Former VW executive to head Fiat Auto

DETROIT, Oct 2, 2003; Reuters reported that Italy's Fiat AG has chosen a former head of Volkswagen AG's operations in Brazil for the top job at its loss-making Fiat Auto, Automotive News reported on Thursday.

Citing sources close to negotiations, Automotive News said Herbert Demel, currently president and chief executive officer of Magna Steyr, the European vehicle assembly arm of Magna International Inc., will replace Giancarlo Boschetti as chief executive of Fiat Auto.

Officials at Magna's headquarters in Aurora, Ontario, Canada were not immediately available for comment.

Fiat had said that Martin Leach, former head of Ford Europe, had been in the running for the job to replace Boschetti, who is due to retire next year. However, Leach had been hindered by a non-compete clause he had with Ford.

Demel, the former chief of VW's luxury car unit Audi, has experience in two of Fiat's key markets -- Europe and Latin America, Automotive News said.

Fiat could announce the appointment of Demel as soon as the end of the month, according to Automotive News.

Fiat Auto has spent nearly the last two years battling through its worst crisis in its long history, brought on by a slump in car sales and poor quality, forcing what was once Europe's largest carmaker to cut jobs, sell assets and revamp its model lineup.