Ford and Fiat to co-develop small cars

Small cars are the way to go these days it seems. Fuel prices are rising on a daily basis and the roads are proving to be inadequate for the large number of cars we have on roads today. Japan is already known for their small cars and the benefits the manufacturers get for making small cars. Now, even the American makers are getting into making these small cars as the market is getting bigger and bigger for these products.

America’s second largest automaker Ford is joining hands with Italian manufacturer Fiat to co-develop two small cars. These cars would be replacing the aging models like Fiat 500 and the Ford KA small cars with common parts and components. However, the cars would be looking quite different from each other to maintain their identity from the two different manufacturers.

Fiat is in financial mess and they are looking towards saving around 500 million euro in costs this year by cutting jobs. The joint venture would help them to develop these cars at lower costs. Fiat aims to return to profitability in the next 2 years… they are heavily relying on their brands like Ferrari and Alfa Romeo to save the whole brand.

Fiat and Ford seems to be inspired from a similar collaboration between PSA Peugeot Citroen and Toyota Motor who co-developed Peugeot 107, Citroen C1 and Toyota Aygo models and saved a lot on the projects.