PIRC Pirelli & C SpA

By Eric Sylvers 

MILAN -- Italy's coronavirus outbreak, the world's worst outside China, has started to hit the country's big manufacturers, with Fiat Chrysler Automobiles NV and Pirelli SpA saying they will lower production as the epidemic advances.

Fiat Chrysler on Wednesday said it would boost efforts in its Italian factories to contain the spread of the virus -- which as of Tuesday had infected more than 10,000 people in Italy and killed 631 -- including intensive sanitization of work and rest areas, changing rooms and washrooms. Daily production will be reduced as part of the new processes, the car maker said.

"As a result of taking these actions the company will, where necessary, make temporary closures of its plants across Italy," Fiat Chrysler said.

A spokesman said the company's full-year production schedule in Italy isn't yet impacted by the plant shutdowns because it was rescheduling planned downtime for now.

Fiat Chrysler has factories across Italy, including several in the northwest part of the country, which has been hardest hit by the virus.

Since last month, the company has asked most office-based employees to work from home. It says all administrative work has proceeded as normal.

Italy has been on a full government-imposed lockdown since Monday, with officials introducing increasingly stringent measures to stop the spread of the virus. Schools, universities, cinemas and museums are closed. People are allowed to leave their homes only if they have a demonstrable need, including going to work for jobs that can't be done remotely.

The virus had already hit Fiat Chrysler's production elsewhere in Europe but this is the first time it has struck Italian plants.

The company temporarily halted production at a factory in Serbia last month because it couldn't get parts from China. The plant, which produces the Fiat 500L and employs more than 2,000 people, is now operating normally.

Fiat Chrysler makes Jeep, Fiat, Maserati and Alfa Romeo branded vehicles in Italy. The main Jeep factory is in the south where the virus is still relatively contained, while the other three brands are made in factories in the northwest near the company's Italian headquarters in Turin.

The Jeep Renegade is the highest-volume model exported from Italy to the U.S., though sales of the compact sport-utility vehicle fell 21% in the U.S. last year. Fiat Chrysler's U.S. sales decreased 1% in 2019, with its lucrative Ram truck brand posting the only sales increase for the year. Fiat Chrysler imported a total of 98,429 vehicles from Italy to the U.S. in 2019, according to the International Trade Administration. U.S. production isn't affected.

The coronavirus is also now hurting Italian production at Pirelli, where an employee at the tire maker's factory in Settimo Torinese near Turin has tested positive, the company said late Tuesday.

Pirelli said production at the factory has been slowed so it can function with a limited number of employees present, and that it expects there to be a "progressive recovery" of production in the coming days.

Available stock will be used to supply clients "with a suitable level of service," Pirelli said.

--Nora Naughton contributed to this article.

Write to Eric Sylvers at eric.sylvers@wsj.com

(END) Dow Jones Newswires

March 11, 2020 09:21 ET (13:21 GMT)

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