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Fiat lay-offs to go ahead

Fiat is set to lay off 5,600 workers after the Italian Government failed to broker an alternative to the ailing carmaker's redundancy plan.

The Government is now likely to approve the redundancy plan next week.Under the plan, Fiat Auto will be permitted to use special industry-financed funds for lay-offs that last up to one year.

The Italian Government appears to have backed away from buying a stake in the company as an alternative to the Fiat restructuring plan after business consultants Morgan Stanley and Roland Berger reported that the carmaker's plans were sound.

The lay-offs will now being begin – starting with 1800 workers at Fiat Auto's Termini Imerese plant in Sicily. Another 2000 long term lay-offs are planned for next July.

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