Stellantis Serbia

Stellantis Serbia, formerly known as Fiat Chrysler Automobiles Serbia (Serbian: FIAT Krajsler Automobili Srbija; abbr. FCAS) or FCA Srbija, is a Serbian automotive manufacturing company based in Kragujevac, Serbia — a joint venture (JV) between Stellantis which owns 67% of the operation and the Republic of Serbia, which owns the remainder.

Not to be confused with Zastava Automobiles.

Stellantis Serbia
FormerlyFCA Serbia
TypeJoint venture
IndustryAutomotive
PredecessorFormer site of Zastava Automobiles (1953–2008)
Founded14 October 2008 (2008-10-14) (Founded)
Headquarters
Kragujevac
,
Serbia
Key people
Silvia Vernetti (CEO)
ProductsFiat 500L
Production output
c. 21,000 units (Jan-Jul 2019)[1]
459,975 units (2008–2018)[2]
Revenue €543.52 million (2019)[3]
€1.35 million (2019)[3]
Total assets €565.03 billion (2019)[4]
Total equity €316.81 million (2019)[4]
OwnersStellantis (67%)
Government of Serbia (33%)
Number of employees
2,195 (2019)
SubsidiariesSlobodna Zona FAS d.o.o.[5]
Websitewww.media.stellantis.com/rs-rs
Footnotes / references
Business ID: 20468122
Tax ID: 105808309 [6]
FCA Serbia, Kragujavec, Serbia
External images
FCAS Headquarters Building
FCAS Site Plan
FCAS Assembly line
FCAS Assembly line
FCAS Assembly line
FCAS Sculpture, Kragujevac
Fiat 500L, European model

The company's headquarters and assembly plant are located on the former site of Zastava Automobiles (1953-2008) — 70 miles south of Belgrade on the Lepenica river in the country's central Šumadija region. Heavily damaged during the collapse of Yugoslavia, the factory was completely renovated and modernized, reopening in April 2012[7] as one of Europe's state of the art car factories.[8][9]

The operation currently has roughly 2,000 employees and works closely with 15 other companies and component suppliers, many located at the adjacent Grosnica Supplier Park — with a combined workforce of roughly 6,000 tied to production at FCAS. The factory has a daily output of roughly 400 cars.[10]

The JV is the largest foreign industrial investment in Serbia[11] and as the country's largest exporter, with exports valued at 1 billion euro ($1.1 billion) in 2016.[11]

The plant manufactures the Fiat 500L, a five-door, five passenger, front-engine, front-wheel drive, high-roof B-segment MPV, which FCA markets globally in more than 100 countries — with the notable exception of Russia.[12] By early 2018, production surpassed 500,000 units.[13]

Background

From 1955 to 1999, the Krugujevac plant manufactured Zastava Automobiles under the Zastava, Yugo, and Fiat brands. Serbia's central Šumadija region was severely impacted in the 1990s by the collapse of Yugoslavia, as well as the subsequent war and its sanctions. The factory buildings were severely damaged in 1999 by the NATO bombing of Yugoslavia.

By the early 2000s, automotive companies began opening new manufacturing plants in nearby Hungary, Romania, Slovakia, and Slovenia — representing brands including Audi, Mercedes Benz, Renault, and Suzuki.[14] Manufacturing costs in Serbia were projected at one fifth those of Italy and half of those in Poland.[15]

In April 2008, Fiat reached an agreement to purchase the damaged Kragujevac plant, completing a joint venture with the Republic of Serbia that same year and renaming the company Fiat Automobili Srbija (FAS). When FAS became a subsidiary of Fiat Chrysler Automobiles in 2014, the factory was renamed Fiat Chrysler Automobiles Serbia (FCAS).[16]

FCA pledged €700 million in return for a 67 percent stake in the company (then owned by the state) and an additional €100 million investment by the Serbian government.[17] This was later increased to €300 million. Fiat pledged not to cut jobs and to pay a backlog in wage payments, saying the plant would become a dedicated Fiat production site with a maximum production capacity of 330,000 units. The joint venture agreement between Serbia and FCA expires on 31 December 2018.[18]

In the end, the financing consisted of an investment by the government of Serbia of more than €300 million, partially financed from credit of €500 million in credit given by European Investment Bank with Republic of Serbia guarantees for €300 million while €200 million of the same credit line guaranteed by Servizi Assicurativi del Commercio Estero (SACE).[19][20]

While the joint venture contract is not publicized,[21] FCAS is exempt from employee income tax and social security contributions, Serbia's profit tax for 10 years from the first year, and property taxes, among others.[21]

In 2013, wages at FCAS were one fifth of Italian wages and one third of Polish wages.[12] Kragujevac also offers beneficial transport links and close proximity to European markets.[12] North American models are exported by rail and ship from the port of Bar, Montenegro.[22]

In 2018, Stellantis Serbia was the second largest (gross) exporter in the country, at €714.1 — behind HBIS Group, owner of Smederevo Ironworks.[23]

Plant

Between 2010 and 2012, Stellantis and Government of Serbia invested more than €500 million and spent three years upgrading the plant infrastructure, restored its buildings, developed new production departments and installed state of the art machinery and production systems.

The renovated Kregujevac plant incorporates 51 buildings total[24] and five primary process-related buildings — with an area of approximately 220,000 square meters[25] covering more than 140 hectares[26] adjacent to the Lepenica river.

Renovation included architectural, structural, geo-technical, mechanical, and electrical work as well as public health design, seismic retrofit design, fluid tank design, and pipe-rack bridge design.[25] The new work included planting 1,000 native trees in the factory area and creating a bio-lake hosting several endangered species.[27]

In 2013 the plant employed 3,800 workers with an average age of 30,[12] and incorporates "World Class Manufacturing" standards at the silver level.[24]

The FCAS headquarters (building 18c) has a ground floor museum, a permanent exhibition highlighting the history of the site and Kragujevac — along with a training academy as well as corporate and manufacturing offices.[28] A nearby building has an on-site kindergarten for employee families.

The co-located Grosnica Supplier Park[29] includes sub-works for Magneti Marelli (bumpers, spoilers, exhaust systems and catalytic converters), Johnson Controls MM (instrument panels, interior, interior parts and plastic parts), Dräxlmaier (electrical), with other plants nearby, including Adient (seats), PMC (suspension systems, sheet metal stampings and chassis assemblies), SIGIT (rubber and plastic parts) as well as HTL.[30]

Layoff, strike and stoppages

In June 2016, FCAS laid off nearly 30 percent of its workforce and ended one of its three shifts.[31] At the time, the plant employed 3,100 with up to 900 workers per shift.[31] European sales of the 500L had fallen by 16 percent in the first quarter of 2016.[31]

On 27 June 2017, after two days of protests, 90% of the workforce at FCAS began a strike that ended just over two weeks later. Workers demanded an hourly wage increase from 2 to 2,40 euros, paid overtime, an end to layoffs, a work reorganization, and compensation allowance for shifts that start or finish at night, from 10 PM to 5 AM, when the public transportation isn't operating. Two unions supported the strike, the Autonomous Metalworkers’ Union of Serbia (SSMS) and the Industry, Energy and Mining Workers’ Union, GS IER Nezavisnost. The strike halted the factory's 440 car-per-day production.[32][33]

By late March 2018, FCAS had undergone four plant closures to adjust supply to demand — the last of the stoppages from March 23 to April 3, 2018 (as of April 2018).[34]

See also

References
  1. "Fijat proizveo manje vozila" (in Serbian). 17 July 2019. Retrieved 9 December 2020.
  2. "KG: Za 7 godina napravili pola miliona FIAT-a 500L – šta im donosi budućnost?" (in Serbian). 16 August 2019. Retrieved 9 December 2020.
  3. "КОНСОЛИДОВАНИ БИЛАНС УСПЕХА (2019) - FCA Srbija". apr.gov.rs (in Serbian). Retrieved 9 December 2020.
  4. "КОНСОЛИДОВАНИ БИЛАНС СТАЊА (2019) - FCA Srbija". apr.gov.rs (in Serbian). Retrieved 9 December 2020.
  5. "Slobodna zona FAS d.o.o. Kragujevac". ekapija.com (in Serbian). Retrieved 28 January 2018.
  6. Основни подаци о привредном друштву. apr.gov.rs (in Serbian). Serbian Business Registers Agency. Retrieved 28 February 2018.
  7. "FIAT 500L: 500 GOES LARGE". Fiat Press. February 28, 2013.
  8. "Factory "Fiat Cars" in Kragujevcu". The Elnos Group.
  9. Žikica Milošević (February 23, 2016). "Alessio Leonardi is the new CEO of "FCA Srbija"". Diplomacyandcommerce.rs.
  10. "Fiat Serbia strike ends, negotiations kick off". Euractiv. July 20, 2017.
  11. Radomir Ralev (May 25, 2017). "FCA Srbija JV starts production of Fiat 500L in Kragujevac". Seenew.com.
  12. "Balkan legacy Fiat goes east to lower costs". The Economist. Nov 2, 2013.
  13. "500,000th Fiat 500L Rolls Off Production Line". FCA Press Released. February 22, 2018.
  14. John Mackedo and Lazar Šestović (May 4, 2016). "From forgotten Yugos to new engines of growth: Reviving the car industry in South East Europe". Worldbank.
  15. Stefano Giantin (August 18, 2012). "The Fiat 500L made in Serbia lands in Europe (trans. from Italian)". Il Picollo.
  16. FIAT Automobiles Serbia changed its name in FCA Serbia| http://www.b92.net/eng/news/business.php?yyyy=2015&mm=03&dd=20&nav_id=93549 | Retrieved: March 2015
  17. "Fiat Investing $1b into Zastava". Macedoniaonline.eu. 28 July 2008. Retrieved 29 November 2008.
  18. https://insajder.net/en/site/focus/4904/
  19. http://www.eib.org/infocentre/press/releases/all/2011/2011-061-eib-welcomes-serbian-delegation.htm
  20. http://europa.eu/rapid/press-release_BEI-11-61_en.htm
  21. "The new model of Fiat is made in Serbia through the old system of state subsidies". Insajder Production. May 26, 2017.
  22. "Fiat ships 500L to North America". Automotive Logistics. June 5, 2013.
  23. "Železara iz Smedereva prvi put najveći izvoznik, slede Fijat i NIS". n1info.com (in Serbian). Beta. 19 February 2019. Retrieved 19 February 2019.
  24. Giovanni De Filippis, Fiat Automobiles Serbia CEO (May 25, 2010). "FIAT Automobiles Serbia". Fiat Group.
  25. "Refurbishing the Fiat Zastava Car Manufacturing Plant in Kragujevac". Arup Group.
  26. "Plasticwood.it in the green design project of the new Fiat plant of Kragujevac, Serbia". Plasticwood.it. July 11, 2012.
  27. "Sabiana goes to Serbia with the Fiat 500L". Sabiana.it.
  28. "Fiat Serbia". Piustudio.it.
  29. "Johnson Controls Inaugurates New Seating Plant". June 7, 2011.
  30. "Kragujevac: Nine Factories Working For Fiat". In Serbia. June 3, 2013.
  31. Ivana Sekularac (June 15, 2016). "Fiat Chrysler to lay off 30% of workforce at 500L plant in Serbia". Automobile News.
  32. "Two thousand Serbian FIAT workers take strike action". Industriall-union.org. June 7, 2017.
  33. "Serbia premier: Workers at Fiat plant in agree to end the strike". National Post. July 18, 2017.
  34. "Production at Fiat Kragujevac halted until April 3". Ekapija.com. March 26, 2018.


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