23.07.2010 BERLUSCONI EXPRESSES CONCERN AS ANGER GROWS OVER SERBIA PRODUCTION SWITCH PLANS

LANCIA MUSA

Italian Premier Silvio Berlusconi said he hoped Fiat's new production plans do not come with a high cost for the nation after the carmaker decided to shift production of a new model to Serbia, causing a major stir, reports the ANSA news agency.

Fiat said Wednesday that a new vehicle that will replace its Multipla and Lancia Musa models, the L0, will be made in Serbia and not, as had been expected, at the Mirafiori factory in its home city Turin. The move comes after Fiat CEO Sergio Marchionne said a plan agreed last year to increase the group's production in Italy will be slowed following tensions with the FIOM trade union, which is linked to the nation's biggest union CGIL.

''In a free economy, an industrial group is free to place production where it is most suitable,'' Berlusconi told a press conference after a meeting with Russian President Dmitry Medvedev. ''However, I hope that this does not take place at the expense of Italy and of the (Italian) workers Fiat employs''. Earlier on Friday the government warned Fiat not to make such decisions without consulting labour leaders.
 
''We call on Marchionne not to act unilaterally, but to have talks with the unions,'' Labour Minister Maurizio Sacconi said. ''Marchionne said he was ready to invest in Italian plants and increase their capacity to the degree in which he had normal, non-conflictual industrial relations, without wildcat strikes and hold-ups from individual workers.

''These issues must be taken back to the negotiating table to encourage investments, and not provide alibis for making different choices''. FIOM irked Fiat by opposing a flexible working practices deal designed to boost productivity that the company proposed at the Pomigliano d'Arco plant near Naples in exchange for a pledge to invest 700 million euros to make Panda cars there. FIOM claimed the accord is against the Italian constitutional because it infringes on workers' right to strike. In the end Fiat decided to press ahead with the programme this month after other unions agreed to it, despite being disappointed that only around 62% of Pomigliano workers supported it in a vote.

CGIL has described the decision to make the L0 in Serbia as part of Fiat's strategy of allegedly bullying its Italian workers into accepting whatever conditions it offers them. FIOM ordered a two-hour strike by its members at Fiat's Italian plants Friday to protest at the recent sacking of five workers at different factories, dismissals which unions have also described as intimidatory. Administrative Simplification Minister Roberto Calderoli, meanwhile, described the L0 move as ''outrageous'' Thursday. ''You cannot turn up at the dinner table, eat thanks to government incentives to buy cars and state aid, and then take off without even paying the bill,'' Calderoli said.

The decision to shift the new model's production to Serbia also caused dismay among opposition parties. Pier Luigi Bersani, who heads Italy's largest centre-left opposition group, the Democratic Party (PD), said Friday that rather than calling for negotiations, the government should directly summon Fiat and the unions to talks. However, Turin Mayor Sergio Chiamparino, a PD member, said he was confident the Mirafiori plant's future was not in danger after speaking to Marchionne on the telephone. ''I asked Marchionne if it was possible to tackle the issue of Mirafiori and it seemed to me that there was great willingness on his part and a desire not to prejudice the T in Fiat,'' Chiamparino said. Fiat is an acronym for Fabbrica Italiana Automobili Torino - Italian Automobile Factory of Turin. Chiamparino also called on trade unions to do their bit with a ''turning point in reliability''.

Fiat also came under heavy fire from unions and politicians last year when it announced plans to shut down its Termini Imerese plant in Sicily. The company's share price rose over 6 percent Wednesday when it announced better-than-expected profit figures for the second quarter and confirmed plans to spin off its auto businesses from other parts of the group.
 
Report courtesy of ANSA
 

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