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Fiat invests more for Italy

2012-12-21 11:14

HUGE INVESTMENT: Fiat CEO Sergio Marchionne is investing more than R11-billion in an Italian factory.

MILAN, Italy - Fiat CEO Sergio Marchionne will invest an equivalent of about R11-billion in the auto company's southern Italian factory to produce two new SUV's for global export.

The automaker hopes the investment will revive its severely under-used plant in its home country where new car registrations are down 20% in 2012 year. The European Union as a whole is down only 7%.

ECONOMIC CRISIS

Italian prime minister Mario Monti, who joined Marchionne at the Melfi plant in the Basilicata region for the announcement, said: "It seems Italy knows how to roll up its sleeves, despite the evident difficulties, and knows how to look with renewed trust toward the future.”

Marchionne said the plan to build a pair of small SUV’s - one a new, smaller Jeep for global sale, the other in the expanding family of Fiat 500-based vehicles - would help the automaker staunch losses in Europe and address the under-use of its Italian plants caused by the economic crisis.

Fiat said the Melfi factory would be modernised to reach a daily capacity of 1600 vehicles from 2014 - and the factory could eventually produce four distinct models on its.

The auto-maker's factories in Italy have been running at about half-capacity. The Melfi plant, which makes the Punto compact car, closed for about 150 days during 2012, sending its 5500 workers home with reduced pay.

Under a business plan announced in October 2012, Fiat is shifting its focus in Italy to the export market with an emphasis on higher-profit luxury models. The auto-maker owns the Alfa Romeo, Maserati and Ferrari brands and plans to launch two new Maseratis - the next generation of the Quattroporte sedan and the smaller Ghibli - and a new Alfa, the 4C sportscar, in 2013.

Marchionne said the tie-up with Chrysler had given Fiat access to premium car technology needed to expand its model ranges and access to global markets, notably North America and Asia, where Fiat is lagging.

Its plans also include expanding its family of Fiat 500 models based on the update of the iconic city car launched in 2007. Fiat three months ago began selling the larger version, the 500L, built in Serbia.

Marchionne said Fiat's investment plan to launch the production of 17 new cars and seven updated models in Italy by 2016 demonstrates "the sense of responsibility Fiat feels towards the country".
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Read more on:    italy  |  fiat  |  suv  |  jeep  |  sergio marchionne

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