Chrysler, Nissan End OEM Projects

American manufacturer Chrysler and Japanese carmaker Nissan announced today, through a joint release, they have dropped plans for three OEM vehicle-supply projects announced ever since last year. The aforemetioned programs, which included provisions such as Nissan providing a compact sedan for Chrysler to use on the South American market, have been deemed not viable.

"For the past several months, teams from both companies have been studying the viability of the projects in light of significant changes in business conditions since the projects were announced in January and April of 2008. Today, it was decided it was in the best interests of both companies to end the projects," the two companies said in the joint release.

Together with the idea of a Nissan compact sedan for Chrysler, two other joint efforts were being looked into by the two sides. One implied Nissan providing a small vehicle to Chrysler for the Americans to use on a global level starting 2010. In turn, Chrysler was supposed to provide Nissan with a full-size pick-up truck starting from 2011.

Both sides announced that a separate agreement, in effect since 2004, involving the supply of transmission form Nissan's JATCO to Chrysler will remain unchanged.

The end of the future projects between the two carmakers is seen as a result of Chrysler's new involvement with Fiat. The American manufacturer now has an excellent source of small cars, without having to get involved into costly joint ventures.

Nissan didn't mentioned whether it will focus on finding a source for a full-size pick-up truck elsewhere or will drop the idea completely.