Fiat to Build New Chinese Engine Plant in Chongqing on Low Wages

Italy’s Fiat Group has signed a memorandum of understanding with the local government of China’s Chongqing municipality to build a brand-new commercial-vehicle engine factory in the southwestern China. According to a report posted on Chongqing Development and Reform Commission's official web site, the Fiat Group will spend 1.8 billion yuan or about $263 million on the Chongqing city plant that will have an annual capacity of 100,000 diesel engines, with about 70 percent of the output destined for export. -Continued

The Italian carmaker chose Chongqing as the location for its new plant is for the natural beauty of the area and the availability of high-qualified workers –we’re just kidding. The reason behind Fiat’s decision can be found in China’s government statistics that reveal that the average wage in the specific region about 30 percent less than in Shanghai.