Late this afternoon Chrysler and Nissan announced a major product cooperation deal that would allow both automakers to focus on their current product strengths while expanding their lineups with new entries. Beginning in 2010 Nissan will start making a new small car for Chrysler while a year later, Chrysler will start building a new full-size pickup truck for Nissan. The small car will be built to a Chrysler design and will be sold in North America, Europe, and other markets. The truck will be built for Nissan at Chrysler's Saltillo Mexico assembly plant starting 2011 and will presumably replace the current Titan pickup.

Nissan has been looking for a diesel engine supplier for some time for the Titan and this deal will likely allow them to use the new Cummins light duty diesel that is debuting next year. It's not known at this time if Nissan will get a heavy duty pickup out this deal. Another unknown is whether Nissan will get a truck equipped with the two-mode hybrid system that is debuting in the Ram in 2010. Chrysler and Nissan earlier this year announced a deal to sell a re-badged version of the Versa as a Dodge in South America. Another unknown is the fate of the Chrysler-Chery deal to build small cars in China. We'll have more later this evening after a Chrysler conference call.

Update 1: According to LaSorda the Chery discussions and planning are still ongoing and products may still happen badged as Chrysler vehicles. Chrysler feels that at some point they may need more than one small car so potentially both Chery and Nissan based cars could be sold.

Update 2
: The small car will be built on a Nissan platform with Chrysler styling. The platform is a new platform but Chrysler isn't yet saying what platform it is. It's not the current Versa.

Update 3: No news on the diesels or hybrids. Unfortunately they cut off questions before we had a chance to ask. We'll try to follow up on this one.

[Source: Chrysler, Nissan]

Chrysler LLC and Nissan Motor Co., Ltd. issued the following press release on Monday:

AUBURN HILLS, Mich / TOKYO (April 14, 2008) – Chrysler LLC and Nissan Motor Co., Ltd., today announced two new agreements for the supply of products between both companies. In January, Nissan agreed to supply Chrysler with a new car based on the Nissan Versa sedan for limited distribution in South America on an Original Equipment Manufacture (OEM) basis in 2009.

This new OEM exchange benefits both companies through range extension and the utilization of global manufacturing capacity. Highlights of the new agreement:

Nissan will manufacture an all-new, fuel-efficient small car based on a unique Chrysler concept and design. This new segment entry for Chrysler will be sold in North America, Europe and other global markets in 2010, and manufactured at Nissan's Oppama Plant in Japan.

Chrysler will manufacture a full-size pickup for Nissan. Based on a Nissan unique design, this truck will be manufactured at Chrysler's Saltillo (Mexico) Assembly Plant. In order to accommodate this product, Chrysler will shift volume from Mexico to its U.S.-based assembly plants that produce pickup trucks. Sales of the pickup in North America will start in 2011.

This latest OEM supply agreement extends a long standing product exchange relationship between the two corporations, with Nissan affiliate JATCO already supplying Chrysler with transmissions since 2004.

"Forging the right tactical partnerships is critical to the long-term success of Chrysler," said Tom LaSorda, Chrysler LLC President and Vice Chairman. "It also builds on the Company's inherent strengths, including the ability to respond rapidly and creatively to emerging opportunities."

"In January, we said we would continue to look for additional OEM opportunities with Chrysler," said Carlos Tavares, Executive Vice President, Nissan Motor Company. "This latest agreement builds on Nissan's proven track record to deliver win-win product exchanges with multiple manufacturers around the world," continued Tavares.
Since the signing of the first OEM agreement in January, the two companies have also agreed to maintain an open dialogue to explore further product-sharing opportunities.

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