Fiat Denies Some 18,000 Jobs Are at Risk

Italian carmaker would cut some 18,000 jobs and 10 assembly and component sites at a combined Fiat/Opel company including both Vauxhall plants in England and two Fiat factories in Italy, a German newspaper reported.

AP Fiat's 2007 Nuova 500 car.

However, Fiat denied the report in the Frankfurter Allgemeine Zeitung, which said that all 10 would be shut down between 2011 and 2016, citing a 103-page internal Fiat strategy plan dated April 3.

The plan was written in English and dubbed "Project Football." The report is in an advance copy of the newspaper's Wednesday issue. Fiat issued a statement saying the information in the report "does not come from Fiat and is not part of any plan prepared by the company."

The closures should eventually lead to additional free cash flow of about 4.3 billion euros ($5.76 billion) by 2015, the newspaper said.

Fiat Chief Executive Sergio Marchionne met German officials on Monday to discuss an offer for Opel, the German unit of General Motors . Italian Prime Minister Silvio Berlusconi said on Tuesday he was confident a deal with Opel would go ahead.

"All the information I have is that there is great interest in this operation, which would be almost a dream for all Italians," he said in a television interview.

Fiat would shut down Opel car manufacturing plants in Luton and Ellesmere Port in England, home of its sister brand Vauxhall, the newspaper report said. The plant at Antwerp, Belgium, would be the first to go in 2011.

Among Opel component sites, some or all of the engine and transmission production in Germany's Kaiserslautern, Ruesselsheim and Bochum plants would be closed. Austria's Aspern
would also be shut down.

In Italy, Marchionne would shut Fiat's Pomigliano plant where most Alfa Romeos are built along with Termini Imerese in Sicily, which manufactures Lancia Ypsilons. Closing the five carmaking sites would cost upfront 1 billion euros ($1.34 billion) but reap 282 million euros in annual savings. The five component factories would bring in another 200 million euros in savings every year.

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The paper reports Fiat wants to gain access on the cheap to GM's platforms on which it builds the Opel Corsa subcompact, the Astra compact and Insignia mid-size car. A further key aspect of the plan is acquiring GM's Latin America operations.

According to sources on the Opel supervisory board, Marchionne also plans to put an end to GM's Saab brand and its own Lancia brand over the longer term.

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