Automobile producer Fiat will this week make a decision as to where production of its new Panda model will be launched, after getting what it considers insufficient support from workers at its Pomigliano d'Arco plant in Naples, Italy. The firm had planned to start production at Pomigliano, but only if enough workers there agreed to adopt working conditions similar to those in the company's factory in Tychy, Poland.

Some 62 percent of workers at the Pomigliano plant agreed to Fiat's proposed changes in working conditions in a referendum held on June 22, but the company had wanted more support before it green-lit the move which is expected to cost €700 million.

“The company will work with those trade union organizations that have accepted the agreement to jointly identify and implement the conditions necessary for the realization of future projects,” said Fiat in a statement.

The company counted on getting around 80 percent support and repeatedly stressed that it would not move production to Naples unless enough workers agreed to the changes.

Despite the current uncertainty, however, Italian newspaper La Repubblica states that there is little possibility that the Fiat plant in Tychy, where the present Panda model is produced, will now also get the new Panda. And Rafał Orłowski from auto analyst Automotive.Suppliers.pl, agrees.

“The Tychy plant has repeatedly shown its class. But here, politics is in first place, so I would be surprised if that happened,” he said.

The most recent wave of media speculation suggests Fiat will not move production to Italy, nor keep it in Poland, but instead move it to the Balkan state of Serbia, where production costs are cheaper.

According to La Reppublica, Fiat's management will speak about the future of the Pomigliano d'Arco plant this week.

The deal needs to be struck by September in order to meet the company's target of launching production in the second half of 2011.

Polish job fears unfounded

Production of the current Panda model accounts for half of the more than 600,000 units produced in Tychy, but Fiat has repeatedly stressed the plant has nothing to fear.

“We are not and do not plan to make anyone redundant [in Poland],” said Enrico Pavoni, head of the Group in Poland, in a interview for Puls Biznesu on Monday.

Fiat plans to produce the present Panda model at Tychy until at least 2012. The plant also won the right to produce the new Lancia Ypsilon, on which production will start in Q1 of 2011.

Fiat's production in its five Italian plants, which employ a total of 22,000 workers, only slightly exceeds total production in Tychy, which employs around 6,100.