Although senior executives at Lamborghini are confident the green light will be given for production of a new SUV based on 2012’s well-received Urus concept, there’s still a chance fear of the model cannibalizing sales of other Volkswagen Group brands, or perhaps damaging the performance car image of Lamborghini, may cause the project to be canned. However, faced with an unemployment rate of around 12.5 percent, the Italian government understandably wants to see Lamborghini go through with the project and according to reports may offer some generous incentives to persuade the higher ups at VW.

Bloomberg, citing a source familiar with the matter, is reporting that the Italian government is prepared to offer as much as 100 million euros (approximately $111 million) in tax breaks and other incentives towards a new facility at Lamborghini’s headquarters in Sant'Agata Bolognese to start building the SUV. The project is believed to require around 300 staff directly and numerous others in support roles.

MUST SEE: Bugatti Veyron Successor To Do 0-60 MPH In 2.0 Seconds: Report

Lamborghini is hoping to receive approval for the SUV in June but the timing and final outcome of the talks are difficult to predict, the source said. Complicating the matter is ongoing negotiations with unions about more flexible working hours.

Should approval be given, the new Lamborghini will ride on the SUV version of the MLB Evo platform, currently found in the latest Audi Q7 and destined to underpin Bentley’s Bentayga as well as next-generation versions of the Porsche Cayenne and VW Touareg. The basic body would be built at the same plant in Slovakia where bodies for other VW Group SUVs are sourced. These would then be shipped to Lamborghini in Italy.

To extract the performance one would expect of a Lamborghini from this platform, engineers are expected to use lighter carbon fiber in place of some of the steel and aluminum sections. Key rivals would include Aston Martin’s planned SUV based on the DBX concept as well as high-end versions of the Maserati Levante and Porsche Cayenne.

_______________________________________

Follow Motor Authority on Facebook, Twitter, and Google+.