Fiat is looking at adding output of US-bound cars at idled Italian factories as a way of boosting exports, possibly with government help, a media report said. Meanwhile, CEO Sergio Marchionne again has dismissed talk of selling Alfa Romeo to Volkswagen.

As reported earlier on just-auto, Marchionne, who also runs majority-owned Chrysler, met Italian prime minister Mario Monti on Saturday to discuss how Fiat can keep its factories open at a time when car sales have plunged to their lowest level in 40 years. Fiat reiterated its commitment to an industrial presence in Italy, underpinned by a strategy to increase exports beyond Europe. The Italian industry ministry will also set up a working group to help with the export push.

“Financial aid was not asked for, and had it been requested it would not have been given,” Monti said in Rome on Monday.

“We may introduce mechanisms for Fiat and for the entire manufacturing sector, destined to make exports easier either in fiscal terms or otherwise,” industry minister Corrado Passera, who attended the meeting with Marchionne, told Reuters.

Meanwhile, an unnamed source told the news agency Fiat would use loss-making Italian factories to produce cars to sell in the United States, where the market is growing and Chrysler’s factories are already running at full capacity. The Fiat 500 currently sold there is made in Mexico.

Italian factories could make Jeep and Chrysler models, the source said.

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Fiat will no longer release a detailed strategy on products and plants on 30 October as previously planned, two sources close to the matter told Reuters. Fiat declined to comment to the news agency.

Meanwhile, Marchionne reiterated the company’s targets on Monday at an industry conference in Turin where he reportedly said he did not see the European car market recovering until at least 2015.

“The European car market is a disaster. It has plunged off a precipice that doesn’t seem to have bottomed out yet. The prospects are anything but rosy,” Reuters quoted Marchionne as saying.

Reuters noted that the combined Fiat-Chrysler group, which now makes more than two thirds of its profits in the United States, had so far only earmarked a fraction of the EUR16bn (US$21bn) of new investments in Italy which Marchionne outlined in a five-year plan in 2010.

It promised the investments in return for greater labour flexibility. New labour contracts are now in place at its plants but in the meanwhile Fiat has shifted some production to lower cost countries and put investments in Italy on hold, the report added.

“We are none the wiser after the meeting with the government,” Giorgio Airaudo of the FIOM union told Reuters. “It’s all very well to say we’ll make cars to export, but until they say which models and how many cars we are back to square one.”

Marchionne has said he would not waste money by making investments during a five-year European market slump. Fiat will lose EUR700m in Europe in 2012, he said last week.

“We are facing a crossroad, the choice is between reducing output capacity and firing thousands of employees … or trying to use our skills, our knowledge of products and processes, the technology of our plants, to make inroads in foreign markets,” he told an industry conference on Monday.

“It remains our view that fixing Fiat’s European business will be tough to achieve without a significant reduction in capacity,” Deutsche Bank said in a note to investors after the weekend meeting between Monti and Marchionne.

Italian broker Banca Akros also said it was unclear how Fiat could increase exports from Italy in the short term if it delayed investment, Reuters reported.

Also on Monday, Marchionne said he would welcome Volkswagen as a producer in Italy but added it was silly to think that foreign car makers could rescue Italy’s troubled automotive industry.

“I welcome Volkswagen as a producer, and I’ll do everything possible to help them,” Marchionne told an industry conference.

“The fact of looking to foreigners as if they were Italy’s saviours is the biggest pile of c**p I have ever heard,” he added, according to Reuters which noted he was referring to recent calls from trade unions that the Italian government should be more aggressive in courting foreign investment in the country’s auto sector. Europe’s car market is in its fifth year of shrinking sales.

He also reiterated that he had no intention of selling Alfa Romeo to the German competitor.

Reuters said there had been press reports saying Volkswagen had visited Italian Alfa Romeo factories.

Fiat is gearing up to introduce a raft of new Alfa models and is expected to show the new 4C sports car at the Detroit show next January.

Speaking to Reuters on the sidelines on an industry event, Marchionne confirmed a previously-announced 2012 targets. He said revenues were seen above EUR77bn and net profit between EUR1.2bn and EUR1.5bn for the full year.

Fiat is due to announce third quarter results on 30 October.