Sergio Marchionne, Chief Executive Officer of Fiat, and Jean-Martin Folz, Chief Executive Officer of PSA Peugeot Citroën, yesterday announced a new important milestone in the partnership between the two groups at the Sevel plant in Atessa (Chieti, Italy), the largest light commercial vehicle production facility in Europe.

Cooperation between the two groups for the development of a commercial vehicle began in 1978 and was rewarded over time with a huge commercial success. In January 2002 this cooperation was extended until 2017. The agreement signed in 2002 defined the terms for the development and industrialisation of two new light commercial vehicles ranges, the first of which was unveiled yesterday at the Atessa production facility. Production of the second range of vehicles will start at the end of 2006 at the other joint facility located in Valenciennes (France), where the Fiat, Lancia, Peugeot and Citroën-branded large MPVs are also manufactured.

More recently, in March 2005, the two groups signed an agreement to develop and produce a third vehicle: it is a new "minivan" that will be manufactured in the Bursa plant in Turkey under the coordination of Tofas and in close cooperation with the two companies.

Production of the new family of commercial vehicles, referred to with the product code X250, began a few days ago at the Atessa plant. The two groups invested over €1.1 billion for this new vehicle.

The new Fiat Ducato, Peugeot Boxer and Citroën Jumper (known as Relay in the UK) build on the heritage of models that have been market leaders in Europe for the past seven years, with over 2 million units sold. This new generation of commercial vehicles sets new standards in terms of range variety, load capacity, performance, comfort and running costs.

In a further development of the relationship between Fiat and PSA Peugeot Citroën, a new industrial agreement has been signed.

Starting in 2007 the Fiat Auto plant in Cordoba, Argentina, will assemble a PSA Peugeot Citroën gearbox to be mounted on the Peugeot and Citroën cars sold in South America. Within this 10-year agreement annual production is scheduled at 140,000 units.