By Gilles Castonguay
MILAN--Italy's Fiat Industrial SpA (FI.MI) Tuesday said it had
kept production suspended at a plant in Spain and brought it to a
halt at a second one in that country due to an unresolved dispute
with a parts supplier, putting a strain on the truck and tractor
maker that's already struggling with low sales in Europe.
Fiat Industrial suspended for a third day production of the
Stralis and Trakker commercial trucks for its Iveco brand at a
plant in Madrid, according to a spokesman.
It also halted production of the Iveco Daily van at another
plant in Valladolid, he said, adding that a third plant in Italy
where the Daily is also made risked having its operations suspended
too.
Based in Turin, Italy, Fiat Industrial has had to resort to
these measures for a total of more than 10 days this year as a
result of the spat with Selmat Group, which makes plastic parts for
the interior of vehicles such as air vents, door panels and
dashboards.
Fiat Industrial's U.S. division, CNH Global NV (CNH), has had to
slow down production at some of its facilities in Italy in light of
the dispute, the spokesman said.
At its sister company, Fiat SpA (F.MI), production at two plants
resumed Tuesday after a brief suspension, a spokesman for the
automaker said.
The pace of work at these plants--one in Italy where the
Maserati brand's Quattroporte sedan is being made, and another in
Serbia where the Fiat 500L is put together--was slow, however.
Work at a third plant in Poland where the Lancia Ypsilon is made
was slow, too, the Fiat spokesman said.
Fiat and Fiat Industrial have said they weren't receiving the
parts needed to finish the assembly of their vehicles.
But Selmat has denied this, saying it was supplying the two
companies despite the dispute, which has led to legal action by
both sides.
Selmat is the sole supplier of these parts for Fiat and Fiat
Industrial.
Although Equita analyst Martino De Ambroggi described the
dispute as an isolated incident, he said in a note it could pose a
problem if it wasn't resolved quickly.
In Serbia, Fiat is preparing to export the 500L to the U.S. to
expand the presence of its namesake brand, which currently only has
the 500 city car in that market.
Maserati has just begun making the latest version of its flaship
Quattroporte, the first in a series of new cars to relaunch in the
brand and help Fiat in its plans to turn its manufacturing base in
Italy into an export hub for premium and luxury vehicles.
Based in Turin, Selmat is a privately held company with about
1,000 employees and some EUR130 million in annual sales.
At 1119 GMT, Fiat Industrial shares are down 0.23% at EUR8.77
and those for Fiat are up 2.30% at EUR4.97 in Milan.
Write to Gilles Castonguay at gilles.castonguay@dowjones.com;
Twitter: @GRCastonguay