Fiat SpA is to instigate temporary lay-offs at its Termini Imerese plant in Sicily, a media report said.

The lay-offs would occur from 22 July to 2 August, Reuters cited a source close to the company as saying .

Earlier this month, Fiat said it would stop making the Lancia Ypsilon at its Termini Imerese plant from 2011.

The plant which is the smallest of Fiat's five in Italy, employs 1,400 and would be kept going, though, with production switched away from cars, CEO Sergio Marchionne told Italian government and union officials.