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It's not impossible at all. In Argentina and Spain, some folks used to adapt bigger engines, up to 1.6L, into the Fiat 600 platform. Well, maybe a 1.3L Multijet (if you could find it in America) would be a good option. Regarding transmissions, it might worth to note that few ones were retrofitted in Brazil with Volkswagen transmissions and engines during the 70s and 80s due to the absence of replacements back here. Eventually a Volkswagen Diesel wouldn't be the worst choice, after all...
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