Fiat Chrysler Automobiles (FCA) has improved its offer to Renault for the proposed $35 billion merger of the two carmakers.

The Italian-American company is discussing a Renault special dividend and stronger job guarantees in a bid to persuade the French government – the majority stakeholder in Renault with 15% – to back its merger plan that was announced last Monday, sources close to the discussions said, reported by Reuters.

The improved pitch also offers the combined company’s operations to be headquartered in France and the French state granted a seat on its board, the report adds. The concessions being discussed are not definitive and depend on other aspects of an emerging compromise deal, the sources cautioned. FCA, the French government and Renault declined to comment.

The newswire pointed out that some analysts and French industry leaders had voiced doubts about the claimed five billion euros in cost and investment savings the merger would bring, and whether the proposal is a fair deal for Renault shareholders. A Renault dividend would improve the valuation in the French side’s favour, balancing a 2.5 billion euro proposed dividend to FCA shareholders. No mention on the potential size of a Renault payout, though.

The merger of equals plan would see the two carmakers acquired by a Dutch-listed holding company whose ownership would be split equally between current FCA and Renault shareholders, after special dividend payments.

According to the sources, FCA’s original proposal wanted the combined group’s operational head office in a neutral city, most likely London, but greater Paris is also now a possibility. Doing so would meet a key demand by the French government, which will have a 7.5% in the combined company. Nissan would also be given a board seat for its new 7.5% stake in the merged entity – for the latter, it would be an upgrade from its current non-voting 15% stake in Renault.

Maintaining jobs would also be a high priority of the French government, which of late had to grapple with the yellow vest movement by a disgruntled electorate. Guarantees to maintain Renault’s blue-collar jobs in France and industrial sites could also be extended to four years from the initial two, the sources added.

Job guarantees and the Nissan situation are two big hurdles to forming the world’s third-biggest carmaker – it remains to be seen if the issues can be ironed out.

Should it happen, a joint FCA-Renault would be only behind Toyota and the Volkswagen Group in terms of global car sales. Include Nissan and Mitsubishi, and combined sales will be by far the largest in the industry. On FCA’s side, besides the two namesake brands, its other marques include Abarth, Alfa Romeo, Dodge, Jeep, Lancia, Maserati and Ram Trucks. Ferrari was spun-off the group in 2015.