WARSAW, Poland — Fiat-Chrysler and Romania’s leading defense group Romarm are considering to launch joint production of military vehicles at the Romanian company's plant in the capital Bucharest, company representatives told local news agency Agerpres.

Under the plan, the state-run Romarm is to assemble the four-wheel-drive Jeep J8 at its Uzina Mecanica Bucuresti (UMB) factory. The two manufacturers are also considering extending their cooperation to making other military vehicles, according to Romarm.

The announcement was made following a meeting between company representatives from Fiat-Chrysler and Romarm. The deal is expected to boost the production of the Bucharest-based plant, which operates at only 10 percent of its capacity.

Neculai Banea, the state secretary at the Romanian Ministry of Economy, said that, starting in 2017, the Defense Ministry will increase its budget to 2 percent of the country's gross domestic product as a result of amendments to the country's military procurement policy.

This means the partnership between Fiat-Chrysler and Romarm could pave the way for the Defense Ministry to award more orders to the consortium. The companies could also bid for military vehicle contracts in neighboring countries such as Poland, where a similar tender is underway.

UMB specializes in producing and upgrading tracked and wheeled armored vehicles. Its product range includes the TR-85-M1 tank, which is operated by the Romanian Armed Forces. Romarm also makes artillery, missile systems and personal weapons.

Romarm was established in 2000 with the aim to consolidate Romania's fragmented defense industry. The company owns 15 subsidiaries in Romania, including production facilities and a research and development entity.

In addition to the domestic market, Romarm says it exports to more than 50 foreign markets worldwide, including countries in Europe, North and South America, Asia and Africa, according to data from the manufacturer.

Jaroslaw Adamowski is the Poland correspondent for Defense News.

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