Fiat Auto announced today that it is planning to build diesel engines in Asia by 2010, for use by Japanese car maker Suzuki.

This is the latest high profile study in conjunction with another car manufacturer to be announced by Fiat Auto in recent months. During September Fiat announced that a wide ranging new alliance with leading India carmaker Tata Motors would be explored, and the initial stages of an unexpected joint-venture with US giant Ford to develop a new small car in Poland was set in motion. Fiat Group and Auto Division CEO Sergio Marchionne has made targeting limited scope new alliances with other carmakers a cornerstone of his recovery plan for Fiat.

This new venture will see Fiat building their acclaimed diesel range in Asia for use by Suzuki, with the engines in question being the ground-breaking, common-rail technology, JTD units. The two carmakers have now signed a 'letter of intent' for the setting up of a new facility to provide for production of 100,000 engines annually, starting around 2010. The engines will be used in a wide variety of Suzuki's models spread across different segments, that will be sold around the globe. Fiat Auto - via their Fiat Powertrain Technology arm - will provide Suzuki with both technology and training, as well as a supply of JTD units, until Asian production gets underway in five years time.

Fiat Auto began collaborating with Japanese carmaker Suzuki several years ago when the Italian firm decided to launch a small 'SUV', and plug an obvious gap in its range, given the present day popularity of 4x4 'Sports Utility' vehicles.
 

Suzuki is part-owned by General Motors, who were Fiat's technical partner at the time, and so it was wholly logical to turn to Suzuki, the acknowledged world leader in building cars for the small "off road" sector. Fiat will shortly launch their version of a new Suzuki B-segment 'crossover' (to be known as the Fiat Sedici) either at the Bologna Motor Show in early December, or during the glamorous occasion of the XX Winter Olympics, which will be held in Turin early next year, and of which Fiat are a partner.

Lancia will also create their version of this new car (possibly called the Pangea) which will arrive on the European markets in 2006. Suzuki are targeting annual production of 100,000 units for this Eastern European-assembled vehicle, with around 20,000 of these being badged as Fiats, and 10,000 as Lancias. The current success of the Fiat Idea-based Lancia Musa, and the general resurgence of this 'luxury', Fiat-owned brand name, means the Lancia target is regarded by analysts as being very conservative indeed.