Fiat chief executive Sergio Marchionne will head up US automaker Chrysler after its bankruptcy procedure and tie-up with the Italian group are completed, a spokesman for Fiat told AFP on Thursday.
"Marchionne will be the new chief executive of Chrysler after the procedure," the spokesman said after Chrysler last week filed for bankruptcy protection and said it would partner with Fiat.
Chrysler chairman Robert Nardelli announced earlier that he would stay on only to oversee the bankruptcy procedure and that he should be replaced by a figure from the Italian automaker.
In mid-April, Marchionne had already said it was "possible" that he would head both companies.
"Fundamentally, that's possible, but the title isn't important. What's important is that they hear me" at Chrysler," Marchionne told the Canadian daily the Globe and Mail.
"It's possible that I will have to divide my time between running Fiat and running Chrysler," the maverick industry chief added.
Chrysler's new board of directors, which will have six members chosen by the US government and three by Fiat, is expected to name an American chairman, press reports said.
With his new portfolio, Marchionne follows the example of Carlos Ghosn, who heads bother Renault and Nissan, AFP reported.
Marchionne, a Canadian-Italian who has been Fiat's administrator since 2004, is credited with saving the Italian group from collapse.
Chrysler, which filed for bankruptcy last week, agreed an alliance with Fiat that will initially give the Italian company a 20 percent stake.
In return, Fiat will allow access to its technology to enable the US carmaker to make the smaller, greener cars that are increasingly in demand.
Fiat may eventually take control of the group if Chrysler manages to pay back its state aid by 2013.
The US administration has set a target of late June for Chrysler to regain solvency.
Fiat is also interested in the European arm of General Motors, notably its Opel subsidiary in Germany, on the way to creating one of the world's biggest automotive groups.
An Italian industry source said Fiat is also eyeing GM's Latin American operations.