Calling it a medium- to long-term bet, Sergio Marchionne said the partnership, announced on Tuesday, could succeed if concessions were obtained from all stakeholders in Chrysler.

"We need to provide a framework for this to be able to generate cash and ultimately to return to a healthy level at the operating level," he told analysts on a conference call on Fiat's results.

"If the right level of concessions can be made, we can find a way to make this work," he said without elaborating.

Chrysler's unions, for one, have thrown their support behind the partnership, which will see Fiat taking a 35 percent stake in the U.S. car maker in exchange for its expertise in small cars and access to foreign markets.

Despite the sizable stake, Marchionne preferred to leave Chrysler's executives to get on with the job of turning it around.

"I have absolutely no intention of running Chrysler," he said. "(But) as we work our way through the implementation of the letter of intent (of the partnership), you will see ... that we have taken some precautions to ensure that we are not ignored."

Chrysler is now 80.1 percent owned by Cerberus Capital Management LP , a private equity firm. Daimler AG , which once owned all of Chrysler, retains the remainder.

Chrysler has received $4 billion in U.S. government loans but says it needs another $3 billion.

Marchionne showed no interest in going to Washington.

"I don't know how effective I would be," he said.

One of the terms of the loans is that Chrysler shows it can be viable by the end of March, and its partnership with Fiat is aimed at working to that end.

The partnership, however, is contingent on Chrysler getting the extra $3 billion in loans.

Marchionne tried to dispel doubts about the benefits that Fiat stood to gain from the partnership.

"The benefit to us is going to be ultimately in the access that we have to the U.S. and the shareholding that we will have in Chrysler," he said.

Fiat wants to use Chrysler's plants and dealership network to bring its cars back to the huge U.S. market that it abandoned in 1983.

It also sees Chrysler's pick-up trucks bolstering its product offering in Latin America.

The partnership is part of Fiat's effort to gain scale to survive the worst crisis to hit the car industry in decades.

Fiat is Europe's sixth largest car maker by unit sales and Marchionne has said it was too small to get through the crisis on its own.

(Reporting by Gilles Castonguay, editing by Gerald E. McCormick)