Chrysler and Fiat Reported to be in Partnership Talks

Once again, the media is reporting that Chrysler LLC and the Fiat Group is in talks to form a strategic partnership that could give the American automaker access to platforms, engines and transmissions to Fiat's mini, small and lower /upper medium models. The Fiat Group on its behalf would benefit from Chrysler LLC's North American manufacturing plants and most importantly, the firm's distribution network as the Italian automaker has been trying to find a way to enter the U.S. market.

Citing -but not naming- people familiar with the matter, Reuters reported that the strategic partnership between the two automakers could possibly lead to the Fiat Group taking a stake in the ailing U.S. carmaker. For the record, neither Fiat nor Chrysler LLC where available to comment on the report.

Even before its divorce with Mercedes-Benz's parent company, Daimler - which still owns 19% of Chrysler LLC, the American automaker had been looking for a partner that would help them develop a range of small to lower medium front-wheel drive cars in a short period of time. Aside from Fiat, Chrysler LLC execs had been in talks with China's Chery Automobile as well as with Nissan. Up until now, the only deal sealed was with Nissan that resulted in the creation of the Versa-based and South America bound, Dodge Trazo.

The Fiat Group that only sells Ferraris and Maseratis in the U.S., has been constantly delaying the return of its Alfa Romeo brand in the States. A possible deal with Chrysler could help the Italians speed up Alfa's comeback as well as bring other models of the group like the highly successful Fiat 500 and the Abarth range. To do so, Fiat would have to build the cars here in the U.S. in order to price them competitively and distribute them through Chrysler, Jeep and Dodge dealers.

Via: Reuters