN, Italy, March 31 Fiat Chrysler Automobiles
(FCA) will be able to make more than 6 million cars a
year by 2018 as its strategy focused on relaunching the Alfa
Romeo and Maserati marques bears fruit, its chief executive said
Speaking after a shareholders' meeting in Fiat's hometown
Turin in northern Italy, Sergio Marchionne's comments underscore
his upbeat view of the group's prospects following the full
merger with U.S. partner Chrysler and reinforce a long-cherished
Marchionne has always said that a production capacity of at
least 6 million cars a year was critical for an automaker's
survival on the global stage, though the company does not give
out past production figures. It shipped 4.4 million vehicles
last year, a number which was hit by slack demand at home and in
some other European markets.
Fiat - whose shares rose to a more than six-year high during
the session - took full control of Chrysler in January in a
$4.35 billion deal, creating the world's seventh-largest auto
group and making it possible for the two to easily and cheaply
share technology, cash and dealer networks.
"By 2018, Fiat will be capable of making more than six
million vehicles (per year)," Marchionne told journalists.
FCA expects to export Maseratis and Alfa Romeos to override
some of the weak demand in its traditional markets, hit by a
six-year slump in car sales in Europe. A new plan outlining new
models and investments will be presented in early May.
Marchionne said FCA may not need to sell assets to finance
its expansion plan, but could fund it by issuing debt.
"Technically, if I look at the structure today, I'd not sell
assets," he said. "Raising capital with some type of instrument
is still on the table.
"We have a lot of advice from Wall Street people that we
don't have to sell assets or raise capital ... but we can run
this by purely financing on debt." A convertible bond was one of
the options the company has been considering so far.
ON THE ATTACK
Marchionne and Chairman John Elkann told shareholders to
expect plenty of good news as the completion of the tie-up with
Chrysler opens greater global opportunities for the carmaker.
"Today we are equipped to go on the attack against the
giants in our industry," Marchionne said.
He also said the company was still in talks with Russia on a
possible collaboration that could involve FCA setting up a plant
there to produce Jeeps and light commercial vehicles.
"The talks with the Russian Federation and Sberbank
are continuing," he said. "Russia continues to be a
market of strategic relevance."
China remains one of the company's main weak points and
Marchionne said FCA would make an announcement on production of
Jeeps in China "within days". He did not give any details.
The CEO reiterated the group's forecast of a 2014 trading
profit of between 3.6 billion euros ($5 billion) and 4.0 billion
on revenue of around 93 billion. Worldwide group shipments are
expected to rise to between 4.5 and 4.6 million vehicles this
year, up from 4.4 million in 2013, he added.
Marchionne said the growth in shipments will be largely
driven by higher volumes in North America and Asia-Pacific.
The new FCA - formal creation of which is still subject to a
shareholder vote later this year - will have its primary listing
in New York, with a secondary listing in Milan. The holding
group will be registered in the Netherlands and have its tax
domicile in Britain, cementing a politically sensitive shift
away from Italy, Fiat's home for the last 115 years.
Marchionne expects to finalise the merger and the move of
the primary listing this year. Unions and politicians have been
concerned about any potential job cuts but Fiat said the merger
would have no impact on jobs in Italy or elsewhere.
Fiat shares closed up 2.6 percent at 8.45 euros, compared
with a 1 percent rise in Milan's blue-chip index, after
hitting their highest level since late 2007.
($1 = 0.7271 Euros)
(Additional reporting by Stefano Rebaudo; Editing by David