Serbian, Italian vehicle makers sign contract on car assembly
21/9/2005 15:32
Serbia's largest vehicle maker Zastava signed on Tuesday a contract with
the Italian car manufacturer Fiat on a licence for assembling Fiat 's Punto
model cars.
The contract with Fiat is a first step in planned long-term
cooperation and should enable Zastava to expand its offer both at the domestic
market and throughout the region, Fiat's Vice President Gilberto Ranieri said at
the signing ceremony.
According to the contract, the assembly of the Punto
model will begin in 12 months, because technology will be modernized and workers
trained by then.
Zastava, which is based in Kragujevac, a key city in central
Serbia, is expected to assemble 16,000 cars annually, with costs reduced by 25
percent.
Serbian Minister of Economy Predrag Bubalo said that the contract
did not imply that Zastava was privatized, but that technical and business
cooperation would be established.
Bubalo said that if Zastava proves its
capability to assemble modern vehicles, the preconditions will be created for
attracting a new strategic partner for its privatization.
Zastava, which has
some 4,400 employees, has been unable to find a strategic partner since 2001
when Zastava Holding was decomposed.
Xinhua
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