Automotive News

Fiat SpA may have to close factories in Italy, given sharp falls in auto sales which have changed the sector dramatically, Chief Executive Sergio Marchionne said on Friday.

Keeping all the factories open "is a request that is not feasible," Marchionne, who is also head of U.S. car maker Chrysler, told reporters at an event.

"The world has changed profoundly. We cannot go back to a reality that doesn't exist anymore," he said.

The global car industry has been rocked by plunging sales as consumers rein in spending because of tighter credit.

Fiat has already said it plans to stop car production at its Termini Imerese plant in Sicily but so far has said it will still use the facility for other manufacturing.

Marchionne will announce Fiat's latest strategy in the first quarter of next year and will meet Prime Minister Silvio Berlusconi on Dec. 21 to inform him of the plans.

He has said frequently European car production needs rationalising as has already happened in the United States.

He said on Friday that the market for new cars in Italy during November had performed as expected. Sales in October were up 15.69 percent on a year earlier and Fiat's sales rose 15.1 percent, giving it a 32.6 percent share.