ROME (Reuters) - A possible tie-up between Fiat Chrysler FCHA.MI and Peugeot owner PSA PEUP.PA must be a "merger of equals" that leads to no job losses in Italy, Italian trade union UILM leader Rocco Palombella said on Wednesday.

FCA and PSA have confirmed talks over a potential tie-up that could create a $50 billion automotive giant better placed to tackle costly technological and regulatory challenges facing the industry.