Fiat SpA Chief Executive Officer Sergio Marchionne may shut down the carmaker's Pomigliano d'Arco plant near Naples if unions don't agree to more flexible work practices.
Unions representing Fiat workers will meet with company officials in Rome later today to respond to proposals to add shifts and reduce absenteeism at the factory. "Time is short," Marchionne told reporters at a conference in Venice today. "Let's hope for an agreement as soon as possible."
Fiat says it's prepared to shift production of its best- selling Panda model from a factory in Poland to Pomigliano and invest 700 million euros ($849 million) to improve the plant if unions agree to a plan that includes adding shifts and instituting a six-day work-week. Unions are balking at some of the terms, including a clause they say limits their constitutional right to strike.
"There is concern that the situation at Pomigliano will spark widespread strikes and work stoppages," said Massimo Vecchio, an automotive analyst at Mediobanca SpA in Milan who has an "outperform" rating on the stock. "Fiat's requests seem reasonable if they want to increase productivity at the plant, which is one of their least efficient."
Pomigliano employs 5,000 workers and produced 35,000 cars last year. Marchionne's plan to boost productivity calls for the plant to increase production to as many as 280,000 vehicles a year, including the Panda.
Alfa Brand
Pomigliano, which is one of five Fiat factories in Italy, also produces models for the company's Alfa Romeo brand. Marchionne has already said he'll cease auto production at the Termini Imerese plant in Sicily after 2011. The Italian government has set up a task force to review offers to buy the factory and preserve jobs.
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