Fiat signs preliminary deal on car joint venture in China
Fiat, Italy's biggest car maker, signed a preliminary deal on Monday with Guangzhou Automobile Group (GAG) to set up a joint venture to produce cars in China.
Under the preliminary deal, Fiat and GAG will create a joint venture in Changsha, Hunan Province, with each side holding half of the shares.
Fiat and GAG will invest more than 400 million euros (555 million U.S. dollars) in the venture, which marked Fiat's comeback to the Chinese market after its failed cooperation with Nanjing Automotive in 2007.
The new company will initially make compact cars and production should begin by the second half of 2011.
The two carmakers also signed other deals worth 225 million U.S. dollars as a large group of Chinese enterprises ended a two-day tour to Italy for trade and investment promotion, securing over 30 agreements totaling 2 billion dollars with their Italian counterparts.
