Fiat Group CEO Sergio Marchionne appears to have won his hard-fought battle to close Termini Imerese with an Italian government minister being quoted yesterday as saying that alternatives uses for the plant were now being looked at once production of the current-generation Lancia Ypsilon (above) runs out in a year's time.

Fiat Group CEO Sergio Marchionne appears to have won his hard-fought battle to close Termini Imerese with an Italian government minister being quoted yesterday as saying that alternatives uses for the plant were now being looked at once production of the current-generation Lancia Ypsilon runs out in a year's time. In a tough recent battle of words Marchionne has been pitted against regional and national government, the carmaker's unions which called a nationwide strike last week, and other figures including Pope Benedict XVI.

Fiat is no longer interested in Termini Imerese," Economy Minister Claudio Scajola said yesterday in and interview with Canale 5. "We have a year and a half before Fiat stops its production in Termini." For Scajola it represents a major climb down, previously he had opposed Fiat's plans to end production at the factory, calling the decision "crazy".

Fiat's unions have tried to link the continuation of government 'eco' incentives, due to run out next month, to Termini Imerese's future, but last week Marchionne in a statement said he would accept the removal of these state subsidies. The Pope weighed into the matter a week last Sunday calling for job protection in a region where unemployment is high and the factory provides a real lifeline. Before Christmas in a speech in Rome Marchionne broke the link forged when the Agnelli family were in control that saw Fiat closely tied to social responsibility. In his speech Marchionne argued that Fiat wouldn't be held socially responsible for workers at the plant. Marchionne also stated last Friday that around half the workforce could be liable to early retirement.

Scajola said at the weekend that up to 10 proposals for the beleaguered plant had been received. That is up from seven proposals that he said had been received on January 29. The minister said that the government will choose the bid that supports the retention of most jobs. Currently around 3,000 jobs are directly or indirectly created by the factory which previously built Fiat's Grande Punto, the first-generation Panda, and the 126.

The current front-running expression of interest, and the only one to be made public so far, is that of Sicilian investor Simone Cimino, the Chairman of Cimino & Associates Private Equity, who hopes to build an electric car under licence from Bangalore, India-based Reva Electric Car Co. at the factory. He is targeting building 30,000 units a year to reach break-even. Cimino told Financial Times today that he needs a minimum of 65 million euros to kick the project off and has so far secured 50 million euros from regional government sources and French bank Naxtis. Investment could eventually top 900 million euros. According to FT he will modernise the factory, retain Fiat's workforce, and sell the electric cars for 16,000-17,000 euros, in particular to be used by tourists on the island.