Chrysler, Nissan likely to join hands for midsize cars

Tuesday, August 12, 2008, 15:46 by Auto Correspondent

Auto giants Chrysler and Nissan Motor Co are likely to enter into a a possible partnership soon. The proposed alliance may have the potential to help Chrysler give shape to a new business model. The two companies are said to have been discussing an agreement under which Nissan would produce midsize sedans that Chrysler would sell in the US under its own brand name.

Chrysler LLC, with its base in North America, currently occupies the number three slot among automakers in the USA. The company has focused on its engineering resources on parts of the market where it is a strong player. Chrysler is particularly strong in trucks, SUVs and minivans.

It may be recalled that Chrysler and Nissan had struck a deal under which Nissan was to make a small car for Chrysler, using the American company’s design. It was also agreed upon under the agreement that Chrysler would build a new full-sized pickup truck for the Japanese automaker using Nissan’s auto making strategy. The new potential agreement is expected to take this forward.

The talks regarding the new deal are currently on and Chrysler is in parleys with Nissan, and Nissan is evaluating whether it makes financial sense to partner with the American major. The new move follows Chrysler’s acquisition by Cerberus Capital Management last year. It may be seen that the acquisition aimed at addressing an unfocused vehicle lineup and to answer customer complaints ranging from materials, interiors, noise and vibration.