Fiat Would “Fully Support” an End of Incentives

Fiat SpA CEO Sergio Marchionne, who has been urging Italy to renew scrappage incentives this year, says the company will be able to cope if the government decides against an extension.

"We would fully support any decision by the Italian government not to renew them," Marchionne says, adding that Fiat will survive "even under the most pessimistic scenario."

Marchionne has estimated that car sales in Europe will decline by 12% if new incentives are introduced and 16% if they are not.

But yesterday he said that extending incentives throughout Europe will merely pull ahead sales and postpone the industry's need to confront its overcapacity.

Marchionne appears eager to avoid a confrontation with Economic Development Minister Claudio Scajola, who threatened this week to kill proposals to renew Italy's scrappage incentive unless Fiat reverses its decision to close its assembly plant in Termini Imerese, Sicily, next year.