Fiat hints at creation of car giant

Fiat has confirmed it is in talks to buy most of General Motors’ European operations, taking another step towards creating a global carmaking powerhouse.

Fiat also said yesterday it is evaluating the possible spin-off of its car business to form the core of a new company.

Fiat Group Automobiles includes the Fiat, Alfa Romeo and Ferrari brands. In addition, Fiat is in the process of acquiring US carmaker Chrysler LLC without putting up any cash.

The new auto company, which according to Fiat would have $105bn in annual revenue, would put the Italian carmaker in markets where it has little or no presence, including North America, traditionally the largest market in the world.