Mergers News

UPDATE 2-Some 18,000 Fiat/Opel jobs at risk -paper

 * Fiat's Pomigliano and Termini Imerese as well
 * Austria's engine plant in Aspern also
 * Fiat denies report
 * Opel/Vauxhall's Luton, Ellesmere Port and Antwerp at risk
 (Adds Fiat denial, Berlusconi comments)
 FRANKFURT, May 5 (Reuters) - Italian carmaker Fiat SpA
FIA.MI would cut some 18,000 jobs and 10 assembly and
component sites at a combined Fiat/Opel company including both
Vauxhall plants in England and two Fiat factories in Italy, a
German newspaper reported.
 However, Fiat denied the report in the Frankfurter
Allgemeine Zeitung, which said that all 10 would be shut down
between 2011 and 2016, citing a 103-page internal Fiat strategy
plan dated April 3.
 The plan was written in English and dubbed "Project
Football." The report is in an advance copy of the newspaper's
Wednesday issue.
 Fiat issued a statement saying the information in the report
"does not come from Fiat and is not part of any plan prepared by
the company."
 The closures should eventually lead to additional free cash
flow of about 4.3 billion euros ($5.76 billion) by 2015, the
newspaper said.
 Fiat Chief Executive Sergio Marchionne met German officials
on Monday to discuss an offer for Opel, the German unit of
General Motors Corp GM.N. Italian Prime Minister Silvio
Berlusconi said on Tuesday he was confident a deal with Opel
would go ahead.
 "All the information I have is that there is great interest
in this operation, which would be almost a dream for all
Italians," he said in a television interview.
 Fiat would shut down Opel car manufacturing plants in Luton
and Ellesmere Port in England, home of its sister brand
Vauxhall, the newspaper report said. The plant at Antwerp,
Belgium, would be the first to go in 2011.
 Among Opel component sites, some or all of the engine and
transmission production in Germany's Kaiserslautern,
Ruesselsheim and Bochum plants would be closed. Austria's Aspern
would also be shut down.
 In Italy, Marchionne would shut Fiat's Pomigliano plant
where most Alfa Romeos are built along with Termini Imerese in
Sicily, which manufactures Lancia Ypsilons. Closing the five
carmaking sites would cost upfront 1 billion euros ($1.34
billion) but reap 282 million euros in annual savings. The five
component factories would bring in another 200 million euros in
savings every year.
 The paper reports Fiat wants to gain access on the cheap to
GM's platforms on which it builds the Opel Corsa subcompact, the
Astra compact and Insignia mid-size car.
 A further key aspect of the plan is acquiring GM's Latin
America operations.
 According to sources on the Opel supervisory board,
Marchionne also plans to put an end to GM's Saab brand and its
own Lancia brand over the longer term.
 (Reporting by Christiaan Hetzner and Gavin Jones)