Belgrade, Dec. 29, 2009, (Serbia Today) - Italian auto giant Fiat will pay today EUR 98 million as an initial installment in a new joint venture with the Republic of Serbia, it was reported yesterday at a press conference held by the Mayor of Kragujevac.
Fiat will ultimately invest a total of EUR 800 million for a 67% interest in “Fiat Auto Serbia” (FAS). The Serbian government will invest EUR 250 million, mainly for modernization of infrastructure, for a 33% interest in the joint venture.
Kragujevac is where Serbia’s largest car manufacturer “Zastava” is located. Decades of underinvestment in infrastructure and new technology had brought this company to the brink of collapse.
Since most workers living in the Kragujevac region have been employed by Zastava, the Serbian government did everything it could to save Zastava from bankruptcy and to maintain the industrial complex in Kragujevac.
It is expected that the construction of the new production facilities in Korman Polje near Kragujevac will start soon. There are reports that Fiat has very ambitious plans for “Fiat Auto Serbia” including the production of two new models for the EU market.
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