Chrysler, GM seen in SUV partnership talks

NEW YORK (CNNMoney.com) -- General Motors and Chrysler Group are in talks to develop a large sport utility vehicle, that would be similar to the Chevrolet Suburban, according to a report published Thursday.

Citing sources familiar with the talks, The Wall Street Journal reported that the two automakers have been discussing that matter for six months but have yet to reach an agreement.

The paper reported that a partnership would mean development cost savings for Chrysler.

Currently, Chrysler Group does not make an SUV that rivals the Suburban. The two closest models are the Dodge Durango and the Chrysler Aspen.

The news comes just one day after Chrysler Group's parent company, DaimlerChrysler (up $0.67 to $70.45, Charts), said it was considering a sale of a sale or spinoff of its North American unit, in addition to cutting 13,000 jobs over the next three years. (Full story)

A German publication, Manager Magazin, reported that DaimlerChrysler Chairman Dieter Zetsche had met with GM (up $0.00 to $36.50, Charts) Chairman and Chief Executive Officer Rick Wagoner about a possible sale of Chrysler to the No. 1 U.S. automaker, which has itself been struggling, cutting jobs and closing plants.

The Journal reported, however, that if a vehicle deal is reached, it would not go beyond that.

Chrysler already has a handful of vehicle partnerships under way, including a minivan development deal with Volkswagen AG. Chrysler is also in talks to produce a subcompact car for sale in the United States with the Chinese automaker Chery.

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