Report: Fiat wants to cut 20 percent of its executive jobs in Europe image

Fiat plans to cut management jobs by 20 percent in Europe, according to a person familiar with the matter quoted by Bloomberg.

The Italian automaker that controls Chrysler Group wants to reduce operating losses by eliminating around 110 of the 550 managerial positions in Europe at Fiat, Alfa Romeo and Lancia, said the source, who asked not to be identified.

Most of the jobs – 100 – will be eliminated in Italy, where most managers are employed. According to other sources, the reductions started in June, but a Fiat spokesman declined to comment. On September 18, Fiat said it won’t give up on Italy investment, even as it is set to lose 700 million euros in Europe this year. CEO Sergio Marchionne will meet Italian Prime Minister Mario Monti on September 22 to discuss the carmaker’s plans for Italy.

“There’s a controlled hemorrhage. We have been working to avoid conflicts with the company. The exact number of fired managers will depend on the decision that the government will make with Fiat on its future plan for Italy,” said Roberto Granatelli, a Federmanager union representative. He declined however to confirm the number of managers being fired.

For the moment, Fiat has halted new investments in Italy and reduced spending by 500 million euros in Europe this year. The carmaker also delayed new models and said it’s focused on temporary layoffs as opposed to permanent job cuts to reduce costs during the crisis.