Fiat-Volvo Partnership a New Possibility

Fiat-Volvo Partnership a New Possibility

A few years ago, Italian auto giant Fiat was very close to partnering up with General Motors. However, that deal went sour at the last minute and a few years after that, Fiat bought a big chunk of Chrysler in its quest to have a large slice of the American market.

More recently, the company was in the news announcing that Fiat is looking to partner up with Mazda or Suzuki, which would not only help expand Fiat’s reach into the Asian market, but also co-develop future small car platforms and technologies together.

Not content with sitting idling by, waiting for deals to happen, Fiat/Chrysler are constantly seeking alliances to further its growth.

The latest round of news from the 2012 Geneva Auto Show is that Fiat is “open to Volvo talks.” Fiat boss Sergio Marchionne expressed that he is “interested in talking to everyone that wants to talk with me.”

Volvo, which is now owned by the Chinese auto firm Geely, wants to expand itself in the small car segment in developing markets which makes Fiat an good fit because it already has plenty of small cars in its line-up. This tie-up could prove very beneficial for Volvo, to offer a new small car, without going through the expense of designing and engineering a complete new vehicle itself.

Fiat will benefit by finding a route into the Chinese market, which is currently the fastest growing economy in the world.

As for future drive-train technologies, Marchionne says; “There’s still lots of unexplored technology with combustion. Future drive-trains need to be cheaper and more cost effective.”

While Fiat is to introduce its first electric car later this year, the 500e (shown above), it only did so because it pooled technology from a host of companies already in the electric car field and thus saved cost of developing a complete new system themselves.

When asked if Fiat was in talks with PSA Peugeot Citroen, Marchionne denied the claim saying, “I would not like to be GM. The integration for the cost does not go far enough and would not have met our requirements.”

Fiat was at one point in talks with GM to take over Opel-Vauxhall and Saab, and Marchionne confidently said he could have “found a solution for the brands.”

Will Fiat and Volvo become partners or will they form an alliance with Mazda or Suzuki? Only time will tell.

[Source: Autocar]


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