The Chrysler group plans to spend about $US2 billion to overhaul its Jeep assembly facilities in Toledo, Ohio, and launch models that will be added to Jeep's range, a source close to the matter told Reuters on Thursday.

However, company spokesman Dan Bodene declined to comment on details of the plans, which are subject to ratification of a new eight-year labour agreement between Chrysler and the Local 12 branch of the United Auto Workers union, the report added.

The source familiar with the Jeep production plans, confirming reports in Toledo's The Blade newspaper, told the news agency the investment of up to $2.1 billion would pay for existing plant improvement, a new factory and redesigned versions of the Jeep Wrangler and at least two other new vehicles.

The new factory, expected to be ready in 2006, would be located alongside a recently built $750 million facility where Chrysler makes the compact Jeep Liberty SUV, Reuters added.

Citing The Blade, the report said suppliers at the new factory, and not hourly UAW workers, would handle body and paint shop work on the redesigned Wrangler.

The source told Reuters the new labour pact, which is expected to be ratified by the union as early as next Monday, would entail no cuts in the UAW work force, which other reports put at around 4,700.

Reuters noted that the UAW branch in Toledo has negotiated its labour agreements separately from the union's national leadership since Chrysler Corp. acquired AMC and its Jeep brand in 1987.