After a successful dealership network arrangement, Indian auto manufacturer Tata Motors and Fiat Group have signed a memorandum of understanding (MoU) to establish an industrial joint-venture in India to manufacture passenger vehicles, engines and transmissions for the Indian and overseas markets.

According to a joint release, both Fiat and Tata vehicles are expected to be manufactured in the same industrial facility at Ranjangaon in Maharashtra.

Fiat and Tata also announced that they have agreed to enter into a 60 days study aimed at exploring industrial and commercial cooperation in Latin America. The study, in particular, will be focused on different vehicles, especially utility vehicles and pick-ups and on exploring the opportunity of using the existing Fiat production facilities in Cordoba, Argentina. Products manufactured there would be sold in various Latin American and overseas markets under both Fiat and Tata brands, the release said.

In his statement, Fiat Group Chief Executive Officer (CEO) Sergio Marchionne said, ''As we said at the time we signed the distribution agreement in India, this is a strategic partnership which is evolving by leveraging on the respective strengths and continuously identifying new opportunities to be jointly exploited.

Ratan N Tata, Chairman of Tata Group and Tata Motors, said: ''This is the beginning of what promises to be a far-reaching, long-term relationship between Fiat Group and Tata Motors.

Fiat is an industrial enterprise focused on the automotive sector, serving customers in more than 190 countries around the world with an annual turnover of about 47 billion euro, while Tata Motors, the flagship company of the Tata Group, is India's largest automobile company and has over three million Tata vehicles plying in India.