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Fiat aims to be global powerhouse

ROME — Fiat Group SpA will be on the path to becoming a global automotive powerhouse if Chief Executive Sergio Marchionne has his way.

Marchionne is set to meet today in Berlin with German economic and foreign ministers to discuss Fiat's offer for General Motors Europe's German unit, Opel.

Fiat confirmed Sunday it is in talks to buy most of General Motors' European operations. It also said it is evaluating the possible spinoff of its auto business to form the core of a new company.

GM has been trying to find investors for its noncore and unprofitable assets to help stave off collapse. Germany is keen to safeguard the future of Adam Opel GmbH, a core part of GM's European operations, which employs about 25,000 people at four plants in Germany.

Fiat Group Automobiles includes Fiat, Alfa Romeo and Ferrari. In addition, Fiat is in the process of acquiring U.S. automaker Chrysler without putting up any cash.

Marchionne was quoted in the Financial Times today as saying of his company's plan: "From an engineering and industrial point of view, this is a marriage made in heaven."

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

"They're going to be a global powerhouse, I guess. Who would have thought?" asked Erich Merkle, an independent auto industry analyst in Grand Rapids, Mich.

Fiat is not Opel's only suitor, however. Last week, Canadian car parts maker Magna International presented German Economy Minister Karl-Theodor zu Guttenberg with what the minister called a "rough concept for a commitment with Opel."

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