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Sunday October 26, 2008

Temporary halt for Fiat’s factory in North America


Fiat froze its investment project in North American until mid next year. Based on sources from Corriere Canadese/Tandem, the “freezing” was already made public to the various North American executives who are interested in this investment, including the provincial government of Ontario.
The famous car manufacturing company and its renowned president and delegated administrator, Sergio Maricchione, has, on several occasions stated that he intends to invest in North America and to build an establishment for the manufacturing of Alfa Romeo. The latter is not only directed to the American market, but also to the markets in Canada, South America, and Europe itself.
Certain U.S. states like Georgia and Ohio, are strongly interested, and are in the running for this investment. Mexico and Canada propose numerous incentives.
In Canada’s case, Fiat has decided that Ontario will be the province to host this important establishment.
Fiat’s decision to “freeze” the investment, is by no means tied to the details of the project itself, but to the international economic situation, especially that of the troubled automobile sector.
Fiat examined the possibility of the landing of new establishments in various areas in North America, between Canada, the U.S., and Mexico, but seems that before the “freezing” decision, Ontario was on that list alongside two other localities.
Still according, to unofficial sources, it seems that the project underwent some changes when Fiat’s interest in Ontario was no longer tied to the construction of Alfa Romeo.
The final decision, however, is also linked to other very important aspects, such as the ability to distribute the product to the consumer.
To encourage Fiat’s investment in Ontario, a number of government delegations went to Turin for a discussion with the executives of Lingotto. Last summer, Ontario Premier Dalton McGuinty visited Mirafiori and explained the advantages that Fiat could bring when opening a factory in this province.

Ontario, therefore, made financial concessions of about $300 million. The original plan of Fiat was to go back to North America to build a new Alfa Romeo to enter the market and to increase the competition between other sporty cars such as BMW and Audi.
Fiat spoke of a new product of which, after reaching full activity levels in the new location, 2,000 examples will be manufactured per year.
The initiative also foresees an investment of €1 billion, over $1.6 billion, and predicts the creation of 2,000 new jobs upon completion of the project. Ontario remains hopeful, but at least for now, everything is “frozen” until the beginning of next summer.