Fiat's chief executive said he was ready to abandon plans to form a partnership with Chrysler LLC if the U.S. car maker's unions refused to accept substantial cost cuts, according to a newspaper.

Absolutely we are prepared to walk, Sergio Marchionne said in an interview published on the website of Canada's Globe and Mail on Wednesday. We cannot commit to this organization unless we see light at the end of the tunnel.

Marchionne said he saw only a 50-50 chance of the partnership being formed due to the lack of progress on labor negotiations, especially on the side of the Canadian unions.

Fiat confirmed the comments made by Marchionne to the newspaper.

(Reporting by Gilles Castonguay and Ian Simpson)