Fiat to build two new minivans in Serbia instead of Italy

Article by Christian Andrei, on August 27, 2010

Instead of Italy, Fiat S.p.A. will be producing its two new minivans in Serbia, according to CEO Sergio Marchionne. There are also plans for Fiat to build four other models (including Alfa Romeo and Chrysler group cars) in other countries instead of Italy. It was announced last December that the replacements for the Idea and Multipla minivans will be built in Fiat's Mirafiori plant in Turin, Italy.

However, Marchionne said last Wednesday that this plan was reversed after Fiat failed to receive enough workers' concessions to assure the "governability" of its Pomigliano d'Arco plant, near Naples.

In a conference call, Marchionne told analysts that it would be risky to confirm new investment in Italy due to the "uncertainty" of a labor agreement to increase productivity at Pomigliano.

Fiat will pour a 1 billion euro investment to install 190,000 units of annual capacity at its plant in Kragujevac, Serbia, to produce the new minivans, code-named LO. Fiat wants to start production of the models sometime in late 2011 or in early 2012.

It's also possible that Fiat will throw out plans to produce the Alfa Romeo Giulia mid-sized car, which will replace the 159, and the Chrysler Sebring successor at Mirafiori. Fiat may also scrap plans to produce a new compact sedan for either Chrysler or Dodge in Cassino, central Italy. [via autonews]

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