Speculation over Fiat and Chrysler teaming up has ended after the carmakers confirmed they will be working together.

Both have entered into a "mutually beneficial" partnership to roll our over the next five years, reports the Mopar Muscle website.

For Chrysler, Fiat brings the experience of fuel efficient cars and will supply the US maker with compacts, sub-compacts and city vehicles, while benefiting from a pre-establised dealer network as the trade-off.

The deal comes with no cash investments from either party, but does tap into the established networks each currently own.