Chrysler Group could exit a global joint venture engine partnership with Hyundai and Mitsubishi as the U.S. automaker moves closer to its new partner, Fiat S.p.A.

Chrysler is considering withdrawing from its partnership in the Global Engine Manufacturing Alliance, alliance spokesman Len Sennish said today.

"There are discussions about that going on at the highest levels," Sennish confirmed.

Officials at Chrysler and Hyundai declined to comment.

The Dundee, Mich., venture began producing four-cylinder engines for Chrysler models in 2005 and has a production capacity of 840,000 engines a year. The alliance is owned equally by Chrysler, Hyundai Motor Co. and Mitsubishi Motors Corp.

The Michigan operation is one of three plants in the United States, Japan and South Korea that build versions of a common four-cylinder engine platform for the partners in their home markets.

But Chrysler and its new 20 percent owner, Fiat, have been re-evaluating Chrysler's global product plans.

Last week, Chrysler and Nissan Motor Corp. said they have canceled plans for Nissan to provide Chrysler with a new Japanese-made small car and to sell a version of the Nissan Versa in South America. Chrysler also no longer will build the 2012 model full-sized Nissan Titan pickup based on the Dodge Ram.

Chrysler's new CEO, Sergio Marchionne, is also considering using a Fiat-built diesel engine on the Ram 1500 in place of a diesel that was to have been sourced from Cummins Inc., said a source who asked not to be identified. The source said Marchionne recently discussed the idea with him.

The World Engine made at the alliance comes in four configurations and is available in Chrysler, Dodge and Jeep vehicles. The 1.8-liter, 2.0-liter and 2.4-liter engines are available in the Chrysler Sebring, Jeep Compass, Jeep Patriot, Dodge Avenger, Dodge Caliber and Dodge Journey. The Caliber SRT4 is equipped with the 2.4-liter turbocharged engine.

The Dundee plant is one of four operated by the alliance. The others are in Shiga, Japan (Mitsubishi); Asan, South Korea; and Montgomery, Ala. (both Hyundai-Kia).