Fiat Chrysler is closing in on a 7 billion dollar state loan.
Reuters sources say Rome could soon announce an agreement.
If confirmed it would be the largest crisis loan for a European carmaker.
French rival Renault has already tapped its government for about 5.7 billion dollars.
Now FCA’s Italian division aims to use the country’s emergency financing schemes for a three-year loan.
It would be arranged by the country’s biggest retail bank, Intesa Sanpaolo.
The lender has already approved the deal, on condition it gets government guarantees for most of the amount.
Italian media reports say the final deal may see FCA commit to increasing its investments in the country.
And the company’s merger with Peugeot-maker PSA is still expected to go through.
The media reports say FCA will be allowed to pay a special dividend of about 6 billion dollars once that deal goes through.
FCA shares rose 1.8 percent in early trade Monday (June 22), outperforming the broader market.
PSA shares were up over 3 percent.