If you told us a year ago that Fiat was going to sign a deal with the government of Serbia, we'd have laughed. But that was before the country announced that it was accepting tenders for investment in the state-owned automaker Zastava, makers of the famous Yugo (aka Skala 55). The process started back in December when the Serbian government made the announcement, sparking interest from various automakers. But even as recent as last week, the Fiat stance was that it was still considering the proposition. Well, it appears the Italian auto giant has done thinking, and has signed a memorandum of understanding with Serbia to establish a joint venture that involves Fiat investing a staggering 700 million euros (!) into Zastava's manufacturing facilities in exchange for a majority stake in the company, known in full as Zavodi Crvena Zastava. The Serbian government, meanwhile, will contribute some 200 million euros through tax incentives and similar measures.
Fiat has revealed that it will use the Zastava plant to produce the upcoming Topolino microcar. The vehicle will be based on the same platform as the 500 and Panda, but even smaller and positioned below either model, and share the same name as the concept car that previewed the new 500 and originally used on the 1936 runabout pictured above. According to reports, the new Topolino will be a compact two-seater measuring just 3150mm (124 inches) in length, slightly longer than the Smart ForTwo at 2692mm (106 inches). A four-seater version is expected to follow, in addition to an upscale version for the Lancia division.
[Source: Automotive News Europe – sub. req'd]
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Reader Comments (Page 1 of 1)
GM? @ May 2nd 2008 8:20AM
Is this what they are doing with all that GM cash they received?
fsx @ May 2nd 2008 8:40AM
No, the GM money is long gone (it was not much more than a billion euros, which is change in the auto business). European manufacturers are making profits these days, you know? Someone ought to tell GM execs that it's possible to make profits off cars.
rick @ May 2nd 2008 10:08AM
Another interesting point, one of the business magazines last year quoted Fiat's market capitalization (I believe that's the term) at something like 3x GM's. So yes, they are the wonderchild of turnaround in the automotive world at the moment. Great piece in The Economist also if your into that business and capitol stuff.
Dazza @ May 2nd 2008 10:28AM
No. Fiat has been back in the black for the past three years.
Cinquino @ May 2nd 2008 9:51AM
The concept that previewed the new 500 was called Trepiuno, not Topolino. Don't get too excited.
Alan44 @ May 2nd 2008 10:24AM
I'va always loved the style of that old Topolino. Give us another retro car!
Red Star @ May 2nd 2008 11:32AM
Why is such a surprise that Fiat and Zastava are working together? They have been working together for a while.
indijanac @ May 2nd 2008 12:48PM
I thought that Fiat was going to build the next World Car at Zastava. The car would be similar to Dacia Logan and even Fiat's own Palio.
Michael @ May 2nd 2008 4:38PM
APRIL FOOLS!!! oh wait, it's May...