BUSINESS
10/03/2011 06:36 EDT | Updated 12/03/2011 05:12 EST

Fiat to produce Jeep SUVs in Turin plant starting in 2013 as well as Alfa Romeo model

ROME - Fiat said Monday it will produce Jeep SUVs at its Mirafiori factory in Turin from 2013 as it takes advantage of flexible work rules approved earlier this year by union rank-and-file.

The Italian automaker, which controls Chrysler, said the Turin plant will start being fitted with updated infrastructure next year to pave the way for the start of Jeep production in the second half of 2013.

The same factory will also manufacture new and updated versions of the Alfa Romeo Mito model.

Earlier this year, Mirafiori workers approved flexible work rules that Fiat SpA insisted were essential to boosting production in its joint venture with Chrysler. Fiat CEO Sergio Marchionne had threatened to look elsewhere to produce Jeep and Alfa Romeo brand vehicles if unions didn't accept the changes.

Flexibility guarantees are key to Marchionne's strategy of bolstering competitiveness by Fiat and Chrysler in world markets.

Insistence on having the freest hand possible inspired another move Monday by Fiat.

The automaker said it was pulling out of Italy's influential industrialists' lobby, Confindustria.

In a letter to Confindustria's president, Marchionne expressed a worry about the "risk" that recently approved legislation giving employers more flexibility in hiring or letting go of workers could be undermined after some industrialists indicated they might not fully enforce the new law.

"Fiat, which is engaged in the creation of a major international group with 181 plants in 30 countries, cannot afford to operate in Italy in an environment of uncertainty that is so incongruous with the conditions that exist elsewhere in the industrialized world," Marchionne said in the letter to Confindustria leader Emma Marcegaglia.

"On our side, we will exercise our freedom to rigorously apply the new legislative provisions," Marchionne said.

Separately, Fiat says a new gasoline direct injection turbo engine for Alfa Romeo will be produced at another Italian factory.