Fiat and Tata Motors have decided to keep their manufacturing JV intact, but Fiat also plans to open its own brand dealership in select Indian cities.

"Fiat will continue to sell its cars through Tata Motors," Marius D'Lima, head of corporate communications at Fiat India said.

Fiat will continue to use the Tata distribution network in India to sell its cars, however in 20 select cities where Tata dealerships already exists, Fiat will be allowed to open separate showrooms for Fiat cars.

Rajeev Kapoor, chief executive and president of Fiat India Automobiles stated, "Having our own showrooms should help boost sales to a considerable extent. When demand increases, production will obviously increase.

Fiat India JV of Fiat and Tata, produces cars and engines at its Ranjangaon plant. The plant is responsible for the production of around 200,000 cars and 300,000 engines.

The plant's production line includes cars such as, Fiat's Palio Stile, Grande Punto hatchbacks, Linea sedan along with Tata passenger cars.

Fiat chief executive Sergio Marchionne said that the company plans to stay in the JV, however it will change the terms of the JV to benefit both Fiat and Tata.