FILE PHOTO: CEO of Fiat Chrysler Automobiles (FCA) Mike Manley attends the North American International Auto Show in Detroit, Michigan, U.S., January 14, 2019. REUTERS/Rebecca Cook

MILAN (Reuters) - The European carmakers' association (ACEA) has appointed Fiat Chrysler FCHA.MI Chief Executive Mike Manley as its new president from January 2020, it said on Thursday.

Manley will take over the role from PSA PEUP.PA Chief Executive Carlos Tavares, who has served two one-year terms as ACEA President, the Brussels-based lobby group said in a statement.

Manley is helping Fiat Chrysler Chairman John Elkann - the head of Italy’s Agnelli family which controls FCA - in talks with Tavares to finalize a merger agreement between the two groups which would create the world’s fourth-largest automaker.

FCA and PSA, the maker of Peugeot and Citroen, are expected to sign a binding agreement by the end of the year..

ACEA said its priorities for next year included setting a plan on how to manage the transition to carbon-neutral road transport while ensuring the economic sustainability of the European auto sector.

The ACEA president is elected for one year, with the option for a further one year term, by the CEOs of the group’s associates - the 15 largest Europe-based car, van, truck and bus manufacturers.