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Electrolux 'has no intention of leaving Italy'

'But high labor costs must be addressed' says manufacturer

04 February, 16:25
Electrolux 'has no intention of leaving Italy' (ANSA) - Rome, February 4 - Electrical-appliance multinational Electrolux said Tuesday it had no intention of leaving Italy after announcing last week a shock wage-cut plan it said was necessary to keep its Italian plants running.

"We want to stay in Italy. We have no intention of leaving," the CEO of its Italy division, Ernesto Ferrario, told a hearing before the Senate industry committee. He underlined however that the Swedish company "wants to be sure about the competitive base". The plan to slash wages towards standards more common in Poland has outraged labor unions and sparked government meetings with company managers and owners. Premier Enrico Letta said Thursday the government must cut labor costs if it wants to keep major manufactures from fleeing.

Electrolux plans to cut wages in Italy by three euros an hour, which it said was an 8% cut and would amount to a reduction of less than 130 euros a month in workers' net salaries. The company says it has also proposed freezing salary increases due to seniority and other raises linked to the sector's national collective contract for three years in order to "cool the inflation of labour costs, which is responsible for the continuing growth in the competitive gap with the countries of Eastern Europe". Electrolux says it is willing to consider "other forms of reducing labour costs with lower or, if possible, no consequences on salaries".

"We need help reducing the cost of labor in Italy," Ferrario told the Senate committee. "We don't want to arrive at the cost of labor in Poland or Romania, (but we must do something about) this constant hike". The CEO said his company expected a response from the Italian government by April in order for it to make long-term investments in the country. "If we don't get any information, we can't make a five-year industrial plan. It will have to be for one year," he said, specifying they would announce a new plan the following year if such is the case.