Fiat Chrysler Automobiles CEO Michael Manley has said that merger talks with PSA Group are progressing well and he hopes to have a deal sealed within 12 to 14 months.

Manley said he does not expect any major obstacles that could delay a final agreement which will create the world's fourth biggest automaker.

"Talks are progressing really well," Manley said about negotiations with the French automaker.

His comments come a month after the two car manufacturers agreed a deal to combine forces.

The deal worth about $50 billion comes as a response to the slowdown in global demand and mounting costs of making cleaner vehicles amid tighter emissions regulations.