Tata open to Fiat selling Nano cars

Indian carmaker Tata Motors is open to Italy's Fiat helping to sell the ultra-cheap Nano model overseas, Chairman Ratan Tata said on Tuesday.

Tata, India's third-biggest carmaker, plans to launch the Nano later this year, priced at about $2,500.

"We have held talks about the Nano being marketed in markets where Fiat has already a strong presence. I am open to consider a partnership," he told a news conference at a forum promoting cooperation between Italian and Indian companies.

Fiat has a joint venture with Tata to manufacture and distribute cars, engines and commercial vehicles.

Tata also said the Tata group was in talks with Italian defense and aerospace company Finmeccanica about supplying helicopter parts.

Fiat Chairman Luca Cordero di Montezemolo said the company was in talks with Tata about making buses and trucks.

"We'll see if there are the conditions for us to go forward," he told reporters on the margins of the forum.

The head of Fiat's Iveco truck unit told an Italian newspaper in May he expected to resume talks with Tata on possible accords after the India partner completed its acquisition of Jaguar and Land Rover.

Cordero di Montezemolo also said he was "very optimistic" about second-quarter results due to be released on Wednesday.

Analysts polled by Reuters have forecast that Fiat would post an 11.4 percent rise in group trading profit, despite the worsening car market in Europe, thanks to strong sales in Brazil and support from its truck and tractor businesses.

Fiat shares closed down 0.92 percent at 10.432 euros as the DJ Stoxx auto index was flat.

VW second quarter profit beats expectations

Second-quarter operating profit at Volkswagen rose 22 percent to 2.12 billion euros ($3.38 billion), the world's fourth-largest car maker said on Wednesday, easily beating market expectations.

A Reuters poll of 20 analysts forecast operating profit to increase 4.4 percent on average to 1.81 billion euros in the quarter from its very strong performance a year ago, putting it on track for an estimated 6.61 billion over the full year.

VW reaffirmed its guidance for an unspecified improvement in results this year.

Renault plans production cuts in Douai, France

Renault has decided to cut production at its factory in Douai, northern France, in response to the worsening European sales outlook.

The French carmaker said last week it would also shut a factory in Sandouville, France, for seven days in September on top of a four-week closure in August.

In Douai, Renault has negotiated with unions at least 20 days of shutdown in the July-November period to counter declining demand for cars based on its Megane platform.

Renault produced 268,090 Scenic medium minivans and just more than 40,000 lower-medium Megane cars during 2007 at the Douai site, which employs 5,400 workers.

The company will present a radically restyled version of the Megane during the Paris auto show in early October.

Company sources say anticipation of the new Megane models has slowed sales for the existing versions.

The continuing slowdown in key European markets such as Italy and Spain, where Renault's Megane line has strong market shares, also contributed to weak demand for cars produced at Douai.

The Douai site was initially slated to close from late-July to late-August, for four weeks of annual maintenance.

Weak demand for the Megane and Scenic led management to negotiate a series of three-day weekends with workers in July, September, and October, a company spokesman said.

Renault will also close the Douai site from October 22 to November 12, to coincide with the French autumn school vacation and two national holidays, on November 1 and 11.

Word of the Douai slowdown comes just days after Renault announced that it would shut its factory in Sandouville, northern France, for seven days in September, on top of a planned four-week closure in August.

The Sandouville shutdown is directly linked to poor sales of Renault's upper-medium Laguna.

The French carmaker may also suspend Laguna production for at least three days in October, company sources say.