Two storied European nameplates might combine operations as rumors are flying that Fiat and PSA Peugeot/Citroën may find the road to future profits easier to travel together. The first rumblings of potential trouble at Fiat came when its CEO Sergio Marchionne suggested his company's future looked bleak without a major partner and that there was only room for six global automakers in his estimation. Now, according to Italian newspaper Milano Finanza, leaders of both Italy and France have discussed a possible tie-up between the two companies.

Both countries are said to be considering offering financial aid packages to their respective home-grown automakers, and a merger may be seen as another way of ensuring their future viability. Although the two automakers specialize in small cars and therefore have many overlapping products, the only joint-ventures currently shared between them are for commercial vehicles and MPVs. If the two Euro giants were to merge, the resulting company would roughly match the size of Nissan/Renault and Volkswagen.

[Source: Reuters]

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