Fiat has pledged EUR1bn of investment at its hometown Mirafiori plant in northern Italy as it pushes forward with plans to boost sales of its luxury model line and bring its loss making European business back to profit.
Reuters said the move was a turning point for some 5,500 laid-off Mirafiori workers in Turin who have waited for three years for promised spending at the plant, and signals the carmaker’s commitment to continue manufacturing in Italy.
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“We’re very happy with this decision,” Flavia Aiello, UILM union representative at Mirafiori, told the news agency. “We had some very strong worries about the future of the plant.”
In a statement following a meeting with labour unions, Fiat said it would launch investment at Mirafiori immediately to ensure the plant’s future.
A union leader, who was at the meeting with chief executive Sergio Marchionne, said Fiat had agreed to invest just under EUR1bn by the end of next year at Mirafiori to begin producing a Maserati SUV.
A company spokesman said more details would be provided later in the month.
Fiat said in February it would build Maserati and Alfa Romeo models at the plant.
But unions had grown increasingly concerned that Fiat might delay investment as mass market carmakers in Europe struggle through the sixth year of a contracting market.
The fate of Mirafiori is closely watched by Italian unions and politicians worried that Fiat could shift production to the United States.
Fiat’s five Italian car factories run at well under their total capacity but, unlike its competitors, the carmaker has decided not to close plants.
Mirafiori, one of Europe’s largest factories with a capacity to build around 300,000 units per year, has been running for only about three days a month since April 2012. It built just 62,594 cars in 2011.
Fiat said on Wednesday it would seek an extension of the lay-off scheme at Mirafiori because it needs more time to retool the plant.
According to minutes from the meeting, Marchionne, who is also head of Chrysler, confirmed the group would press ahead with promised investments at the Cassino factory, where new Alfa Romeos are expected to be built.
The company also confirmed it would create a single luxury-car unit combining its Mirafiori and Grugliasco plants, Reuters added.
