Fiat will not leave Italy, CEO says Marchionne backs Rome's labor reform plans

(ANSA) - New York, March 30 - A recent ruling forcing Fiat to re-hire three union activists it fired, because a court did not find 'just cause' to terminate their contracts, will in no way affect the automaker's presence in Italy, where it intends to remain, according to Fiat and Chrysler CEO Sergio Marchionne.In an interview with the Canadian publication Tandem, Marchionne said ''we have already appealed that decision and will wait and see what a higher court says'' and in answer to a question on whether Fiat may leave Italy he said ''the answer is no. We have already answered that question several times''.Marchionne has repeatedly been forced to deny any intentions of moving Fiat out of Italy due to concerns in Italian union and political circles that the CEO is more interested in Chrysler, in which Fiat currently holds a 58.5% stake after it rescued the Detroit Number three from bankruptcy in 2009.The CEO, however, has himself fueled such speculation by stating that Fiat could not continue to produce cars at a loss in Italy just to maintain a national icon and saying that unions had to allow flexibility in work schedules.More recently, Marchionne said Italian plants needed to operate at full capacity to be profitable and that this could be possible if they produced Chrysler models for the American and other markets.In Thursday's interview Marchionne also threw his full support behind the efforts of Italian Premier Mario Monti to push through labor market reforms, including measures to expand 'just cause' to lay off staff.Marchionne said he spoke with the premier last Friday and that Monti is ''involved in this (labor reform) project and we need to allow him to push it forward. Without stopping''.Unions are opposed to the reform of 'just cause', that includes economic considerations, because they fear it will make indiscriminate firings easier.In the interview Marchionne confirmed Fiat's plans to come out with an electric car by the end of the year, make the 'Abarth' high-performance versions of Fiat models available in North America and to bring back the Alfa Romeo marque to the American market in 2014.Looking ahead the CEO said that ''the future is good''.Fiat's alliance with Chrysler, with which it is set to merge with in the future, has been a boon for the Italian automaker and allowed it to return a profit in 2011. Fiat's net profit for 2011 amounted to 1.7 billion euros, which without extraordinary earnings, attributed in large part to the increase in value of its stake in Chrysler, would have been 800 million euros, while without its earnings from Chrysler it would have only broken even in 2011.Combined overall earnings for 2011 amounted to 59.6 billion euros of which 23.6 billion euros were from Chrysler during the second half of the year.Fiat acquired an initial 20% stake and management control of Chrysler, which had filed for bankruptcy protection, in exchange for its cutting-edge green and small-car technology, as well as access to Fiat's sales and service networks in Europe and Latin America.After meeting a series of established benchmarks, including producing a more fuel-efficient Chrysler car in the US, Fiat has since increased its stake in the US marque to 58.5% and the two companies, which Marchionne said were a ''perfect match'', should be fully merged by 2015, the year the CEO said he would like to retire.