From: Reuters
Published January 8, 2008 05:09 AM

Fiat sees EU CO2 proposal upping prices: report

VIENNA (Reuters) - Fiat Chief Executive Sergio Marchionne said the EU's proposed legislation to lower carbon dioxide emissions from cars would push up prices for buyers.

The European Commission proposed in December tough legislation aimed at reducing CO2 emissions which would mean manufacturers failing to comply face steep fines.

"Partnerships and alliances will be the only way to cut the costs we are faced with," Marchionne said in an interview with daily Wirtschaftsblatt published on Tuesday.

"This is hitting the wrong ones, something is forced upon the producers," he said. "If the aim really is to reduce CO2 emissions there are much better ways to do so."

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Marchionne expects costs to produce a Fiat will rise six percent for every car, or up to 4,000 euros ($5,876) for the most expensive models.

"This is a huge sum and we have to pass this on," he said.

Marchionne also confirmed the carmaker's 2007 outlook for trading profit of 2.9-3 billion euros and sales rising to 57 billion euros from 51.8 billion euros. "It was a very good year," he said.

(Reporting by Karin Strohecker; editing by Sue Thomas)

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