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Fiat hit by strikes as talks fail
ROME, Italy (CNN) -- Workers began striking at Fiat factories on Friday after talks between the company and unions collapsed when labour leaders refused to accept a government-brokered plan aimed at softening job cuts. Fiat, Italy's largest industrial group, wants to cut 8,100 jobs at its loss-making car business as it pushes through a do-or-die recovery plan. The first wave of layoffs -- totalling 5,600 -- will start on Monday at Fiat Auto plants. The government on Thursday presented the two sides with a compromise proposal that would have sacrificed about 2,400 jobs in return for securing the future of thousands of other workers after a year away from work. But union leaders rejected the offer. They are concerned that company's restructuring efforts are a prelude to selling the unit to General Motors, which already owns 20 percent of Fiat Auto and has an option to buy the remaining 80 percent in 2004. "We recognise that it is impossible for the parties to reach an agreement," Deputy Prime Minister Gianfranco Fini said. After the talks broke down, the top three metalworker unions called eight hours of strikes at Fiat factories and related companies on Friday, the latest in what could be a prolonged series of protests across Italian industry. Hundreds of workers blocked roads in Fiat's hometown of Turin on Thursday to persuade Fiat to abandon plans to cut jobs. A small group of employees at the Termini Imerese plant outside the Sicilian capital of Palermo climbed onto the roof of the factory on Wednesday and threatened to jump off if their jobs were not guaranteed. Fiat employees across Europe are also due to march on December 16 to demand investment in development rather than job cuts. Fiat is under pressure from creditors to reduce its net debt to 3.6 billion euros by early 2003 from 5.8 billion euros at the end of September. The maker of Alfa Romeo, Lancia and Fiat models has said it plans to spend 2.5 billion euros to develop new cars.
The company had hoped the new Stilo would boost sales but it has failed to galvanise European consumers. Once the biggest carmaker in Europe, Fiat has slipped to sixth place. Its share of the Italian market fell to 28.2 percent in November -- about half what it was a decade ago. Fiat Auto posted an operating loss of 823 million euros in the first half this year and car sales fell to a record low in November. Creditors are unwilling to loan more money to Fiat and the government has dashed the hope of workers by saying it won't step in to save jobs. But political pressure has forced Fiat to scrap plans to close its Sicily plant where unemployment is above 20 percent.
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