Fiat to sign Chinese car alliance on Monday-paper

MILAN, July 5 (Reuters) - Italian vehicle maker Fiat SpA (FIA.MI: Quote, Profile, Research) will sign a strategic alliance with China's Guangzhou Automobile Industry Group in Rome on Monday, Il Sole 24 Ore newspaper said on Sunday.

In an unsourced report, the business daily said the alliance will see a joint production plant launched in China in 2011 to produce a new version of Fiat's Linea model and, subsequently, Fiat's Bravo and Grande Punto models.

A Fiat spokesman said he could not confirm the report.

At the end of last month, Fiat Chief Executive Sergio Marchionne said the group was close to a deal on a joint venture with the Guangzhou group.

Marchionne is trying to boost the scale of Fiat as a worldwide mass car producer: this year Fiat has taken a 20 percent stake in U.S. producer Chrysler but failed to acquire General Motors GMGMQ.PK Opel unit.

Monday's Rome alliance signing ceremony will involve Marchionne and chiefs of the Chinese company, while Chinese President Hu Jintao and Italian Prime Minister Silvio Berlusconi are also expected to be present, Il Sole said.

The 50:50 alliance will relaunch Fiat's passenger auto activities in China after two years of paralysis following the ending of an alliance with Nanjing Automotive, it said.

Guangzhou is a solid, efficient, technologically advanced producer and very profitable, as well as figuring in a group of 8 large producers chosen by the government for a restructuring of the auto sector, it said.

(Writing by Nigel Tutt; editing by Simon Jessop)