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17

Fiat To Provoke Social Tragedy

Fiat is plans to lay off 8,100 workers...

Fiat is plans to lay off 8,100 workers at its ailing automobile and components divisions.Although as Fiat promises many of the workers will be rehired if new models lead to improved car sales.

The lay-offs will require government approval, since Fiat is seeking to tap an industry-funded scheme administered by the state that pays laid-off workers a fraction of their wages for up to one year. After that, Fiat is obliged to rehire them, although the company is lobbying for new government schemes that could retrain workers. Fiat also is seeking early retirement for 500 of the 8,100 employees.

The most sensitive cuts will be at Termini Imerese (plant near Palermo) as all 1,800 workers will be laid off until sales of the subcompact Fiat Punto begin to increase.

Fiat plans to launch a restyled Punto in mid-2003, but most of its new models will not arrive until 2004 and 2005.These sharp changes may lead to a social tragedy with dramatic repercussions.