In the wake of reports of a possible merger between Chrysler and General Motors, the company has begun looking for partners to build its mid-size platform. The new car will replace the Sebring/Avenger pair, and will likely feature alternative powertrains including hybrid and all-electric options.

Chrysler says it could do the job alone, but would prefer to have help in order to reduce costs, reports Automotive News. So far, Project D is having as tough a time as the models it was designed to replace, with project leader Mike Donoughe quitting last spring after a dispute with upper management and the now-weak position of the company thanks to the troubled market and financial sector.

No matter the difficulties, CEO Bob Nardelli has put an outside window of five months on the decision to build its new mid-size car with a partner or attempt to go it alone.

Nardelli hinted earlier this year that several unexpected vehicles and platforms could be unveiled by as early as next year in response to changing market conditions in the U.S. and demand for smaller and more fuel-efficient vehicles. While Chrysler has confirmed that it’s developing its own global mid-size platform - internally known as ‘Project D’ – vehicles based on the new architecture aren’t expected to be introduced for several years at least.

In the meantime, Chrysler is considering jointly producing vehicles with another carmaker and has been rumored to be in talks with Nissan, Chery and even Fiat and Tata.

According to the Wall Street Journal, Chrysler is in negotiations with Nissan over a deal that would see the Japanese carmaker supply midsize sedans to Chrysler for sale in North America. Both companies have been in talks since April, when they signed a tentative agreement to supply each other with vehicles.

A spokeswoman for Nissan confirmed that there had been talks between the two carmakers but declined to comment on the latest claims about a new midsize sedan.

Nissan and Chrysler have already undertaken one partnership, which will see Nissan produce a unique version of its Versa compact (pictured) for Chrysler, which plans to sell the car in North America, Europe and other global markets by the end of the decade. Chrysler would then supply Nissan with a full-size pickup that’s set to go on sale in North America in 2011, though current market trends may mean that particular detail may have to change.

The Chrysler version of the Versa will be manufactured at Nissan's Oppama Plant in Japan. The car will have its own unique styling and specifications levels. In January, the two carmakers also announced Nissan would supply Chrysler with a Versa-based sedan for sale in South America starting next year.

Nissan’s new pickup will be manufactured by Chrysler at its Saltillo factory in Mexico, reports Automotive News. To free up capacity for the new truck, Chrysler will shift Dodge Ram production to its St. Louis North and Michigan plants.