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While the Kragujevac “Fiat” workers are again on paid holidays and more at home than in the hallways, the “Fiat Chrysler Automobiles” group announced last week that they modernized their larger “Mirafjori” factory near Turin and started produce the electric model “she”. panda 500 “. Just over a month ago, Pietro Gorlije, the group’s executive director, sent a letter to the employees in which he told them that after Italy, it was the turn of the development of the factories in Poland, then in Serbia and Turkey.
Sasa Djordjevic, president of the Independent Union FAC, tells “Politika” that the workers are currently on paid leave and will return to the factory plants on November 3. The number of days it will work depends on the order. For each vehicle that is in production, it is known exactly which customer it is targeting, which market and which country. There are no cars in stock. Djordjevic says that for now they are working according to the employer’s plan and that at this time no one can say for sure how many working days they will have by the end of the year because it all depends on how many cars are ordered.
Djordjevic emphasizes that there has been a big drop in demand in the world market and the entire auto industry has a similar problem with product placement. In his opinion, the only real thing for the survival of the Kragujevac factory is the new model.
When asked if the management has an announcement about a new car model for Serbia, Djordjevic says they have nothing concrete for now.
– I am deeply convinced that this will also happen. The letter from Pietro Gorlije, the CEO, where our factory in Serbia is officially mentioned for the first time in a document, gives me hope that something positive will happen for us in the coming period. That letter seems serious. So far we have had several stories, most of them in the newspapers. This is the official position of the company and I believe them. They announced that in the next period they will start a more serious story in Poland, then in Serbia. It is not for a limited time, but it is something that awaits us in the next period – says Djordjevic.
Our interlocutor underlines that it must be taken into account that the merger with “Peugeot” is underway. It assumes that only after the merger of the two companies is completed, which will become the world’s fourth largest car production company, there will be a more serious story about the new model.
Ljubodrag Savić, a professor at the Faculty of Economics, believes that “Fiat” does not currently have any strategy when it comes to Serbia. Unfortunately, the situation with this company, he says, is pretty bad. A few years ago, the Kragujevac factory reached peak production of about 117,000 cars in Serbia, he recalls, after which they fared worse and worse.
– The ten-year contract between “Fiat” and the Government of Serbia expired last year. We have not been informed if it has been extended, if a new one has been signed and what are the conditions for further cooperation. In any case, I have the impression that the state does not know what to do with “Fiat”, and “Fiat” does not know what to do with Serbia. “Fiat” only works when it has secure car sales, which is a characteristic of capitalist countries. They don’t want to camp on the plot. But the problem is that it is at the level of 20,000 to 30,000 cars a year, says Savić.
The fixed costs are huge and the factory is working on one sixth or even one seventh of projected output. Fiat has some reasons not to leave, but the problem for Professor Savić is that Serbia has certain costs and obligations.
– I do not see a good solution for Serbia in terms of starting production. Every day, the state loses, and workers who receive 60 percent of their wages also lose. They live in constant uncertainty – says Savić and estimates that “Fiat”, if we were in a real market economy, would have put the key in the lock a long time ago.
Remember that a new model has been announced for several years, that it will never happen. The Serbian government and “Fiat” signed a ten-year contract in 2008, which envisaged that the Italian “Fiat” would own 67 percent of the factory in Kragujevac and the state of Serbia the remaining 33 percent. It was officially opened in April 2012. By the way, this factory belongs to one of the most modern “Fiat” factories and its production capacity is about 185,000 vehicles per year.
Due to the continued slowdown in exports in recent years and the significant decline in demand for automobiles during the pandemic, “Fiat” is no longer our largest exporter. According to data from the Ministry of Finance, it slipped to fourth place on the list of the largest exporters and in the first seven months of 2020 it exported cars worth 186.7 million euros. While last year it ranked second on this list, and its export amounted to 251.6 million euros in the first seven months.
“FCA Serbia” achieved the best export performance in 2013, when it generated foreign exchange earnings of 1.53 billion euros in foreign markets. The following year, “Fiat” exported 1.36 billion euros, in 2015 1.18 billion euros and in 2016 1.07 billion. As of 2018, the decline in placements becomes more drastic, so that exports for that year were only 850 million euros.
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