Fiat Chrysler Automobiles will reportedly invest almost 1 billion euros ($1.1 billion in current exchange rates) in the development of the production version of the Alfa Romeo Tonale compact SUV concept, as well as the Fiat Panda’s hybrid successor.

AutoNews cites a statement from metal mechanic unions FIM, UILM, FISMIC, UGLM and AQCF, saying that the two new models will be produced at FCA’s Pomigliano factory near Naples in Italy.

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The major investment is just part of FCA’s plan to spend 5 billion euros in Italy up to 2021 in order to launch its first electric and hybrid models and fill capacity in its under-utilized Italian plants.

A spokesman for FCA confirmed the statement, adding that the car maker’s investment for the two new models would be “closer to 1 billion than 500 million euros”. The spokesman said that a “premium compact SUV” is set to be produced at the Pomigliano factory, alongside a hybrid Panda, without confirming it was the production version of the Alfa Romeo Tonale.

Fiat is set to start producing the next Panda hybrid in the first half of 2020, with the Alfa Romeo Tonale to enter production a year later, in 2021.

The Alfa Romeo Tonale concept debuted at the Geneva Motor Show last March, giving us a preview of the brand’s upcoming SUV that will slot underneath the Stelvio in the range. It will also be the brand’s first plug-in hybrid model.

Work on the Pomigliano factory, which current is churning out the current-gen Fiat Panda, has already begun in order to prepare it for the two new models. Earlier this year, FCA said that it will also invest 700 million euros for a new production line in its Mirafiori factory for the new 500 electric hatch, with production set to start in the second quarter of 2020.