Fiat Negotiates with Chrysler

The Fiat Group is talking about a deal with the Chrysler LLC to seal a deal and establish strategic bond that may include a Fiat stake in the struggling U.S. car manufacturer.

The partnership will allow Chrysler to fast track and improve its restructuring plans and efforts.

A reliable source revealed that the Fiat group may allow Chrysler to access its line of car platforms, transmissions, and engines. This move will allow Chrysler to come up with a new range of small and mid-sized vehicles that have low emissions.

Chrysler has linked with Nissan for the production of small cars using the platform of 2010 Dodge Hornet.

In exchange for the range production, Fiat will gain a 30% to 35% stake in the company. A European newspaper published that the two companies have signed a memorandum of agreement to formalize the alliance.

Chrysler’s move may also be timely to allow the company to respond to market demands for smaller, more efficient and low emission cars. GM and Ford has a production line which focuses on this interest of the market. As of today, Chrysler does not have a similar line of offerings.

Fiat also gains access to the market of the United States. It may expand its network using the operations and distribution arms of the U.S. car manufacturer.

The Alfa Romeo brand from Fiat canceled its launch to the U.S. market to 2011 because it cannot find a partner to help in the production and distribution of the cars.

Fiat will save a lot of money with their partnership with Chrysler. On the other hand, the U.S. firm will be able to access the network of Fiat in Latin America and Europe.

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