Advanced Search
Business | Metro | Nation | World | Sports | Features | Specials | Delta Stories
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.