Unions seek solidarity

Bloomberg

Fiat’s Italian workers, who may lose their jobs as Chief Executive Officer Sergio Marchionne attempts to buy General Motors assets in Europe, are turning to an unlikely corner for support: German unions.

Marchionne pledged to try to save German jobs as he seeks approval from the government to buy GM’s Opel unit, leading the Italians to deduce that cost savings from a merger would come from plant closures at home instead.

Italian unions met yesterday with IG Metall, Germany’s largest union, to press the Germans to share the burden.If Marchionne completes a three-way alliance with Chrysler and GM’s European operations, Italian plants in San Giorgio Canavese and Sicily’s Termini Imerese, with a combined workforce of about 1,700, are among six factories in Europe that may be shuttered, a person familiar with the matter said.

Germany, Austria, Poland and the U.K. may also have closures as part of a plan to save 1.4 billion euros ($1.9 billion), the person said."Italy can’t pay for Marchionne’s plan to create an auto giant worldwide," said Enzo Masini, who represented the Fiom-Cgil union at yesterday’s gathering at IG Metall’s headquarters in Frankfurt.

"In Italy, Fiat is the only automaker so there’s no chance of finding another job for a redundant worker."Turin-based Fiat, the country’s largest private employer, runs five auto plants in Italy, with 31,000 staff. Opel, which competes with Volkswagen and Bayerische Motoren Werke in Germany, employs 25,000 workers at four factories.

Under Fiat’s proposal, Opel may shut an engine production unit, affecting 1,100 people in Kasiserslautern, Kurt Beck, prime minister of the state of Rhineland-Palatinate, said last week.

Labor delegations meet
Klaus Franz, Opel’s top labor leader, yesterday led a delegation including representatives from other European factories, according to an IG Metall spokeswoman.

Italian Industry Minister Claudio Scajola, under pressure from local unions to step in, asked Fiat on May 8 to meet with worker representatives and the government as soon as possible, urging the safeguarding of car plants. Marchionne has said that the five Italian factories together produce the equivalent of the capacity of Fiat’s Poland plant in Tychy.

Fiat unions in Italy have said any plant closure would spark a "heavy social conflict" and workers have held strikes this week at two factories, including in Termini Imerese nearPalermo.

Protest against employers
The unions will hold a national protest outside Fiat’s headquarters in Turin on May 16.

The plan, dubbed "Project Phoenix" and presented to Germany Economy Minister Karl-Theodor zu Guttenberg on May 4, also includes a reduction in production at the Pomigliano d’Arco plant, which employs 5,000 workers, the person said. German workers at Opel, based in Ruesselsheim near Frankfurt, have held back on an agreement to trim labor costs to avoid accepting an investor they don’t want, including Fiat.

IG Metall’s Armin Schild said April 27 that he opposes Fiat as a partner and called German officials’ handling of the search for an Opel stake-buyer "unprofessional" and motivated by federal elections in September.

Fiat hasn’t made a decision on whether to close any Opel facilities, German state prime minister Beck said May 8 after meeting Marchionne."We have asked Fiat to have a business plan for Italy for months," Vincenzo Comella, a regional leader of the Uilm union, said in an interview.

"They told us we had to wait for the end of the crisis. Now Marchionne is showing business plans all around the world, except to Fiat workers.

"The Pomigliano factory produces Alfa Romeo 159 and Alfa 147 models. Termini Imerese manufactures Lancia Ypsilon cars, with 1,400 staff. The plant received European Union approval in April for state aid to fund the production of a new model, which Fiat has delayed to next year.

Fiat has idled the Sicilian plant for five months in the past eight months as it halved production to counter falling demand, using a state-subsidized layoff program. Marchionne said in a May 6 interview in Detroit that Fiat "would need to reduce the number of plants that could potentially be closed by making them more efficient." Job cuts are certain as volumes don’t support current headcount, the CEO said, declining to be more specific.