Fiat, Tata Motors Indian JV to expand capacity

MUMBAI, March 24 (Reuters) - A joint venture of Italy's Fiat (FIA.MI) and India's Tata Motors (TAMO.BO) said on Monday it will sign a preliminary understanding with Maharashtra state to expand capacity at its plant in western India.

Fiat India Automobiles, which sells the Palio hatchback in India, has a plant in Ranjangaon with a capacity to make 100,000 cars and 200,000 engines and transmissions.

The company has said the agreement will be signed at 2:30 p.m. (0900 GMT) on Monday at a function in Mumbai. No other details were available.

Fiat has said it plans to launch four models in India in 2008/09 (April-March), including the Linea and Fiat 500. (Reporting by Narayanan Somasundaram; Editing by John Mair)