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Fiat will suspend Panda production at Pomigliano Italy plant as demand falls

Fiat will suspend Panda production at Pomigliano Italy plant as demand falls

Fiat will temporarily suspend production at its Pomigliano plant in southern Italy from Oct. 16-27 amid weak demand. The Fiat Panda minicar is built at the factory.

The measure is “necessary because of the slowdown in the market in view of the end of the year,” said Giuseppe Terracciano, secretary general for the Fim-Cisl union in Naples. Fiat confirmed the temporary suspension, but declined to give any further comment.

Fiat often uses the state-backed temporary layoff schemes to avoid over-production by keeping workers at home when market demand is lower. Some 1,950 of the plant’s 4,500 workers have already been on so-called solidarity contracts since March, under which they agree to work less and are also paid less in exchange for workers retaining their jobs.

Fiat’s Italian plants have been under-utilized for years, especially after the auto market in Europe was hit by a six-year slump in sales and is only gradually recovering.

However, Fiat has promised it would reinstate all workers currently on the various layoff schemes as it executes an ambitious five-year investment plan, under which it expects to boost global group sales by 60 percent to 7 million cars and increase net profit five-fold by 2018.