Mahindra & Mahindra plans to support Sicilian financier Simone Cimino’s plan to convert Fiat SpA’s Termini Imerese car factory to production of electric vehicles. Cimino has an agreement with Reva Electric Car Co. to build electric cars at Termini. M&M holds 55 percent stakes in the Indian electric car company.
Fiat plans to shut down the unprofitable factory, which assembles the Lancia Ypsilon model, by 2011. Fiat loses close to 1,000 Euros on every car produced at the plant, partly due to a lack of infrastructure and the high cost of shipping parts to the island.
“We have the financial strength to develop the plant and absorb the workforce,” Cimino said.
Pawan Goenka, president of Mahindra’s automotive and farm equipment unit, said “we like his proposal,” Goenka said, adding that “it is still at a very preliminary stage”.
Invitalia SpA, an adviser to Italy’s Industry Ministry, will announce shortlisted bidders for the Termini plant today. The Termini plant was built in 1970 in one of the poorest regions of the country.
Cimino is the CEO of private-equity fund Cape Natixis Sgr SpA. His project, involving investments up to 900 million Euros, would involve developing electric cars and solar-recharge capability in Sicily. Cimino, 49, said he may hire up to 3,500 people, including workers from the Fiat plant.