Fiat and GM in the news today.

[GLewis4457@domain.elided]

GM May Become Fiat's New Partner

By PETER W. MAYER
.c The Associated Press

  
ROME (AP) - Italian automaker Fiat is on the verge of striking a partnership 
deal with General Motors, Italian news reports said Sunday. 

The Turin-based company is expected to make a formal announcement of a deal 
with the U.S. automaker during a board meeting on Monday and Tuesday. 

``An inevitable move,'' Foreign Trade Minister Piero Fassino said of an 
alliance between Fiat and a foreign carmaker. ``Whoever wishes to hold on to 
Fiat in its present form risks marginalizing it further and further,'' he 
told the Rome daily La Repubblica. 

In Detroit, GM spokesman Tony Cervone declined to discuss the reports, saying 
``it would be inappropriate to comment on speculative rumors.'' 

``There's an obvious trend in the industry toward consolidation, and there 
have been a lot of rumors and speculation floating around about where the 
next consolidation might be,'' Cervone said. 

Fiat is Italy's largest private employer and a national institution. But it 
has slipped for years in the European market and taken a beating in South 
America, where car sales plunged with the 1990s economic downturn. 

Its share of the Italian market, once 60 percent, has dwindled to 39 percent 
as competition eroded its dominance. In 1998, Fiat claimed only 11 percent of 
car sales in Western Europe. 

Despite the merger trend among major automakers, and rumors linking Fiat to 
General Motors, DaimlerChrysler and other companies, the Agnelli family's 
hold on Fiat has remained tight. 

But Gianni Agnelli, Fiat's honorary chairman, recently said that the company 
- - whose makes include Alfa Romeo, Maserati and Ferrari sports cars - was on 
the lookout for international partners. 

AP-NY-03-12-00 0950EST

Jerry in Houston

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