Fiat in Serbia, what will the future bring?

Fiat 500 Sport Serbia

Fiat 500 Sport © by EdoM Photography

A national news program gave the news a few days ago that Italian companies are investing in Serbia where Italy will be the third largest partner behind Russia and Germany but with the goal, on the part of the Italian government, of earning the second spot if not even the first.

Regarding Fiat and its future, we wonder about the status of the work being done on the new factory planned for Serbia, where Fiat was foresaw the production of 250,000 units per year of the new models called L0 and L1, compact vans which will replace the Lancia Musa and Fiat Idea starting in 2012.

In order to build this new factory, Fiat had requested further financing from the Serb government which seems to have refused the new request to further support the Turin company.

As early as March, news had been leaked and reported on various websites, that Fiat was pulling out of Serbia, which had also led to the unexpected resignation of the Serb Vice President, Mladjan Dinkic.

Besides this, it seems that Fiat’s suppliers are refusing to invest in Serbia, constructing production units near the factory that will only serve the FGA factory; the operation is inconvenient and very risky because the Suppliers would be dependent only on FIAT’s choices.

It must also be remembered that Serbia was a company plagued by war and much of the land where new factories would be built has not yet been inspected and cleared of explosives (including mines); the operation would take a long time and be impossible to achieve in order to supply production lines by 2012.

So, what are FIAT’s future plans for the factory that was meant to be built in Serbia?
If, as it seems, FIAT, which has already received adequate financing from the Serb government (we’re talking about figures of around 900 million Euros in investment, 600 of which are from Serbia) decides not to go forward with the set up of the new production line due to the refusal of new financing from the Serb government, it would be logical to consider repayment of the funds received. Where would the production of new compact vans move to? Maybe to Mirafiori which seems to be the only plant to be maintained in Italy according to the FGA leadership?

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