An Italian union says 700 jobs could go at Fiat's former Sicilian plant at Termini Imerese as the factory transfers to new ownership.

The site is being acquired by DR Motor but the FIOM trade union says around 700 metalworker and other posts could disappear as part of the deal, that it adds will see Fiat stop production next week.

FIOM's comments come against a backdrop of intense economic uncertainty in Italy as the new and unelected Prime Minister Mario Monti forms a government and the country grapples with its eye-watering debt, thought to be in the region of EUR1.9tn (US$2.6tn).

"The workers hope to be in this DR [Motor] company from the beginning of next year," a FIOM spokesman in Italy told just-auto. "[There are] more or less 1,300 workers - this means that 700 who are now working within the Fiat plant as metalworkers or other jobs will have no future in Termini Imerese.

"The unions asked Fiat to pay a bonus for each of these workers who will be put into Cassa Integrazione [redundancy insurance]. It has happened in the past for other workers, but they say the workers are too many...and this will be too expensive for them."

Fiat in Turin confirmed to just-auto from Turin that 700 jobs would go at the Termini Imerese plant from a total of 2,200 posts. It was unable to comment on FIOM's Cassa Integrazione view.

FIOM is due to hold a meeting in Naples today (18 November) at which it will discuss the economic situation in southern Italy. The south has traditionally been a relatively poorer region than its northern neighbour, with Italy's current financial malaise potentially exacerbating the situation.

DR Motor was not available for comment.