Fiat will build a new compact Jeep model in Italy.

Fiat, the corporate partner of Chrysler, has announced plans to build a new compact Jeep SUV model at its production facility in Melfi, Italy. The plan will require a $1.3 billion investment from the Italian automaker.

After months of speculation, Fiat CEO Sergio Marchionne confirmed on Thursday plans to build a new Jeep model in Italy for global export. The new Jeep SUV, internally known as the B-SUV, will be sold in Europe, North America and Asia.

The new Jeep model will ride on Fiat-Chrysler's Small Wide platform, which made its debut under the 500L multi-purpose vehicle. No further details about the vehicle were given, but the new compact Jeep is scheduled to begin production in early 2014.

In addition to Jeep's B-SUV, the Melfi plant will also produce Fiat's upcoming 500X crossover. Part of Fiat's plan to grow the 500 brand, the 500X will also be export to global markets, including North America. The 500X, which was previewed at an event earlier his year, is slated to begin production sometime during the second half of 2014.

Fiat is hopeful that the plan to build both vehicles in Italy will help the company return to a break-even point by mid-decade.