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Italian government offering Lamborghini $111 million to build an SUV

Lamborghini’s leadership really wants to build a new SUV, and there are probably scores of Russian oligarchs waiting to buy it. But there’s another group that appears eager for Lambo to return to the 4×4 market.

Eager to create new jobs, the Italian government plans to offer up to 100 million euros (about $111 million) in tax breaks and incentives for a new facility dedicated to SUV production, Bloomberg reports. The new facility would be located near Lamborghini’s headquarters in Sant’Agata Bolognese, and employ about 300 people.

The Italian economy has been in a recession since 2011, and the government views stable manufacturing jobs as key to getting it back on track.

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The SUV, which is expected to be based on the Urus concept from the 2012 Geneva Motor Show, would share the MLB platform with other Volkswagen Group products. So while it would be assembled in Italy, most of the components would come from other places.

Bodies would be made at the same plant as related VW Group SUVs, including the Volkswagen Touareg, Audi Q7, and Porsche Cayenne. They would be shipped to Italy for final assembly.

First, though, the VW Group brass needs to give final approval. While Lamborghini itself is gung-ho about the project, there is some concern that the Urus would cannibalize sales from other brands.

And while the LM002 “Rambo Lambo” serves as a precedent, some question whether customers will really buy a Lamborghini SUV, or whether the booming SUV market will remain intact by the time it reaches production.

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Lamborghini has said it plans to launch the SUV in 2017, and will only share parts with other VW Group models when absolutely necessary to preserve its caché. However, speculation regarding its powertrain includes some very un-Lambo like options, such as smaller turbocharged engines and a hybrid system.

While officials continue to waffle, the case for a Lamborghini SUV is growing stronger. Fellow VW property Bentley and Rolls-Royce are set to launch SUVs that — if they’re successful — could open the door for a new range of ultra-expensive models.