Italian government says Italian Fiat closures not an option
19 May 2009

The threat of job losses in the UK intensified today, after the Italian government told Fiat it must keep all five of its domestic plants open.

Fiat is hoping to merge with the European operations of General Motors to become the second-largest car maker in the world.

But a sale could mean an overlap in manufacturing, which would be exacerbated by a decline in car sales.

Reports suggest Fiat will be looking to make large job cuts if the deal with Vauxhall/Opel goes ahead, and it is feared that GM plants like Ellesmere Port in Cheshire would be among the first to be cut.

Italian industry minister Claudio Scajola said today at a financial conference in Rome: “For the government, the maintenance of the five plants in Italy is not negotiable."

It is believed that German government officials have told Fiat that one of the conditions of an Opel sale will be that no German factories are shut down.

There is also immense pressure from Fiat workers in Italy not to axe any jobs at home, with thousands marching the streets last weekend in Turin to voice their concerns.

Meanwhile, Fiat CEO Sergio Marchionne has reportedly said his company’s offer for Opel won’t be in cash because the assets he’s offering are worth much more.

In an interview with Bloomberg News today in Frankfurt he said he hasn’t yet submitted a proposal on Opel. The German government has set a deadline of tomorrow for bids for the manufacturer.

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