(ANSA) -Italy's Fiat and America's Ford Motor Company have signed an agreement to develop a common platform which will allow each company to produce a new city car model, it was confirmed here on Monday.
"The cooperation accord with Ford represents a further step in our strategy of striking specific alliances aimed at sharing the financial and industrial costs of new products and platforms," Fiat CEO Sergio Marchionne said after the announcement of the agreement.
Fiat shares jumped 1% here Monday morning after the accord was announced.
Fiat will use the platform, based on the one it currently uses for its small'Panda' car, to produce a new '500' model, while Ford will use it to produce an updated version of its 'Ka' city car.
The two future models, Marchionne observed, "will be very different from a design point of view, with both the interior and exteriors reflecting the identity of each marque."
"By working together, Fiat and Ford will be able to reduce development costs and make savings both in production and in the acquisition of component parts," he added.
Aside from using the 'Panda' platform, the new city or 'Segment A' cars will both be produced at the Fiat plant in Tychy, Poland, using Fiat the engines and transmissions. The new cars are expected to hit the showrooms sometime between 2007 and 2008 with an annual production of some 240,000 vehicles, divided equally between the Fiat and Ford models.
Fiat first announced that it was in talks with Ford last September. The following month Ford made it clear that any agreement with Fiat would be limited to the production of a new city car and it did not foresee expanding a future accord.
The Italian automaker has similar 'targeted' cooperation agreements with PSA Peugeot-Citroen, Suzuki and Tata Motors. (Photo: a prototype for the new Fiat 500)
