With just hours remaining before Fiat can force the controversial 'put' option onto GM, news remains scarce on the progress of the negotiations.

The disputed option's 'mediation' period began prior to Christmas, when Fiat CEO Sergio Marchionne came face to face with his GM counterpart Rick Wagoner, and it wraps up at midnight tonight. Both sides have in recent weeks kept observers firmly in the dark.

The tortuous negotiations over the course of the last month have involved secret meetings between the two CEO's, and a further week's postponement of the deadline, which brought it up to today.

In what is a firm pointer to the market's view of the proceedings, Fiat's share price has soared by more than 7 percent this year as investors bet that the Italian carmaker is in line to receive a beneficial pay-off from the America giant.

Figures ranging from 1.5 to 2 billion euros have been bandied around in recent weeks as the cost to GM of avoiding being forced to buy the remaining 90 percent of Fiat's Auto Division it doesn't already own, and thus taking on what would be an additional mountain of debt for the already struggling American firm.

If no agreement is reached today, Fiat will be free tomorrow to impose the option, allowing both sides to enter the courtroom is what could turn out to be a lengthy and protracted battle. A source, regarded as being close to Fiat, commented yesterday, "If there is no deal, Marchionne will have to exercise the put on Wednesday. There's been so much posturing by now that it's the only way to save face."

GM, themselves struggling to restructure their loss-making European Adam Opel car arm, would not welcome increased manufacturing capacity at present.
 

Particularly so as they are in the midst of cutting around 12,000 jobs as they target cost-savings of more than 450 million euros per year. For their part they cite the recent recapitalisation of Fiat, and the sale of the Fidis financial arm as having invalidated the 'put' option, as they continue to fight their corner.

Fiat's share of their home market edged up during January

Provisional data released this morning by the Italian Ministry of Transport sees Fiat Auto's share of new car registrations in their key domestic market come in at 27.8 percent, down from 30.6 percent year-on-year.

However, this was up by more than a percentage point on the previous month's performance, December 2004, which saw Fiat's share  of the Italian market at 26.6 percent. Overall, the Italian new car marketplace slid by 2.7 percent in January as economic indicators all seem to point now to difficult conditions during 2005.