General Motors Buying Into Italian Diesel Maker

General Motors will buy 50 percent of VM Motori of Italy, a maker of diesel engines that is the property of Penske Corporation, in a joint venture agreement. GM had announced this spring that it would develop a new 2.9-liter V6 turbodiesel engine with VM Motori. The engine is slated to make its debut in the 2009 Cadillac CTS.

Under terms of the companies' relationship, VM Motori will handle design and development of the engine and will manufacture it at its plant in Cento, Italy. GM Powertrain Europe will work on closed-loop combustion control, electronic engine control and exhaust-gas after-treatment technologies for the engine.

GM had previously been reported ready to sell a diesel-powered Saturn Aura by decade's end, and the automaker's vice chairman, Bob Lutz, said in an Internet videocast last week that the automaker will put diesels into crossover vehicles, SUVs and passenger cars.