Forming of joint factory of companies "Iveco" and "Zastava Trucks" postponed for six months?

The Memorandum of Understanding, which was signed by the Government of Serbia and Italian “Iveco” at the end of September 2008 and anticipates forming of the joint venture for production of trucks and buses in “Zastava Trucks” and Kragujevac, expires on March 29th. Since the conditions for signing of the contract on forming of the joint venture have not been created in the meantime, the representatives of “Zastava Trucks” will start the initiative at the meeting of the Administrative Board on March 26th that that deal be postponed for six months, or until the end of the global economic crisis.

Let us remind that the Memorandum of Understanding anticipates that "Iveco" organizes production of special fire and military vehicles in the units of “Zastava Trucks”. In addition, Italians announced that they planned to start production of buses in the new factory, which would employ up to 1,600 workers. For construction of that factory "Iveco" asked the Kragujevac city administration to provide 20 ha of building land in Kormansko field.

At the forthcoming meeting of the Administrative Board of that company in Torino, "Zastava Trucks" will suggest assembling of two models of “Iveco” trucks until the forming of the joint venture. It is the business arrangement that would represent some kind of preparation for putting of the new company in "Zastava" in operation.

The representatives of “Zastava Trucks” will speak to the management of “Iveco” next week about the possibility that the Kragujevac factory of parts buys components for installation in the vehicles from “Iveco’s” factory “Naveco” in China. The components and parts that are produced in China are much cheaper than the ones that can be bought from Italian companies.