Chrysler might leave Global Engine Manufacturing Alliance

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As Chrysler moves forward with its post bankruptcy product plans, it's looking increasingly like consolidation with new partner Fiat is the order of the day. Following the cancellation of the platform sharing deal with Nissan, it appears as if the company's interest in the Global Engine Manufacturing Alliance could be the next victim. The agreement in question was formed early this decade between what was then DaimlerChrysler, Hyundai and Mitsubishi to produce common four-cylinder engines for the three automakers. Since then, variants of the engine design have turned up in cars as diverse as the Jeep Compass and Patriot, Hyundai Sonata and Mitsubishi Lancer.

Part of Fiat's rationale for getting involved with Chrysler was the expanding economies of scale for its own products. That means future Chryslers will almost certainly get Italian designed fours to go with the company's new Phoenix V6. It's not clear what the fate of the five-year-old Dundee, MI engine plant that supplies the Chrysler engines will be. If the alliance is dissolved, it could be taken over by Chrysler-Fiat and re-tooled to build Fiat-based engines.