Fiat joins forces with Chrysler

Fiat and Chrysler have agreed to join forces thanks to a deal that could result in one of the largest car company alliances in the world, Auto Express can reveal.

In an official statement, it was outlined that the agreement would see Fiat take a 35 per cent state in the troubled US car maker, while Chrysler would use Fiat's JTD diesel engines and the Italian company's platforms too.

The mooted deal could not have come at a better time for Chrysler. The company was on the brink of bankruptcy only a few weeks ago and has been kept afloat by a huge US Government loan.

As well as Fiat platforms and engines, Chrysler will benefit from the firm's worldwide network, help it to launch models in new markets. In return, Fiat would gain access to Chrysler's US dealers, allowing it to re-launch Alfa Romeo in America and also launch the Fiat 500 there too.

The deal is a major step forward in securing the future of Chrysler. Chairman Bob Nardelli said that it "creates the potential for a powerful, new global competitor" while Fiat boss Sergio Marchionne said it represented "a key milestone in the rapidly changing landscape of the automotive sector".