Chrysler confirms talks with Fiat over U.S. production

Facing serious trouble in its home market, Chrysler is looking overseas for its salvation and has reportedly been in negotiations with a number of foreign carmakers including China’s Chery Auto and Great Wall Motors, India’s Tata and Mahindra & Mahindra, and more recently Nissan and Fiat. Chrysler has now confirmed that it has been in talks with Fiat in regards to lending its under-utilized North American production capacity to build vehicles for the Italian carmaker.

The information comes from Chrysler vice chairman Tom LaSorda, who revealed to the Financial Times that no “formal” discussions had taken place but that there had been an enquiry between the two manufacturers.

The talks precede Alfa Romeo's planned return to the North American market late next year, meaning Chrysler could provide North American production facilities for the Fiat-subsidiary and thus allow it to avoid the drawbacks of importing the vehicles. Other speculation centers around the possible introduction of the wildly popular Fiat Cinquencento (Fiat 500) to the North American market, for which local production would be more profitable given the current economic climate.

LaSorda also confirmed that Chrysler expects to start selling small cars in Latin America next year made by Chery Auto in China. The carmaker also expects to finalize the designs for a new compact car being co-developed with Nissan for the North American market.