Chrysler 2010 Annual Report Download - page 60

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Talks then resumed at the request of the majority of trade unions and, on December 23rd, an agreement was
signed at the Unione Industriale di Torino with FIM, UILM, FISMIC and UGL Metalmeccanici (both national
representatives and those for the Province of Turin), and with the Association of Fiat Middle Managers. The
agreement contains specific provisions to guarantee achievement of the necessary level of competitiveness
in terms of capacity utilization, flexibility, productivity, and governability. Implementation of the agreement was
subject to acceptance by a majority of workers and, in a referendum held on 13 and 14 January 2011, 54%
of employees voted in favor.
At Palazzo Chigi on 18 June 2009, Fiat announced to representatives of national and local government and the
trade unions that it would cease auto production at the Termini Imerese plant in 2011. This was reconfirmed on
22 December 2009 during the presentation (at Palazzo Chigi) of the Group’s 2010-2011 Plan for Italy. As no
alternative industrial solutions for the site had been forthcoming, the Group stated its willingness to work with
government and unions in supporting any viable proposals for conversion of the site put forward by the Region
of Sicily, or other public or private sector entities. On 29 January 2010, the Ministry for Economic Development
set up a round table – with representatives from the national government, the Region of Sicily, trade unions,
Confindustria Sicily and Fiat – to explore solutions for a viable industrial alternative at Termini Imerese. Several
subsequent meetings were held during the year, with regular updates provided by Invitalia (advisor to the
Ministry for Economic Development tasked with producing a development plan identifying manufacturing
and employment prospects in the area) on parties interested in submitting proposals for conversion of the
industrial zone at Termini Imerese, as well as their preliminary plans. At the meeting held on December 21st at
the Ministry for Economic Development, several proposals were presented that could potentially be developed
in parallel and that, according to the Ministry’s assessments, could generate employment for about 3,300
people in the area (compared to the approximate 1,600 people currently employed by Fiat Group), therefore
preventing any negative social impacts. Fiat Group reconfirmed the position expressed on several previous
occasions that it was willing to make the area at Termini Imerese available for new initiatives, on the condition
that priority will be given to employing the Group’s workers.
At the Ministry for Economic Development, the working group established in 2009, in collaboration with
the Region of Emilia Romagna, continued work to identify industrial solutions for CNH Italia S.p.A.’s site at
Imola and minimize the social impacts of the termination of production activities. Since the rationalization of
manufacturing for CNH’s Construction Equipment business in Italy was announced, over 230 employees
have been relocated to other Group plants or found solutions outside the Group, while the remaining 220 will
benefit from the exceptional temporary layoff benefit scheme (a mechanism made available under emergency
legislation) until 30 April 2011.
Management of production levels
The business environment improved during 2010, particularly for the capital goods sector, which had been
particularly hard hit by a collapse in demand in 2009. Recovery in the automobile sector was much more
contained, reflecting a decline in volumes following the elimination of eco-incentives, which had sustained
demand in 2009, particularly in Europe. In Italy, Group companies continued to make extensive use of
temporary layoff benefit schemes in managing production levels, although with a reduction of approximately
20% over the previous year (on a comparable scope of operations) and higher than average reductions
for all sectors except FGA, where the decrease was negligible, and Magneti Marelli, where there was a
modest increase. For FGA, in particular, there was an increase in use of these schemes at plants dedicated
to manufacture of passenger cars, but a significant decrease at the Sevel plant due to sharply higher
production levels for light commercial vehicles. During the year, 13 plants, employing approximately 9,350
workers, reached the limit for ordinary benefits (52 weeks in any rolling 2-year period) and recourse was
made to the extraordinary temporary layoff benefit scheme, which provides for a further 12 months coverage