Alfa Romeo production set to stay in Italy
Chrysler IPO filing ready this week16 September, 18:35
The head of the parent company for both premium Italian car brands explained that the luxury goods cache' of being made in Italy is too important for both.
"There is not a doubt in my mind that the origin of production is important to Maserati. I also think it's important for Alfa," Marchionne told the Financial Times. "We will never build outside (Italy)...It may well be the next CEO that makes that call (to build elsewhere). But it's not me," Marchionne said. In July Marchionne threatened to have new Alfa Romeo models produced outside Italy as he complained about industrial relations in Italy, amid a bitter row with left-wing union FIOM, which opposes the carmaker's drive to introduce more flexible work practises at Fiat's Italian plants.
The Fiat Group on September 4 announced a deal with unions to invest just under one billion euros to retool the loss-making Mirafiori plant to produce a Maserati SUV and another unnamed model there. The plans are part of Fiat's strategy to focus Italian manufacturing on premium cars, and follow investment in another plant near Turin to make Maserati Quattroporte and Ghibli models.
Marchionne said Fiat Group's plan to retool Mirafiori means all workers currently on leave due to production cuts will be reabsorbed. "The plan that we have in place in terms of the full development of the site...is that all the people employed at the plant will be absorbed," Marchionne said. The FT reported that the Mirafiori plant is currently operating at roughly one tenth of the plant's 300,000-car-per-year capacity, with over 5,000 furloughed. Marchionne confirmed to the FT that the carmaker also planned to produce another, unnamed model at Mirafiori in addition to Maserati SUV to optimize production. "(The investment) buys a full assembly-line and a brand new product that will compliment the Maserati line-up. I think it is in desperate need of an SUV," Marchionne told the FT. Marchionne explained that the investments were already being lined up for the plant and car surfaces designed for the new model.
"(Mirafiori) starts making the body in the third quarter of 2014 and the idea is to enter the market in the second quarter of 2015," Marchionne said.
Meanwhile, sister carmaker Chrysler is planning to file the documents for its initial public offering (IPO) this week, Marchionne said in an interview published Monday. "All the work, all the preparation, drafts have gone through...we should be ready to file (IPO documents) within the third week of this month," Marchionne, who is also the CEO of Chrysler, told the Financial Times. The IPO comes after the Fiat Group and the VEBA healthcare trust, which owns the 41.5% of the US automaker that does not belong to Fiat, failed to agree to a price on VEBA's stake in a long running dispute.
"We need to go through this process of determining value," Marchionne told the FT. "(The trust) have been very clear that they are not long-term holders of the assets. They want to monetise, so we need to find a way for them to exit in a way that...does not create what I consider to be exceptionally high or abnormal expectations of value. The market will tell us. Let the market talk".