I went to the Zastava factory in Kragujevac, Serbia, earlier this year, and to say it was a depressing place would be a major understatement.

_DSC4087 It was still winter at the time, and on the factory floor workers spent their breaks crammed into small huts, trying to keep warm among Arctic drafts and a leaking roof.

The one-time computing centre sat in ruins, destroyed by a NATO bomb in 1999. And, around the back of the plant, lines of mothballed railway wagons showed how far Zastava’s fortunes had fallen – the factory no longer made enough cars to justify sending them out by train.

I’ve only been to one other place that gave off such gloomy post-industrial vibes: the abandoned zone around the Chernobyl nuclear reactor.

But I left Kragujevac convinced that Zastava deserved to thrive and develop. Pretty much every other country in Eastern Europe is now the home to gleaming new car factories, yet Zastava was making cars in Serbia before any of them. And, despite the dilapidated offices, the company has some serious brains on the payroll, too – guys who have worked out how to re-engineer and refresh its ancient line-up on the sort of shoestring budgets that wouldn’t pay to develop a 3-Series glovebox catch.

The factory had also just started to make previous generation Fiat Puntos under licence, with gleaming, state-of-the-art machinery standing in stark contrast to the Dickensian gloom of the rest of the plant. It was a big clue to the company’s future, because now Fiat has just finished purchasing a controlling stake.

With a workforce that already knows how to make cars, plenty of onsite engineering expertise and a vast site that could incorporate even the most optimistic expansion plans, I predict a bright future for the Serbian motor industry.