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Turin, home of Fiat, could be the next Detroit if the auto industry moves on

Chrysler's new Italian master, Fiat, has battled labor unions and won.

At face value, the new labor agreement for Mirafiori does note change much. It makes small adjustments to workers’ hours working times with the aim, according to a paper published by Fabiano Schivardi, to improve efficiency and productivity, something Italy sorely lacks.

But it also cuts back on union rights. They remain strong ― for example, union workers enjoy 80 hours of paid time to use for union activity ― but the small changes led some to claim that Italian democracy itself was at stake in the vote.

In the end, the new contract passed with just 54 percent of the votes. A poll conducted among workers by Termometro Politico, a news website, said that a majority of those who voted in favor did so because they felt “blackmailed” and feared losing their jobs.

Nina Leone, 47, voted “no” nevertheless: “There was no negotiation. It was take-it-or-leave-it. We couldn't accept it. And we know this is just the beginning.” She blamed the government for taking a back seat and letting the company and unions sort it out by themselves.

State intervention in the economy is common in European countries and especially in Italy. Fiat itself, Deaglio said, has been the beneficiary of many government incentives, bailouts or taxpayer-funded redundancy payments.

“But in 2009,” he added, “Marchionne did something unprecedented. He called for a 1,000 euro ($1,370) tax incentive for new car purchases to be scrapped. He was arguing that companies have to thrive without public support,” something that in Italy sounded nothing less than “revolutionary.”

Workers have taken Marchionne’s views personally. “The time for state help in times of crisis is over,” said Lipani. “I have one son. He is 13 now and I don't know if he'll be able to have a job like mine, I don't even know if he'll be able to stay in Turin.”

The city could be doomed to decline should Fiat decide to move its headquarters somewhere else, such as Detroit, after its merger with Chrysler is finalized. In 2008, just a quarter of Fiat’s cars were produced in Italy. Marchionne has often hinted that this might happen.

Abandoned warehouses and vast, empty industrial buildings dot Turin's streets. But experts agree that this Italian city won’t become a ghost town, even if one of its largest employers leaves. While the automotive sector employs more than 50,000 people, Turin is much less reliant on it than Detroit, Deaglio said. Other sectors, such as research, information technology and film production have boomed in recent years.

After successfully hosting the winter Olympics in 2006, there has also been a resurgence in tourism and Turiners have become more confident: “Fiat once was like a mum for the town,” said Stefano Tassinari, a social entrepreneur. “Now it is perceived like a distant cousin, whose fate interests us, but not exceptionally.”

Sergio Chiamparino, Turin's outgoing mayor, is confident that his town can go “beyond Fiat,” even if he hopes it won't have to do “without Fiat”― “It's possible ― but that would be difficult,” he said.